CHARACTERISTICS OF A GOOD BUSINESS IDEA

·       Easy to manage and involves minimal risk.

·       Does not require excessive capital investments;

·       Offers a good returns on capital; In other words it should be profitable;

·       The idea has scope (range, capacity) for growth, expansion and diversification;

·       Comparative with owner’s goal and interest. It should fit within the owner’s goals and interest so as to always be able to motivate the owner.

·       Not against expectation of the society. It should fit within the expectations of the society: incorporate corporate social responsibility, cater for all the customers’ needs and wants.

·       Has a short gestation period. It should have a shorter payback period. This is the time it takes an idea or business project to recover the owners capital investment.

·       Have a readily available market. It should be started to serve a given range of customers and this is only successful when a thorough market analysis is carried out to produce what is exactly needed by customers.

·       Easy to exit when necessary. In case of problems in the business operations, then it should be easy for the business owner to change from one line of business to another (exit strategy).

      PROCEDURES OF STARTING A BUSINESS

·       Identification of a business idea: This the time when you identify an opportunity in the market and you start thinking of how to exploit it: In business and entrepreneurship in general ideas are starting points which are eventually developed through innovation to turn them into marketable business ventures in form of goods and services.

·       Development of a business plan: This addresses issues when you start preparing yourself to implement your idea. At this point you are gathering the necessary information, data and resources to help you get started and implement your business idea successful. You set targets and develop strategies to achieve those targets in relation to your plans.

·       Location of a business: At this point the entrepreneur is preoccupied with where to locate his/her business to ensure easy accessibility by customers, supplies and other stakeholders. Location is an important aspect because it must be based on the market conditions in the area. For example are there customers to buy your products in the area you want to locate the business etc.

·       Registration of the business (Choice of the business organization and Business name): The entrepreneur chooses the business name which must have a business meaning and which is acceptable legally. At the same time you decide on the type of business you want to start e.g. a sole proprietor, partnership etc.  In Rwanda this is done by RDB which is responsible for investment development and promotion.

·       Trading licenses / permit: Actually from registration you are given documents which include certificate of registration which means that your business is registered and known, certificate of trading meaning that your business is legally accepted and allowed. It is at this point that you are allowed to start operating your businesses.

 ·       Start-up and management of the business: Here you open up your business and start serving your customers. However it requires hands on management to make sure that the business is run and managed according to how you perceived and initiated the idea and most importantly in relation to the targets and goals in the plan. It also calls for excellent business ethics to ensure survival, growth and profitability of the young business.

NB: All entrepreneurs are business people though not all business people are entrepreneurs. Entrepreneurs tend to be more innovative than ordinary business people and end up developing a business plans.

Ways of Protecting Business ideas

a) A patent

A patent is a grant of property right by the government to an inventor. It is issued thought the commissioner of patent rights, and the most common type of patent is called a utility patent. All patent however, have the distinction of being assets with a commercial value because they provide exclusive rights of ownership the patent holders.

Patents are exclusive property rights that can be sold, transferred, or used as collateral much alike other valuable assets.

The patent law stipulates broad categories of what can and cannot be patented and in the words of the statute any person who “invents or discovers any new and useful process, machine manufacture, or composition of matter, or ay new and useful improvements thereof may obtain a patent”. Anything that is patentable must be new and useful (must have some demonstrated function)