65% of business in India is run through proprietor ship and many small businesses are run without any government registration. This means very few businesses are registered in India under the Companies Act, compared with Proprietorship businesses, this figure is very low. If we compare the business, big companies work on more profit margin than the lowest level companies.
This akada as the company gets smaller its profit margin decreases and in the end the retail business we see only runs on 2% profit margin. If the question arises, why can’t more people make big companies so that they can get more profit margin. We can say the answer to this is lack of self-confidence, the fear of not getting success is always there.
Due to lack of knowledge of how the business can be increased in this, or due to wrong information, this could be the reason for not trying to grow the business. Today we will see here that why most of the businesses are not able to grow, we will try to find the reason for this and what can be the solution for this. Anyway we try to do our business in traditional way and because of lack of business culture in our family the next generation of family prefer to do job instead of business.
Because of which people who grow their business all their life die because of having no one to run the business later. That’s why here we will try to find solutions for all these reasons so that you can understand how to grow your business.
History of Business Culture –
Before the British came to India, the barter system was running very loudly in India. In which people used to feed their stomachs by giving services in exchange for goods. There were currencies in the economy, but very few people could see them. India’s economy used to reside in the village where agriculture was the focal point of the economy around which the whole economy ran. For the last 2000 years, trade outside India had almost stopped, so it had stopped getting profits by extracting surplus production.
In the 16th century, the British East India Company established the first colony in India in Surat, which laid the foundation of today’s modern trade and built its transportation network across India and some of India’s own merchant community as their representatives in every village. But he built an economy by establishing, under which he brought raw material from all over India to Surat and sent it to Britain and earned profit by making finished products from Britain to the whole world. Under this strategy, he increased his business by catching some people of India.
Today, we some business community could establish dominance in the economy of India, because of this, a business culture of doing modern business was created in that society, due to which they became expert in doing business and increasing it. The Britishers had been roaming all over the world doing business, till that time their method of doing business had become more modern, coming in contact with which Indian businessmen also became experts, but the rest of the society remained away from it, due to which this business culture could not flourish in them.
That’s why today the society where there is no business culture yearns to get a government job and a job in a multinational company but does not want to do business. Therefore, if the previous generation builds a business by working hard for 20-30 years, but its next generation does not take interest in expanding that business, its attraction becomes to get a job in foreign companies.
Why do most businesses remain small in the market? –
We should also have a big company, it is the dream of all businessmen, but this dream of very few people is fulfilled. The reason for this is that instead of focusing on how to grow the business, many businessmen become so busy in all the work of their business that without their initiative, the business leaf does not even move, it shows that you do not trust any employee. You want to do all the work under your own control.
That’s why most of the companies in the market start at a small level and end at a small level only. The most important reason for this is lack of self-confidence, taking your decisions on the knowledge going on in the market, not working on research and development, this is a habit in most of the people, so business does not grow. Doing a bigger company means paying more tax to the government and it reduces your profit, this is the biggest confusion among the business people, that’s why their business does not grow.
No one likes to do partnership business in our society, because of this we do not have complete control over the company and relations in partnership get spoiled, so no one thinks of doing business in partnership. By forming a private limited company, there is a lot of government interference and more taxes have to be paid, so generally many businesses do not start private limited companies. All these things can make the company big, but we do not do this and believe on hearsay and run the company as it is running all our life and we will also have a big company, it remains only a dream.
What is the difference between Proprietorship and Company –
Proprietorship is regulated under the Shop Act law of the state, in which more government paperwork is not required to be given while forming a company under the Company Act law. In forming a big company, there is less correct information and more confusion, due to which most of the business He likes to run his business at the level of Proprietorship.
In which our responsibility towards the employees increases, more taxes have to be paid, government paper documents increase, due to many such illusions, no small company can become big and prefer to do business in an unprofessional way at a small level. That’s why despite having a dream to grow the company, many such fears prevent you from taking good decisions and wrong advice prevents you from growing the company.
We rely less on ourselves and more on the decisions of people, that’s why we are not able to grow. By getting registered under the Companies Act, you can do your business anywhere in India, which increases the scope of our company to do business. In Proprietorship, we can do our business only in the state in which we have registered.
What should small companies do to grow their business –
When we think of expanding our business, first of all it is necessary to have faith in ourselves that we can do this, for this we need to increase our knowledge, for this we need to revise, all this information is available on the internet. Try to bring a lot of changes in your current business which will be the beginning before increasing the business. For this, we have to pay attention to some of the following things.
- What is the actual net profit of the business, that figure has to be extracted, pay attention to finance management.
- We have to make a good business profile so that we can get new orders and big companies can give us work from their profile.
- Big companies see in your profile whether all the registrations of your government have been done or not, according to that they think whether to give you work or not.
- Registering a company under the Companies Act is not a bad thing and there are no more such compliances that cause you trouble, but your profile becomes stronger.
- If you take care of the employees considering them as the asset of the company, then the time that you spend in working throughout the day, you can focus on increasing your business by putting that responsibility on your employees.
- The biggest problem to grow the company is the capital which we can raise by taking a new partner company, or by taking a loan from the banks, we just have to remove the fear of failure.
- Online platforms and social media platforms should be used to grow the business.
- There is no problem in recruiting good experts in your company by paying more money, this is an investment which will help in growing your business.
- For a temporary period, you can hire an expert to help you grow your business.
- By using this 80-20 system, 20% of the companies which give you more business, we have to pay full attention to these companies, this will save our time and money, which will make it easier for us to grow our business.
- The quality of the company’s products or services has to be kept good so that the goodwill of your company can increase in the market, it proves helpful in increasing your business.
- We should get our profit even when we are not working, this situation gives you success in business, so you have to find such income sources in your business which can give you money continuously.
- The company’s balance sheet does not give you the correct information about your business, so keep a separate record of what is your correct profit.
- Spend as much as possible on technology for business, which brings accuracy in business and you can give your time to important work.
Online platform and social media –
In today’s era of technology, online platform has to be used to increase business, for this it becomes necessary to have basic knowledge of technology, if there is ability to hire a tech expert, then it is very important to invest in it. Facebook, You can use social media like Twitter Instagram to grow your business. If you create your own website, then it is the best solution to increase business on online platform on which you can sell your services or products online.
Sites like India Mart can prove to be very helpful in increasing your business. In the coming time, the whole world is going to come on digital platform, so looking at the trend of time, it becomes necessary to change with time, so if you want to grow your business, then you have to use this platform. The medium of reaching your product to the customer is also available on the internet, so by using it you can increase the scope of your business.
Attending business seminars and watching business news updates –
If you want to stay updated in business, seminars are held in different cities to be a part of them and many websites of business updates are available where new updates about business are available. If you attend that, you will get new ideas to grow your business. Nowadays, webinars are started on different subjects on the Internet, joining such business community from which such information can be obtained.
Understand the importance of Legal Entity –
Most of the businesses in India are run by family businesses on a small scale, so India’s stock market should be more developed than America, but it is not. The biggest problem in growing the business is the capital, which is very difficult to raise money at a small level. The second reason why businesses do not grow is that most of the people doing business themselves do not want to grow their business, it is seen from the point of view of “who will do more business”.
Businesses at small level and partnership and proprietor ship level are done at personal risk and most of the advisors do not tell or do not want to explain to these small business what is the importance of legal entity in business. That’s why people who have this misconception that big business means more tension, this attitude will have to be changed.
Legal entity it keeps the business separate from its personal assets and it is much easier than small business for your business to raise money for business from stock market and market. Even if the business fails, there is no harm to your personal property, winning is your share in the business, as much responsibility is with you. Which helps you a lot in growing your business.
In this way, we have seen here that most of the people start small scale business here and remain small scale businessmen all their life, they are not able to grow their business. Here we tried to find out the reasons for this and analyzed how our thinking should change for this.
The biggest problem to grow business is trust, fear of business failure, ignorance, and lack of knowledge about how to raise capital on a large scale. Must have seen it in detail. The main source of our knowledge is information through the media, learning from people’s behavior and reading books.
Along with this, today we can also use social media and internet to gain knowledge, but most people do not do this and due to not knowing how to keep themselves updated, only other’s information determines their action plan, hence wrong. They take their decisions in assumptions and believe that the level at which they are doing business, it would be right to do it throughout their life and living a safe life becomes the culture of the people.
That’s why here we saw how to create business culture. I hope that I was successful in giving you good information about how business can be increased, if you have any questions about it, you can mail me.