By K. C. Soares, Contributor 
Soares
I HAVE been requested on many occasions by various groups to make a presentation on how to start a business. These are people who are interested in making a contribution to the small business sector but are not sure of how to proceed.
In light of the fact that a significant number of persons have been made redundant over the past seven years and with more redundancy to come and having in mind that small businesses continue to be a conduit for economic opportunities for many workers displaced by redundancy, I think it is necessary that I outline easy and inexpensive ways of starting a business. I will now put forward a few suggestions that will increase the likelihood of success of the business to be started.
The first thing to decide on is the type of business. Here, one will have to ask (and answer) questions such as how will my background/experience help in the business, and what management experience do I have. In addition to these questions, one's direct operational experience and any outside resources/expertise that can be relied on for assistance should be taken into account.
When these questions are answered positively then the next step is to satisfy oneself on the marketing of the goods or services to be produced. It would be ideal to have a business plan prepared by a professional but relatively few can afford the attending fees.
I would suggest that the individual does his or her own survey. This can be done simply by asking friends and relatives to help you identify potential customers and those producers already in the market (competitors). Follow-up should then be done by simply telephoning those who you think will buy your goods/services. From the competitors you will be able to establish a price for the goods/services. Let us take a hypothetical case to illustrate what I have said so far.
John Brown has worked for over 15 years with the government but due to restructuring of his department he is now made redundant. As he is not able to get another job he decides to start his own business.
In deciding what type of business to start, John Brown took into consideration that he was an extension officer and therefore has operational experience with plants. He therefore decides to start a plant nursery. He then checks with his friends and relatives to get their opinion on whether or not plants will sell. If so, where would the likely markets be? With this information John Brown would then call the potential purchasers to find out what plants are usually in demand.
Having been with the Government for so long John Brown would have established good working relationships with the other agricultural officers and, therefore, can benefit from their expertise when he starts his business.
The next step that I suggest in this process is the formation of a company. One of the main reasons for this is that if money is to be borrowed, financial institutions are more willing to lend to companies than to individuals. A lot of persons have a false notion that only lawyers can form companies. This is not so. An individual can form his own company.
To save costs I would suggest that you form your own company by first thinking of a name for the company and then doing a search at the Registrar of Companies to ascertain whether or not the name thought of is available. You may then request from the Registrar of Companies the Articles of Association and the Memorandum of Association of a company already registered that does similar business to what you are about to do. You should then re-do these documents inserting at the relevant places the name of your company to be formed and the name of your directors. A Declaration of Compliance accompanies these documents.
The completed documents should then be taken to the Stamp Office for stamping and then to the Registrar of Companies for incorporation. One will be amazed at the savings using this procedure.
With the company duly incorporated, one can now approach a financial institution for a loan if required. In approaching the financial institution, one should have at least a listing of the expenses involved and the revenue to be earned either monthly or annually. This will help the banker to determine the profitability of the venture.
In my next article I will deal with which financial institution to choose.
K. C. Soares is a former banker and is now a business consultant with Soledad Financial Services Limited. E-mail: soledad@netcomm-jm.com
