Selling to other businesses
Business-to-business (B2B) enterprises, such as those selling market research, database management, corporate clothing, management consultancy, telemarketing or graphic design, involve one businessperson selling to another. The attractions are that you’re dealing with other people who have a definite need and usually buy in relative large quantities and at regular intervals. For example, an individual may buy envelopes in packs of a dozen a few times a year, but a business buys scores, perhaps even thousands, and puts in an order every month. Corporate customers are harder to win, but are often worth more when you have them. And unlike private individuals, businesses like to forge relationships that endure over time.
Opening all hours
Conventional shops, restaurants and the like have long opening hours and have to meet the expectations of increasingly savvy consumers, whose access to the Internet has made them aware of competitive prices as well as high specifications and standards of service. The upside of any form of retailing is that you’re almost invariably paid up front. But just because you get the cash in your hand doesn’t mean that you don’t have to meet exacting standards. Customers are protected in their dealings in a myriad of ways and if you fall short of their legal entitlement you can end up with a bigger bill than a simple cash refund.
One of the attractions of manufacturing is that you have a greater degree of control over the quality, cost and specification of the end product than a retailer or wholesaler might. But with those advantages come some hefty penalties. Factories, equipment, stocks of raw materials and employees are costly overheads. You have to incur these expenses well before you’re certain of any orders – an unlikely way into business for someone without previous manufacturing experience and a deep wallet. Such owners also bear some significant risks towards their employees.
Service industries now dominate the British economy and account for around 70 per cent of gross domestic product (the value of the goods and services that the country produces). Services include financial intermediaries, hairdressing, real estate, computer services, research and development, education, health and social work, refuse disposal, recreational, cultural and sporting activities and an extensive range of other activities where no physical goods play a major part in any transaction. In truth, however, most manufactured goods include a service element, though the business functions are often separated. For example, manufacturing businesses produce cars but are quite separate from the garage chains that repair those vehicles.
Clearly, if you live in a cul-de-sac at the end of a narrow lane surrounded by other houses you’re unlikely to be allowed to manufacture using hazardous chemicals and have articulated vehicles delivering and collecting in the middle of the night. You also have to consider how your neighbors will be affected, even if you’re legally allowed to operate your business.
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