Factors to consider when establishing a company
The creation of an efficient company does not arise by chance. It involves a lot of input or factors. Proper consideration and planning of these factors can help one to be able to set up a very labor intensive business. Some of the factors that deserve serious consideration are discussed below.
1. Capital: Refers to the funds or money available for the establishment of the company. The entrepreneur must have start-up capital and working capital to help the business stay on its feet. The initial capital is the capital that is used for the purchase of tools, equipment, materials and machinery to start the operation of the business.
On the other hand, working capital is the capital used in the day-to-day running of the business. It covers the salary of workers, transportation costs and the purchase of new materials for production, operating costs, maintenance of machinery and all other things that ensure the smooth running of business activities. The entrepreneur must have a solid financial base that allows him to establish and manage the company.
2. Room or Space for Workshop: The entrepreneur must also look for an appropriate room or space for the workshop. The space must be large enough to accommodate all equipment, tools, and machinery, as well as the entire workforce. It must also allow free movement from one area of the workshop to another.
In addition, the room must be well ventilated and well lit so that the execution of commercial activities is very fluid. The space must be located in a good place where tools, materials and machinery can be stored well without internal or external hazards.
3. Skilled Labor: The workforce or workforce of the company refers to the people who are employed to work for the company. The appointment of these individuals must be strictly based on their experience or technical ability that can be used for the success of the company.
The entrepreneur must seriously consider this factor, otherwise he will end up paying people who in no way contribute to the generation of funds for the company. Qualified personnel must be employed with excellent characteristics that can have a positive impact on business activity. People employed to work in the company should never be based on family reasons or sympathy. Doing this would eventually collapse the business enterprise.
4. Availability of raw materials: The entrepreneur must ensure that he has a sustained supplier of raw materials for his company. He must have a large stock of these raw materials that can sustain him for a fairly long period of time. This would not cause business to cease or stop when raw materials are very scarce. He must have reliable suppliers of his raw materials. If possible, he can even start the production of his own raw materials.
5. Transport and communication: the entrepreneur must consider the means to transport their products from the company to consumers and stores. Roads to and from the workshop should be well built or accessible to ensure easy transportation of products. Means of product transportation, such as vehicles, may be available to assist in transportation.
Lines of communication should be easily accessible to potential customers who want to call to propose business transactions. Telephones must be installed in the company, as well as in all its departments. This would ensure the fluid flow of information, improving productivity.
6. Proximity to the market or clients: The location of the company must be close to possible buyers or clients. It should be closer to the market. This would promote and maximize the sale of the products.
7. Selection of a trade name: The entrepreneur must select an appropriate trade name for the company. It must be attractive, easy to remember and must have a direct relationship or a complete description of what the company produces. The trade name must be unique and original.
8. Registration requirements: Whoever wants to establish a company must make an effort to comply with all the registration requirements. For example, you have to register the company with the Business Registration Department. He has to make sure that the company along with all its resources are insured.
You must also pay all your taxes and have your business name on all legal documents and books in the country. This would save you from closing any future business.
