Factors to consider when starting a small enterprise

Entrepreneurship-and-Communication-Skills-notes

Below are some of the factors to consider when starting a business:

  1. Entrepreneurial traits
  2. Business management and technical skills
  3. Long term market demand for product/service
  4. The cost of starting, operating and personal finance
  5. The level of competition – direct, indirect and future
  6. The business location – zoning law and appropriateness
  7. The rules and regulations for operating the business.              -Legal registration              –  Tax compliance              –  Relevant licenses                 -Code of conduct               –  Environmental requirements
  8. The anticipated profit.                                  -Importance of profit                -Adequate to cover inflation rate and opportunity cost               -Adequate to cover all expense, savings and investment
  1. The machinery, tools and equipment required and their cost.
  • Lease/buy decision
  • Calculation of lease/ buy decision
  • Maintenance cost
  • Availability of spare parts
  • Cost of service
  • Availability of technical support
  • Technological advances
  • The source of supply of goods/raw materials.
  • Identify long term supply sources/ reliable source
  • Quality of supply
  • Alternative sources of supply
  • Terms of supply should be favourable



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