By Tanay Bhattacharjee
March 30, 2024
Dear Graduating Students
What next?
A lucky few of you have already had that figured out. But those who haven’t, are largely faced with two options: a. higher studies b. find a job.
I would like to give you a third option – start a business.
I am not talking about the Shark Tank kind of business. I am talking about the unglamourous country cousin of startups – small business. A departmental store, a bakery, a medicine store, a furniture manufacturing unit, get the idea?
Do you find yourself thinking, “Huh! Who wants to start a dukaan?” Believe me I understand. In our society the perception is that only a person who has failed to get a job, starts a business. Somehow a person owing a small business is not seen at par with, say, a person doing a government job.
The reason for this negative perception of small businesses in our society is that
a.) most people aren’t aware that a businessman (even if he starts as a small business owner) can earn equally, if not more than his government job counterpart.
b) A whole generation or two has seen businesses go broke pre liberalization. As a result, they think that a government job is a secure, even if less fulfilling career. Hence, they still want that government job for their children.
c) while the process of getting a job is straight forward and well know, the process of starting and running a business is not so well known, unless one already has had a businessman in the family.
While everyone knows the perks of government jobs, starting and owing a business is altogether a different experience.
For one, you are your own boss. You don’t have to answer to anyone. While starting a business is tough, once you can get it running the earing potential is far more than in a job. Getting to work with a team of your choosing is another high. In a job environment you don’t get to choose your boss nor your team. While a 9-5 job is stable, it can very quickly become boring and tedious. Every day presents a different set of challenges in a business.
Above all, nothing can beat the satisfaction of being able to generate employment for another person. Yes, starting a business allows you to be an employment generator.
But how does one start a business?
The first question to be asked is: What business to start?
No, not a restaurant or an eatery. Every college student wants to start that (Just joking!).
To come up with a business idea, try to see if there is a problem faced by many people that you can solve. Or if you yourself are facing a problem and solving that problem for yourself will also be a solution for many people. For example, you might observe that you have to go to a different area to get medicines. Now flats and several houses are coming up in your area. Opening a medical store can become a good opportunity.
Another way of coming up with an idea is to look for a skill that you have, which can be translated into business. For example, having the ability to write code is one such skill. You can write software for local schools/colleges, local businesses.
In a place like Agartala distributorship of established brand of FMCG, consumer durables and electronic goods, works quite well. In the outskirts and rural areas businesses like fishery, piggery and poultry farm thrives when done well. These businesses do not require much capital to start. Although not glamorous, these businesses can be very rewarding.
The point I am trying to make is that there are many opportunities. But you should start something in which you yourself are deeply interested in. Also, on the other hand, it’s not wise to start something simply because only you are interested in it.
You have to find out whether people will actually pay for your product/service. So, it’s better to test whether people will pay for your product or service before launching the business full scale. How do you do that? Ideally one should build a prototype.
Take for example, you decide to start an online shop for indoor plants or you figure out that garden plant market (floriculture) is not organized. So, you decide that an online market place for garden plants will be a good business. To test the idea, you can just build a single page website (or a landing page) and then put that out in front of your prospective customers, without spending much money though a social media campaign. The response will give you an idea whether there is a demand for garden plants.
Here its important to mention that while an online business is easy to start and also does not require a large physical space (in the example above, you may need a space to store saplings), an offline business will need a place. If you don’t have any, you might need to take one on rent.
Of course, not all ideas can be tested beforehand but it’s important to have an idea of the demand of your product/service in the market you are aiming to sell.
The next step is to find one or more partners. One can have a partner at the idea stage itself. While there are proprietary business firms but it helps to have partners to share the pressure of the enterprise. Alone it is very easy to give up after the first few setbacks
The idea is settled and tested. What’s next? A business plans. Now that might sound a bit daunting to non-commerce students, but it isn’t. A business plan is a rough estimate of the approximate expenses and revenue for a period of time (usually five years). Now if you can’t come up with a business plan yourself try searching online for it or take the help of your commerce department friends.
Although a formal business plan is not necessary to start a business but a rough idea of the numbers is absolutely essential for your own understanding. Also, a formal plan/estimate is required for getting a loan from the Bank.
The business estimate will tell you the amount of money required to get the business up and running. But as a student just out of college, chances are that you don’t have any money. So, the big question: how do you find the money to start the business? Ask your parents/relatives. At this point you might just be laughing but let me lay out my case.
Small businesses usually require capital in the range of Rs 3 to Rs 5 lacs. Now if you could get that money from your parents or relatives it will give a huge boost to your business because it will be interest free. And if you understood the numbers in the business plan then you can appreciate difference it can make to your profits. If that option is not available then one can approach a Bank.
Now, before one approaches a Bank, one must get a trade license and other legal necessities like GST Registration (if applicable), PAN Card, Udyam Aadhar, etc. After one applies for a loan, the Bank will make an appraisal of the proposal and if they find it viable, they may decide to lend the loan amount.
Also, there are various government schemes that give subsides to entrepreneurs like the Prime Ministers Employment Generation Programme (PMEGP) or the Swabalamban Scheme of the Tripura State government to name a few. Benefits of those scheme too can be availed.
Idea is finalized, tested, team formed, legal formalities completed, money raised. What next? Time to launch. After you launch, there will be enormous challenges. You will learn things that no MBA course can teach. If successful, you are on your way, if not, the sheer experience of starting and managing one’s own enterprise is invaluable. Even if you fail and decide business is not your thing, having the word “founder” in one’s CV certainly won’t dimmish your chances in the job market.
The author works in a public sector bank.
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