Many business owners wish to establish a business but some end up establishing a ‘feature’. A business is a going concern; while a feature is a temporary endeavour. Features develop products and not brands. They have structures but no future. It is the aim of every business owner or every start-up owner to grow a unicorn like Unilever, Nestle, MTN and UAC, but unicorns do not germinate without adequate planning, watering and ‘manuring’. The secret is the focus and self-discipline of the business owner. Business organisations are the engines of national development. Business organisations or business names are the avenues for doing business. They are special purpose vehicles (SPVs) of profit-making, employment generation, products and goods making and wealth creation. They are also established to provide services, help individuals and governments to generate income and be socially responsible to their immediate communities by providing assistance and infrastructure on social terms.
Businesses also utilise the raw materials in a nation and are the livewire of banking and finance, transportation, insurance and manufacturing industries. All nations are endowed with refine-able resources – solid, liquid and gaseous, and the wealth of nations depends on how each nation is able to refine and add value to its endowed natural resources. The principle behind wealth creation is that nations must engage the majority of its qualified populace, especially their youths in productive activities, like agriculture, manufacturing, construction, pharmaceuticals, banking and finance, trading, sports, education, private and civil services, etc. Governments are not Father Christmas and cannot meet the financial needs of every citizen. It is therefore imperative that everybody in a nation who is of working-age and who are physically and mentally capable of working should work to generate income for themselves and the government in return for government provision of security and welfare.
Businesses contribute a lot to our daily lives. First, they produce goods and services to meet our needs and consumptions. They also recruit households as labour and provide them with compensation, such as wages, salaries, and benefits. Businesses are everywhere. They can operate in the primary sector to extract natural resources such as in mining, lumbering and farming. They usually produce raw materials, which are inputs for other businesses in the secondary sector, where others operate. The secondary sector processes raw materials into intermediate products or final products. Intermediate products are sold to other businesses to be further processed into final products. Meanwhile, final products are for final consumption without going through further processing to obtain their benefits. Then, some businesses operate in the tertiary sector. They offer services.
Businesses contribute to promoting economic development. In addition, business activities create a ripple effect, encouraging other businesses to emerge, creating more income and jobs in a region. Business growth in a region does not only contribute to job creation, it also leads to improvements in infrastructure such as roads, railways and housing. In addition, health and education facilities, shopping centres, and other public and private services are also developed. These developments eventually grow the economy. Competition among businesses in the same sector leads to lower prices and higher quality goods and services. Businesses must aim to outperform their competitors in satisfying their customers with quality products or services, forcing businesses to be more efficient and innovative. It ultimately makes our lives more comfortable and better because we can get at lower prices, higher quality products.
Some business organisations seek to strike a balance between economic (profit), social and environmental issues. They do not pursue maximum profit and wealth for their owners, but reinvest the moderate profits for social and environmental causes. For example, Grameen Bank, a microfinance organisation and community development bank founded in Bangladesh in 1983 by Muhammed Yunus when Bangladesh was the poorest nation in the world, makes small loans (microcredit or grameencredit) available to the impoverished and rural poor citizens without collateral. The collective efforts of the customers ensured that the total assets of the bank were over $3 billion in 2018. A business’s growth does not depend on the level of the sector a business belongs to. Deel, a human resources (HR) company that has simplified global HR with new full-stack platform, was valued at $12 billion and generated close to $300 million annual revenue in 2022.
In some cases, business organisations empower the people of a community by training them in entrepreneurial skills. They also help their immediate communities to market products and use the sales money to provide more training and build public facilities such as education and hospital buildings. A lot of entrepreneurs are incredible idea generators and hackers (copycats); they have a knack for bridging the gap between demand and supply known as “supply gap”. It is this supply gap that necessitates business development. The problem is that it is not every time that good business idea generates good and profitable business. There are features which differentiate a business from a mere feature. A feature only pays salaries and wages of workers and generates just enough profit to compensate the owners (shareholders).
New businesses often fall into the trap of writing off existing businesses as too big to satisfy the masses, uninventive to know what customers want and too incompetent to deliver quality products. But this is not completely true. Existing businesses are usually experienced and manage risk in an efficient manner. They grow in a sustainable way! If the turnover of an organisation is not enough to allow investment plough-back, or the management of an organisation does not believe in “re-investment”, the organisation is a feature!
To be a business and not a feature, your organisation must be planned not to depend solely on another company (monopolist) for its supplies. If it does, your organisation will not be able to grow as it is at the mercy of its sole supplier. If there are buoyant sales, your supplier may decide to start production of the products your organisation is producing. Your company should not also depend on only a customer (off-taker)! If your organisation has only one customer or client, it can die anytime the customer decides not to do business with it. The market size for businesses is big, while that of features is small. A successful business is run by visionary leaders, innovative management and motivated workers. A business has a master plan and timeline. They refuse to go into extinction like the dinosaurs because they adapt to changes and exploit different situations profitably.
- business a.m. commits to publishing a diversity of views, opinions and comments. It, therefore, welcomes your reaction to this and any of our articles via email: comment@businessamlive.c
