Business Startup
Small Businesses and Entrepreneurship
Startups can be very fruitful if you know where to look and where to start. This is not entirely about money (although it is crucial) because you must know where you can spend and invest in. The business idea is vital too. Malaysia has one of the largest and most active groups of entrepreneurs that are involved in startups.
Understanding the market
In whatever business you do, big or small, you need to do some homework! This is crucial because you must fully grasp what the market is before starting out. Among those that you need to know include:
- Market catchment – who are the customers and where are they?
- Readiness – Is your product or startup ready for this market and vice versa
Passion vs Business
There must never be a mixture of business and passion. This is because either one would be killed off eventually. When you venture into your startup:
- Are you doing this because you like what you do or are you doing what you like?
- Does your product or service come with sustainability? How long can you last in this market?
- How familiar are you with the Malaysian market?
Do you have government backing?
Not all products and services offered in the country are fully allowed and supported. While niche products can be quite profitable, you need to have the endorsements from the relevant agencies and authorities before starting. In fact, you should find out if there are certain backing (funding or otherwise) from the government before starting.
- Check for agencies like SME Corp which helps startups and small businesses
- Funding from local agencies like Cradle and MAGiC
- Company Commission of Malaysia or CCM on the legitimacy of your business
Laws and Regulations
This is very important because it is the first thing you need to do before your business can start.
- Company registration is the first and most important. If you have foreign partners, then you need to get this sorted out
- If you are planning to import goods, then check for taxes and tariffs.
- Registration with income tax
Players in the market
A lot of entrepreneurs like to think that they have the best product on the market. They become too ignorant that they might have competitors who are already in the market (sometimes longer than they can imagine). Before anything, you must know who your competitors are and if they are there and how they are selling.
- Who is offering the same type of products or services as you?
- What is the price point they are selling at?
- Which income level are they targeting?
How much do you need?
This is where you must now work out the budget that you need for your startup. To do this, you need to make a lot of calculations. What is a business without a good financial plan?
- ROI or Return on Investments. This needs to be calculated and how long before you break-even?
- What is the initial cost?
- Consider all factors here including salary needed to pay your employees, overheads and allocation for future expense
Source of income
Your objective here is profit for sure. So, where is your income coming from? To begin with, your first channel must come from the products you sell or services you offer. But if you rely fully on one channel, it might be a problem during the dry months.
- Find additional channels that might provide more income
- Prepare plans for the dry months when sales can be low
- Consider partnerships with other players
Find out about resources
Once your business starts, you might not have the time to waddle around in circles. Before starting up, make sure that you have done enough homework so that:
- You know where to get the resources you need.
- You should know who your suppliers are and the alternatives
- Where is the nearest stationeries shops or outlets
- How about payment for amenities like electricity bills, rental and such?
- The convenience of your location
- How about warehousing facilities?
- Should you have a special allocation of funds from somewhere?
