Process of Starting a Business - Essay Sample

Introduction

Starting a business is a complex process. It usually requires several processes to ensure that an entrepreneur is in the right direction by making proper decisions and analyses on the business they want to start (Allen, 2020). The first step is developing a business idea, which is developed through personal evaluation. During the evaluation, the most important things to consider include; the reason for starting the business, personal skills, industry knowledge, the product or service that will be provided, hobbies, and capital (Allen, 2020). These factors develop and curate the business idea by narrowing focus and planning.

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After determining the business idea, it is essential to analyze the business industry to determine a business opportunity within the industry. An entrepreneur can use several tools for industry analysis purposes. A PESTLE analysis is a tool that allows the analysis of different important factors such as the political, economic, sociological, technological, legal, and environmental factors that influence an organization externally (Bruijl, 2018). This analysis will provide the entrepreneur with insights into the factors that may affect the business from the external environment. Porter's Five Forces analysis is also an essential model that helps entrepreneurs to understand the different forces that affect competition in the industry (Perera, 2017). It is an essential tool since it assists an entrepreneur to shape their competitive edge within an industry. It also assists in adjusting the strategy and suiting the competitive environment to ensure the profit margin has improved significantly.

An entrepreneur should also determine the target consumers and audiences by analyzing the market (Allen, 2020). Several things are determined during such an analysis, such as the urgency people have for the product. It is also crucial to analyze the size of the market and the actual target market.

Setting a business is the next step (Allen, 2020). This will ensure that the business is physically established as structured on the paper. There are several characteristics that entrepreneurs need to address to make it a reality. Entrepreneurship success is mainly dependent on these characteristics. However, it is essential to note that a new entrepreneur can develop these characteristics. Entrepreneurs should be self-motivated and dedicated to their plans (Chavez, 2016). They have to understand what they offer and how they fit in the market. Entrepreneurs should also be able to take calculated risks to ensure that they pay off. Networking is also essential in entrepreneurship. Being able to meet people and knowing them can be part of business success (Chavez, 2016).

Furthermore, knowledge and skills in managing money are essential as they help know where one stands financially in the business. Entrepreneurs also need to be flexible. It means that they should be able and ready to adjust as required (Chavez, 2016). This ensures that an entrepreneur stays on top of the industry and can adapt to products and processes changes. It also assists in solving business problems and finding unique and effective solutions to different issues. Finally, an entrepreneur should be passionate about their business (Chavez, 2016). Passion will ensure that one finds motivation when discouraged, and it assists in driving one forward. This is the incentive for successful entrepreneurship.

The next stage is the business planning process (Allen, 2020). it is a stage where a business is checked and analyzed to determine what it would take to ensure that a business is profitable, what needs to be done, and where the business is headed. This requires a business feasibility study to ensure that opportunities and problems are identified, objectives are determined, situations are described, and successful outcomes are defined to assess the range of benefits and costs associated with the business (Allen, 2020). These factors are essential in determining the direction of the business and solving problems. After the business is determined and considered feasible, following the business plan, the business is funded and analyzed to ensure it works well and properly set to start for trial and error (Allen, 2020).

Conclusion

Starting a business is a complex process. It usually requires several processes to ensure that an entrepreneur is in the right direction of making proper decisions and analyses on the businesses they want to start. The first step is developing a business idea. After determining the business idea, it is essential to analyze the business industry to identify a business opportunity. Several tools can be used in the industry analysis, such as the PESTLE analysis and Porter's Five Forces analysis, which are essential models that help people understanding the different forces that affect competition in the industry and the external forces that affect the business. Entrepreneurs can also identify target consumers and audiences through market analyses. Setting a business is the next step that involves setting up a physical business. There are several characteristics, which entrepreneurs require to meet to make the business come to reality. Entrepreneurs should be self-motivated and dedicated to their plans, well networked, money management skills, flexible, and an entrepreneur should be passionate about their business. The next stage is the business planning process. This is where a business is checked and analyzed to determine what it would take to ensure that a business is profitable, what needs to be done, and where it is headed. This requires a business feasibility study to ensure opportunities and problems are identified, objectives are determined, situations are described, and successful outcomes are defined and assess the range of benefits and costs associated with the business. Following these steps will ensure the development of a good business and ensure proper management, enabling the business to realize high profits.

References

Allen, C. (2020). Six Steps to Starting a Successful Business. Marriott Student Review, 3(4), 7.

Bruijl, G. (2018). The Relevance of Porter's Five Forces in Today's Innovative and Changing Business Environment. SSRN Electronic Journal. https://doi: 10.2139/ssrn.3192207

Chavez, J. (2016). The personality characteristics of an entrepreneur and their effects on the performance of a new business venture.

Perera, R. (2017). The PESTLE analysis. Nerdynaut.