A business is any activity or range of activities centered around producing a product or providing a service for profits.
The Importance of Profit in Business
Indeed, profit is the lifeblood of any business. If the business fails to make a profit, then the business would go into debt. When a business goes into debt, it can no longer procure the resources needed to survive and thus can no longer produce the product or provide the service it aims to produce or provide. Not only that, the business would then face problems with the law and other businesses since it cannot fulfill its financial obligations. When this happens, the business owners may declare bankruptcy, seek expert intervention to revive the business, seek financing to revamp its operations, sell out the business, or just cut and run. In a worse-case scenario, depending on the type of business registration, the business owners may be arrested and charged with failing to meet financial obligations and may even face jail time. For all of these reasons, business owners need to ensure that their business clears a high profit margin and do everything they can to maximize efficiency within the business.
Related: The failing Guyana Sugar Corporation.
Without a market, there wouldn’t be a business. You could create the best product in the world, and provide the best service, but if there is no one willing to pay for your product or service, your business simply can’t get off the ground.
Related: The power of advertising.
On the other hand, there could be a hungry crowd of eager buyers who long for your product, but if you don’t have the knowledge or means to put your product or service in front of these buyers, you’re just as good as dead when it comes to taking off. This is where the importance of strong market-research, marketing and distribution skills come in.
The Business Plan
Doubtless, there are countless marvelous success stories where an ordinary citizen starts selling apples or cherries and grows into a million dollar thriving business without creating a scratch of a business plan, or care a damn about it. Without a doubt, you can succeed this way with your personal business by starting with something small. But if you are looking for partners and financing, a business plan is essential.
Related: The importance of starting small, growing big, and exploding into universal success.
When creating a business plan, you will need to lay out exactly what product you intend to produce, or what service you intend to provide. Who is your market and what methods did you use to research and establish this market? Is the market you are targeting likely to expand or decline over the coming years? What factors will cause your market to expand in the coming years? (If the market would decline you may not want to go into this business). How exponentially or by what multiple is your market expected to grow each year? Are you likely to be drown out by competition? Why not? (It better be not).
What natural resources will you be expending in producing your product or providing your services? Are these natural resources renewable or non-renewable? If they are non-renewable, are you sure there is such a great abundance of it that it is not likely to be depleted and cause problems? What machinery and skills will be needed to turn these raw materials into a finished product?
Human resources in business.
Managing human resources in an important aspect of certain types of businesses. There are some businesses that can be successfully operated with just a single person and there are others that require tens, hundreds or thousands of employees. If your business is one that requires a lot of human resources, you need to be skilled in managing resources. Which brings us to….
Exploiting Natural Resources to Create Profits
The word “to exploit” is not such a bad word, when used in a good way. The original and most basic sense of the word “to exploit” means to make full and complete use of (something). For example, an entrepreneur may exploit the abundant lemon resources in the city of Rondonopolis, Mato Grosso, Brazil to create a lemonade factory. Or a smart entrepreneur may exploit the abundant mango resources in the city of Bon Fin, Roraima, Brazil to produce bottled mango juice. Other than the essential or key resource needed for the product, there may be other less abundant resources which the business owner needs to purchase from remote locations. The entrepreneur needs to factor in all expenses in production, as well as market availability and accessibility before deciding whether or not to embark on the project. Indeed, turning wasting natural resources into a sought-after finished product is the key to building multi-billion dollar corporations…from the ground up.
If your business requires a lot of hands to make light work, then you need to ask yourself if there are potential employees eager to fill the position. Note that there needs to be potential employees who are “eager” to fill the position: bear in mind that forced labor and slave driving fare well neither by human standards nor the courts of divine justice. Make sure that there are suitable prospective employees and a survey shows that they are eager to work, which brings us to…
Related: Do not plunder the poor because they are poor….
Motivating your employees is an important aspect of guaranteeing the success of your business, if it is one that requires a lot of human resources. Regardless of what type of business you are running and what level of skills and qualifications are required, your employees need to feel that they are in a safe haven: in a place where their labor and input is valued, respected and paid well. If you are in a position to give orders to employees, you need to be firm but gentle at the same time. Shouting commands from on top of a high horse is a good way to create chaos by consistently losing workers. On the other end of the spectrum, I’m not telling you to put yourself in position to be taken advantage of by workers. A perfect balance need to be struck and there is often a thin line between leniency and going overboard. That being said, greet every worker with a bright smile, point out their strong points and try to harness those, give orders in a firm but gentle tone and let everyone know that their success is just as important to you as the success of the business.
The customer is always right. Well…kind of…
The customer is always right? What a dangerous motto to live by! What if the customer walks into your office one day, shove your product into your face and walk out…saying that is no good? Certainly, the customer is not always right. Nevertheless, the expression is meant to convey the level of customer service satisfaction you need to aim for in satisfying the people who are shelling out hard-earned money to keep your business alive and thriving. Keep your customers smiling and they will go about talking good things about you, and as it says in the bible, “a good name is better than diamonds, rubies and other precious stones”. In other words, give your customers diamonds, and they will make you shine.
Related: You get what you pay for.
Related: How to rule the humans.