Planning is key to starting a business

MBOMBELA – Starting and managing a business is not an easy task as there are a number of factors that have to be taken into account from the get-go to ensure that it has a solid foundation.

Some businesses fail miserably while others succeed with a large turnover at the end of the financial year.

How does one start a new business on the right foot?

“Carefully and with proper planning. Knowing your target market and goals are very important,” answers Mr Andries Oosthuizen, partner and management of auditing, tax and accounting services at PricewaterhouseCoopers (PwC.)

A business plan is the first aspect that needs to be put on the table. This can either be done formally, or as an outline of the basics.

It is advisable to have structure as this will assist with potential financing and investment opportunities.

“Do research about the industry before you blindly decide to open a business which is not going to be profitable, just because you like the product.

“Choosing a name is important as it will symbolise what your products and services are.

“It is also important to respect current business names and their naming rights.

“There is a database of registered company names on the Companies and Intellectual Property Commision (CIPC) website,” Oosthuizen says.

“Businesses can be registered directly on the website. A database with registered names is also available which will tell businesses whether they will be able to operate with that name.

“Accounting firms will also be of great assistance to procuring and manifesting a company’s name,” says Ms Hester Augustyn, small-business manager of PwC.

Oosthuizen adds that it is important to firstly know your products as well as the market to which you are selling.

“Know what is trending, practical and cost-effective. Keep tabs on your competition and differentiate from them with a unique product which enriches the potential client and adds value to their lives,” he says.

Also be sure to rent or own a property which is going to attract customers and make sure that your business is well known. Social media can be used to your advantage or disadvantage, depending on how it is used.

“Seldom, businesses function independently and often need input from various sources.

“Expert knowledge comes in very handy especially when the product continues developing. It should never become stagnant,” says Oosthuizen.

The financial side is crucial to take into consideration especially with regard to capital, marketing costs, and whether or not loans will be made.

According to him, this all depends on the type of company. “The first route that a business owner can take is registering the business as a sole trader. If you have more role players, then it would be wise to start a business partnership, in order to delegate different tasks and sides of the business.”

It is critical to keep check and report all financial transactions and monthly income and losses especially with regard to tax laws.

Oosthuizen suggests that an auditor will be able to keep the books in check and assist in its financial aspect.

“Keep your financial records up to date from day one. It will also be easier than to acquire financial assistance when needed, as the bank can see how your business performed and that you are a reliable businessman.

According to him, a successful business is also one that has a clearly mapped-out business structure.

“This will delegate responsibilities and tasks to various members who are part of your business from leadership roles to the employees at ground level.”

Starting a new business is never easy but at least there are numerous avenues they can visit when feeling the pinch.

“Business chambers and small- business groups, the Department of Trade of Industry and Small Enterprise Development Academy are just some of the regular contacts that business owners should keep in touch with. There you will be able to meet other people who are in the same boat or know how to survive deep waters,” explains Augustyn.