Challenges in Starting a New Business

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Starting a new business can be very exciting as well as challenging. It can be exciting because it might be a transition from being an employee to owning a business and becoming one’s own boss where there is freedom of doing things without anybody’s influence. The idea of being a business owner can be very exhilarating in itself. Bateman states that ‘The control and ownership of a business is a very powerful feeling. Having ownership is like an adrenalin flow. It gives you more energy – you start to see what you can achieve.’(Smith, 1997, p. 149) There are numerous advantages of having one’s own business. The potential to earn a higher income, independence, being one’s own boss, ability to fully implement one’s creative talents, choosing one’s own hours of work and a sense of personal pride and achievement are just a few. Establishing a new business has two very distinct features. The first is that the entrepreneur is the sole arbiter of his/her ability to start and run the business. This puts a heavy responsibility on the entrepreneur’s self-knowledge as not everyone is suited to being an entrepreneur or self-employed and it is not always easy to determine one’s suitability. The second characteristic of starting a business is to create one’s own income. This is largely dependent on the type of business and the target market. In theory, a well-run business should succeed in any market. In practice, however, success can be made more likely by choosing one’s product and market. Planning is an important part of starting a business. The success of the business depends on proper and realistic planning. A good plan would include the entrepreneur’s vision of the business, short, medium and long term goals of the business, people and business partners and their roles and suitability, the product, competitors and the advantage of one’s product over the competitor’s, marketing of the product, finances, risks associated with starting the business and finally, the exit strategy which would determine the future of the business once the entrepreneur is retired. The next and most important phase is tackling the challenges the entrepreneur will face in starting the business. These challenges or hurdles play a vital role in the success of the business. They manifest themselves in many different forms. The most common challenges are determining one’s suitability to run the business, lack of finance, finding the niche, and the right product, location of the business if it is a retail business, and time management. Determining one’s suitability as an entrepreneur is an integral aspect of starting any business. Being the owner of a business brings along with it a lot of responsibility and hard work. The business may require the entrepreneur to work up to 12-16 hours a day and possibly six to seven days a week as well as holidays. This is in contrast many more hours than a regular, paid job, not to mention the physical and emotional stress that comes along with it. Added to this fact is the additional stress of not being able to spend much time with family and friends. The family’s ability to withstand the stress that this would put upon them is another factor that an entrepreneur needs to take into consideration. The owner must therefore be able to decide if he/she has the physical stamina to handle the workload and the busy schedule as well as the emotional strength to withstand the strain. Having prior knowledge or business experience also plays a vital role in determining one’s suitability of being an entrepreneur. Another factor is that the business may require the owner to temporary lower his/her standard of living as initially, there may not be enough income generated by the business in the first few months of being established. This is an interesting situation as people may live under the assumption that starting a business will make them rich very quickly if not overnight. Such an assumption is dangerous as the owner may be in for a...
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