Diasporian News of Wednesday, 21 November 2012
Source: Akua Gyamfuaah
By Akua Gyamfuaah
If you have ever thought of running your own business or social enterprise, perhaps working from home and progressing to commercial premises, then this article is for you. These brief notes are written from a UK perspective, but includes links and information from other diaspora bases and Ghana wherever possible.
It is worth describing social enterprises, as they have been in existence for decades, but have come into public view in recent times. Social enterprises are businesses where the profits are not distributed to the owner(s), but re-invested in the business for social or environmental benefit. In the UK there are specific legal forms that can be adopted by social enterprises, including the Community Interest company that has an “asset lock”.
Below are a few ideas to get you going, whatever type of business you choose to set up. They are suitable for both men and women, do not cost a lot of money, and have a short training period.
Things to consider before you start
You need consider some issues, depending on your circumstances and personality. These include:
Here are a few questions to seriously ask yourself, with as much honesty as possible:
Why do you want to set up a business or social enterprise?
What do you really enjoy doing, including hobbies?
Could one aspect work as a business? How?
What do you want to get out of a new business? It may not be money alone…
Are you happy working (or starting) on your own?
Can you afford some time out to learn a new trade, craft or profession?
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Are you prepared to work long hours to build your business and your particular brand?
Do you enjoy serving customers or clients without feeling negative about yourself?
Do you have family, friends or faith group members who can give you some support if the going gets tough?
Can I live on the proceeds of this business?
About the Business
Some of the questions you need to ask yourself about the business you want to go into are:
Who will my customers be – men, women, teens, children?
What are they looking for? How much are they prepared to pay?
Who else is providing this product or service, how can I compete in this market?
How big is the market? Is it getting bigger or smaller?
Where will my business fit in?
Where should I locate my business?
Do I need a license, certificate or special training?
Do I need insurance?
Do I need special equipment or premises?
How much money do I need? Where will it come from?
The answers to these questions will help to form the basis of your Business Plan. It is always worth writing a Business Plan, because it helps you to think through the most important issues. It also helps if you decide to approach a bank or potential lender or investor about finance for your business.
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Just a quick aside: most lenders and investors prefer to see a plan that you have prepared yourself, and can answer questions about. When I worked as a Fund Manager, we could always tell the business plans that had been prepared by professionals without much of the applicant’s input. This is not to say these plans are bad, but that if you choose to use someone else, whether professional or friend to help write your plan, make sure that the information you give them is from your own understanding of what you are intending to do. Also make sure that what they write down makes sense to you, rather than fitting into a template. If possible, get a friend or someone you trust to read and ask you questions about your business plan before you approach a bank, other lender or investor.
However, a business plan is not just for the purpose of borrowing or seeking investment, but can be a useful ‘living’ document which you update as you go along. It can help to keep you focused, chart your progress, and encourage you to see how far you have come, as you go on this journey towards setting up in business.
If you are ready to start a business, have some money saved, and would like a tried and tested ‘formula’ for success, then franchising may be a useful avenue to explore. This is also an area that most banks and commercial lenders understand and are more willing to lend money on. Some banks have specific Franchise Funds or departments, and it is worth calling to find out if they would support your franchise before you sign up for one. Often they may have had experience of dealing with previous franchise owners.
Choosing this route involves putting more money upfront before you see a return, so it is worth investing in some legal advice to look over the Franchise Agreement so you understand what is involved. It is also worth asking for, and speaking to current Franchisees and visiting their premises to get a feel for the product or service and the level of support Franchisees get from Headquarters.
Who do I need to tell?
In the UK you need to inform Her Majesty’s Revenue and Customs (HMRC) within 3 months if you are starting a new business. Some people find this
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difficult, but it is far easier to do than to avoid. This is because when you do, they will often help you to start your record keeping in the correct way, avoiding problems later on.
Most businesses that require touching or some kind of physical contact with the human person require licensing, certification or accreditation: these range from healthcare to hairdressing, food to tattoos. In some countries, such as the UK, local authority Environmental Health departments need to be informed if you are taking on premises to carry out such businesses, and will often visit the premises to ensure that they are suitable for the purpose. If you are not sure whether your business comes under this category, it may be worth asking just so you are certain.
If you are taking on business premises, you will also need to consider business rates, which are payable to your local authority, and can sometimes be as high as the rent on the property.
We shall re-visit some of the key aspects of business planning in more depth, in the near future, but for now here are some business ideas you may want to consider.
The prices, times and amounts given are for indication only, and may differ at the time of your purchase. A listing here does not mean approval of a particular contact. Always double-check and be careful before you send any money to anyone.
Hat-Making or Millinery
Beginner’s Training Cost: £135-£445
Duration: 1 day – 1 year
This is a craft worth learning because as Ghanaians our traditional fabric head-gear for women is a kind of ‘hat’, and could be manufactured as such. In addition, you could make European-style hats and Fascinators.
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Some training courses are only a day or two long, with the opportunity to go back and learn more. Many have specific dates, so it is worth checking beforehand.
Training Courses (UK and USA): www.darlingtoncollective.com
Level 4 Higher Diploma: http://www.kcc.ac.uk/fashion-and-millinery/millinery/
Supplies and Equipment: Fabrics, Combs, Ribbons, Bases, Flowers, Feathers, Hat Wire, Elastic, Veiling, Felt and other accessories. Try Randall Ribbons: +44(0)1582 721301
Tel. (03)9504 4476
New York: http://www.hatsny.com/
Ghana is the second largest producer of gold in Africa, and yet much of that gold is exported as bullion, rather than made into fine jewellery, which can create more jobs for many people, including young people.
Beginners Training Cost: £125
Bespoke Jewellery: £45
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Equipment: Jewellers Toolbox - £80-100
Rotacraft and Polishing machines: £200-400
Bright Lights and Magnifier: £50-60
Equipment and supplies:
http://www.jewel-toolcraft.co.uk/ Tel. +44 (0)21 212 2446
Perfume and Cologne Making
Ghana has a great variety of flowers, aromatic plants and shrubs, fruits and spices such as cloves (Wisa) which can be used as the basis for perfumes. From palm wine and other sources we can also extract alcohol, another required component. However, if you live in the global North, then the essential oils and alcohol for perfume making can be obtained from various suppliers.
Training: 1-5 days
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Equipment and Machinery
$2,000 -$20,000 http://gzflk.en.alibaba.com/
Ghana already has a tradition of soap-making which can be built upon and developed further both for home consumption, for export, and for production by Ghanaians in the Diaspora. For soap-making we have a range of oils such as coconut, palm, groundnut, shea butter, palm-kernel, cocoa butter and others.
We have beautiful natural containers such as coconut shells, leaves, corn husks, pods, calabashes and gourds. Why not use them to provide rustic, hand-made high-quality products, which command higher prices?
2-day Course, including liquid soap, labelling, etc £250
Do let me know how you get on. All the best,