Self employment is a concept that has arisen as a result of entrepreneurship. The process of entrepreneurship eventually brings self employment to the fore. The entrepreneur becomes self employed when he begins to derive his livelihood from his business venture. Given that the entrepreneur bears all the risks associated with the business, then it comes as given that he has the right to enjoy all the benefits that ensue from his business venture. This success can be
trickled down, not just to himself, but also to the business and others who are job seekers. In this way, not only does the entrepreneur become a self employed person, he also does something positive for the community employing others.
An entrepreneur can make huge gains if his business is a success. At the same time, should the business experience difficulties, financial or otherwise, then the entrepreneur stands to lose a lot of his investments. This may even lead to bankruptcy.
An entrepreneur may mitigate against the risk of failure in any of the following ways.
- Insuring his business against losses. Losses can be in the following forms
- Co – owning the business with a partner. This option will dilute the ownership therefore it is a step that should be taken with a lot of caution.
- Investing in extra security in the event that the business deals in valuable products.
- Securing the services of a risk assessment expert. This is a preventive measure and will highlight the areas of risk in the business that the entrepreneur needs to be aware of hence make vital decisions.
The entrepreneur puts himself in a safe position both for his business and himself if he does any one of the above. The list is not exhaustive; the entrepreneur can device other risk mitigating measures that are appropriate for his kind of business.
On the other hand the business venture can be a huge success if well managed. The entrepreneur can derive his livelihood from the profits of his venture. This becomes a success story especially in the current economy where many young people are losing out in the job industry even with the relevant qualifications. Self employment is so important in an economy that is still struggling to stabilize itself in a world economy that doesn’t take into account the plight of many young men with the skills required to work fruitfully in any given economy.
It is important to point out that the entrepreneur needs to be prudent when appropriating the rewards of his investments, for instance some of the profits should be ploughed back into the business. This basically means that the entrepreneur needs to re-invest some of the rewards that come to the business in form of profits
The business needs to grow and capture many opportunities in its industry. Through proper planning and due diligence, the entrepreneur can device several ways through which he can plough back his interests in an attempt to multiply future rewards. Some of the ways of reinvesting among others are:
- Opening up new branches in other locations
- Implementing a new product design
- Hiring professionals to manage various aspects of the venture
- Investing in office automation processes
Opening up new branches in other locations
Depending on the location of the current set up, the entrepreneur can decide to open new outlets for his products in other regions where he has assessed sales will be high. This move also creates jobs for other people and in this way, the entrepreneur also thinks about the society his business serves.
Implementing new designs
This should come in when the entrepreneur is sure sees that his first project is doing well and there is room for more. With the resources generated from the first project, the entrepreneur can then start working on a new brand or improve the current brand. In this way he doesn’t sit back and let the business thrive on the success of the first project only.
Hiring of professionals
With growth of business, the operations also become rather complex in nature. A business that is constantly growing and re-investing its interests needs to ensure that the sensitive aspects of the venture such as finance and customer needs are well managed. The entrepreneur could therefore, think of employing the services of qualified professionals to help him run the business.
Here, he could hire accountants, IT specialists, a sales and marketing team et cetera.
Investing in Office Automation processes.
Addition of more capital is a sure way of expanding more so if the capital will lead to efficient ways of doing business. In the growing world of business, it has become as a necessity that a business arm itself with an ICT strategy that works. The entrepreneur can thus direct some of his expansion efforts in this area so as to keep up with the competitors.