ENTR FPX 5412 Assessment 1 New Business to Consider ENTR-FPX5412 New Ventures and Entrepreneurship Starting a New Business

Starting a business offers various advantages, including being your own boss, reaping the rewards from success and growth, and having the flexibility to choose your working hours. When self-employed, you control your own future and decisions [CITATION Wil \l 1033]. The rewards depend on your business plan; they might include financial success, personal growth, or simply the satisfaction of building something from scratch. Additionally, the flexibility in setting your own hours is another benefit, though initially, long hours may be necessary. As the business grows, your working schedule can become more adaptable.

However, the risks involved are just as significant as the benefits and must be carefully considered fAor a successful venture. These risks include startup costs, competition in the marketplace, and personal strengths and weaknesses. Key questions entrepreneurs should ask themselves include:

• Assess your strengths and weaknesses: Is self-employment right for you?
• Determine startup costs: Can you cover these on your own, or will you need external financing such as a loan?
• Research the marketplace: Have you considered your competitors and how your business will succeed? [CITATION Wil \l 1033].

Entrepreneurs must decide what type of business they want to start and evaluate what factors could contribute to their success. A common saying is to “do what you know.” Reflect on the work you’ve done for others and consider how you can package those skills into services or products [CITATION Mon \l 1033]. Thorough market research is essential for developing a solid business plan. It’s crucial to understand your own skills and the marketplace you will be entering, which will enable you to stand out from the competition and appeal to your target customers more effectively.

Buying an Existing Business

Purchasing an existing business comes with benefits such as an established customer base and market reputation, which provide a solid foundation for growth. One of the advantages is a proven concept; as a buyer, you already know that the business model works [CITATION IBB \l 1033]. Additionally, you inherit relationships with existing customers who have previously supported the business. This allows you to focus on improvements and expansion rather than starting from scratch.

However, risks are still present when buying a business, including the potential need for immediate changes, a poor reputation, or difficulties in making the business your own. For instance, if the business was near bankruptcy, urgent changes might be necessary. A negative reputation could also hinder success, making it harder for you to establish the business as your own. These are important considerations when evaluating whether to purchase an existing business, especially if it is struggling in the marketplace.

Buying a New Franchise

Starting a new franchise comes with several advantages, such as access to a support and education system, reduced risks, and a loyal customer base. Franchisors typically offer extensive training and support to franchisees, helping them understand the company’s business model. By joining an established brand, franchisees gain industry knowledge and experience that would otherwise take years to learn [CITATION Rev \l 1033].

There is also lower risk because the franchise is backed by a larger corporation, and franchisees benefit from an established customer base and potential employee pool [CITATION Rev \l 1033]. Well-known brands, such as Starbucks, often guarantee a steady customer flow, provided the franchisee maintains good customer service.

However, the risks of owning a franchise include high startup costs, limited creative control, and a lack of financial privacy. Franchises can be expensive to launch, particularly for well-known brands. Additionally, franchisees must adhere to the company’s business model, limiting their creative input. Franchisors also collect financial data from franchisees, meaning that franchisees have little privacy regarding their business’s finances [CITATION Rev \l 1033].

Which Model Suits You Better

Each business model offers unique benefits, but for our situation, starting a new business from the ground up seems like the best choice. Currently, our woodworking endeavor is more of a hobby, and we’ve held off on transitioning it into a full-fledged business until I complete my education in business. We produce various items, from furniture to decorative signs, and my husband, a veteran, has found woodworking to be a therapeutic activity.

We hope to grow the business enough to open a physical location where customers can visit. In our current location, our home décor items cater to a rustic, western theme that resonates with the local market.