SEC-S20W2 | My Business Ideas |Capital Management
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It feels good to be starting this week's contest with business. I missed that of last week because of a lot of engagement on my path but am glad am here this week. Let me commend our dear professor @dove11 for putting up this beautiful lecture.
Capital sourcing and management is vital to the startup, growth and expansion of any business be it a small scale business, a medium or larger scale business. You need capital to get it up and running. In this contest I want to share my thoughts in line with the guidance given. Let get in guys.
Sometimes earlier this year, I ventures into a business. There are quite a number of things I did as business although not directly mine as I had to manage a chain of business for someone. But the one I would like to talk about which I personally took interest in supervising and overseeing is that of ICE BlOCK production business.
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The business is kind off an hot cake in this part of Nigeria and that's because the power supply here is poor and affect people's business especially businesses that has to do with "cooling" of items. I then leveraged on this deficiency and decided to make ice block and sell to those who are into business that has to do with it.
We Started with an initial capital as low as N10,000 in Naira, about $7 or 37.5 Steems since we were just about experimenting it. This amount covered the;
• Transport fare to where we have our freezer
• The cost of buying water per bowl
• Purchase icing nylons for Ice block.
• Miscellaneous.
The design was that the initial capital will get us running for the week and bring in a little profit which would be ploughed back into the business to keep it running. We didn't want to go all out with a huge capital outlay. The beautiful thing is that we already had a freezer we used for frozen food when this ice block idea came hence the reason why I didn't factor in the cost of freezer, if not the initial capital will be about N800,000 Naira, about $486 or 2996 Steems.
I have no doubt that you're very knowledgeable in this field for bringing up the aspect of profit and loss statement, many people run their business without keeping appropriate account to know if they are making profit or running at loss. I think the quickest way for a business to fold up even before it sees experiences lime light is for it not to have a proper profit and loss account which should be kept periodically. • Are you earning profit or incurring losses? Starting the ice block business wasn't as smooth as I thought, I think it typical with every new start up, the profit we envisaged wasn't as robust as we thought and that dues to some unforseen challenges we had while trying to implement this business which of course was in it experimental stage. In a nutshell we only managed to be above the break even level in the first few months of the business. • What are your plans to make your business a more successful one? My plan is simple, since it was a business I personally handle and saw the many challenging setback I faced.I took note of them and also came up with a corresponding solution, some of which seems to be a bit beyond my reach for now. To make the business more successful, the following are the action point; a. Getting a more sophisticated freezer which could ice block to fullest in few hours to meet demands.
b. Steady water supply to ease the ice block production process. c. Getting a more economical means of transportation which would not eat into my profit. d. Lastly I need to increase the level of demand by reaching out to more people out there who are in need of my product. • Are you reinvesting your profits or using them for your personal use? It's just took early to start withdrawing the little I see as profit for personal use and that because the business is yet to be rooted. Everything I got was ploughed back into the business so it could grow. One notable thing I think I am able to do is that we never had to put in a fresh capital because of loss or some unforseen circumstances.I was able to maintain the initial capital for months, and also used the process from it to keep the business running • What are your expenses for your staff and establishment, if any? We had no staff other than myself, the only thing I think I did for myself was a take a little portion of whatever came in as profit to slightly refresh myself when there is really a need to do that and it not everyday. The reason is not far fetched, I was helping the business gain it ground. I can only start pulling out as much as I want when the business is grounded. I would be lying if I said I took loan to start up this business, as you can see, I started with something very little initial that one could actually raise in days. I also think I explained why the capital was not very huge in terms of finance. The reason is because the main machinery for the business was already on ground before the idea for this business came. If not, I might have opted to go for a loan... something am not really a fan of anyways. Collateral security is another way business men and woman raise tangible amount of money for their businesses. Financial institution like banks would always request for a collateral before they grant a particular request for loan and whatever collateral that would be demanded of you by them would be equivalent to/more than the amount you're requesting to get from them. For example if you're requesting for N100,000,000 (3,745 steems) to start up a lucrative business, they might ask you to bring your land document worth the same amount of more just to secure the loan given to you to start up your business and of course you would have to pay back with interest.
Like I mentioned earlier, I am not really a fan of getting loan to start a business or use any of my property as collateral for getting certain amount from financial institutions and am not against people who do either, of course a boss of mine always resorted to doing this each time he has a major project he wants to embark on . I guess this part of his is what I didn't learn from him because I don't really like the idea of loan and collateral especially for a new business you have not fully understood. What happens when you default due to one reason of the other, it then means you stand the risk of loosing you house, office, car, land or whatever you used as collateral. Starting and running a business is really a serious issues that needs your all, you need to dedicated your time energy and strength to see it work. There are times one would have to obtain loan for expansion or to keep the business in business...lol. Okay, I think I need to dropy pen at this point but before I do, I want to invite @m-fdo @rakiya @radleking to this contest. Gracias! Regards |
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https://x.com/lhorgic1/status/1836053256218247441
Upvoted. Thank You for sending some of your rewards to @null. It will make Steem stronger.
This post is awesome 👍. Reading through I can see that there's no business without loss be it small or big. The ability to control the loss makes one a good business person. I can agree with you on starting a business with loan, to me it's a turn off. Unless it's a grant without interest.
TEAM 4
Congratulations! Your post has been upvoted through steemcurator06. Good post here should be..Saya sangat suka melihat semangat anda dalam menjual es balok.
Your great analytical work of art in this article is a well appreciated, you detailed your explanation sharing your approach to growing your small scale business, adjusting by reducing cost and implementing approaches to grow the business, which consisted of getting the appliance to reach more audience and reach demands too. I'm glad you shared this article and success in the challenge my dear friend.