Sun Oct 23 05:26:40 SAST 2016

Start your company for the right reasons

By unknown | May 31, 2007 | COMMENTS [ 0 ]

A change of attitude could help you to sustain and expand your business.

The informal business sector is an important part of the economy, says JH Martins, a professor at the University of South Africa's bureau of market research.

"The shortage of productive employment opportunities in the formal sector compels people to fend for themselves," he says.

Many people get into a small business because they are unemployed, not because they have identified opportunities.

But unemployment is a bad reason to start a business, in which you will be subjected to many pressures and will require a great deal of dedication, he says.

Research has shown that many small businesses fail not because they lack potential, but because most small-business owners get into business as an alternative to employment.

More than eight in 10 of the people Martins interviewed started their businesses because of unemployment.

"Unemployment as the motive for starting a business ... presupposes a high potential for business failure," Martins says.

"Though a small business can be seen as a residual employer, it has an important role to play in improving welfare and alleviating poverty. Managed properly, a small business can create some wealth and generate employment."

So, instead of considering starting a small business because you don't have a job, decide what you want your business to be and then look at the role its could play in your life and in that of the community around you.


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