A budding entrepreneur recently asked me an interesting question. He wanted me to tell him the one single most important thing you need to have, when setting up a trading company. Surprisingly, I found myself unable to give a straight answer to that question. That is because I know the things you need to have, when setting up a trading company. However, I am unable to pick out one, and elevate it to the status of being ‘the most important thing’. To my mind, all these are things you need to have, and you can’t be able to set up a proper trading company in the absence of any of these things. So I ended up giving him an exposition on all the 5 things you need to have, when setting up a trading company. For the benefit of my readers, I repeat them here.
Firstly, when setting up a trading company, you need to have adequate capital. A poorly-funded trading company will have problems, and it may end up failing prematurely. Capital is one of the key factors of production in these sorts of ventures.
Secondly, when establishing a trading company, you need to find good premises to house the business. You need to figure out how much space you will need, for the trading company. Then you will need to buy, rent or lease such space, to get the business going.
Thirdly, when starting a trading company, you need to have good staff to help you run the business. Don’t ignore this: the success of your business could ultimately hinge on the quality of the human resource you have.
Fourthly, when starting a trading company, you need to have reliable suppliers. So you have to study, to understand how the supply chains work. Then you need to position yourself properly, knowing that the success of your trading company will also depend greatly on the reliability of your suppliers.
Fifthly, when setting up a trading company, you need to have a well thought out business plan. You need to have figured out how the trading company is to operate, how it is to beat the competition, how it is to make its profits… and so on.