The Blog has latest news and updates of current affairs which will help you in your education
Is it wise to take a loan from the bank to start a business?
Some people don’t believe that if you cannot make money without money, you probably can make money with money. If you are starting a business and you need to borrow money to start, for most people chances are it means that you don’t know how to generate revenue.
In order to generate income and revenue in a business, you need to be able to sell. And, if you don’t have the ability to sell too close, to get customers, more money doesn’t help. I believe you should raise capital and this is just my belief.
But, I believe you should raise capital when you don’t need money, when you are already have something that’s working. Often, you’re getting trapped in the marketplace that you want their money in order for growth, in order to expand, you know to acquire more customers. Now, this is not the only way to make money, there are companies out there. We are in a tech world. They are raising money. They are putting investors’ money into the ventures and then eventually they want to sell that.
That’s a very particular strategy on its own and the only in certain sectors. So, don’t worry about if you have money or not right. Be worried about your skillset. If you’ve got no money, zero dollars instead of starting a business, what you focus on is working, on developing the high income skills first. It’s a skill that pays the bills. When he’s got some money coming in, then you can take that money and then start your business. If that’s what you want to do, if you don’t know how to generate money, more money doesn’t help.
More money only makes to get faster your failure rate. When you’ve got no money, it forces you to be resourceful. It forces you to think outside the box. It forces you to be creative. It’s not so bad, because at the end of day as an entrepreneur what we do is we think outside the box. We use the resources that we have; sometimes very limited to create some kind of results, to create some kind of products, to deliver some kind of value to the marketplace in exchange of money.
Stay tuned with Zeeable for more of such updates!!
Having traveled to the beautiful orderly end house in Essex conquers hopscotch, having a head flush down the toilet, they’re all classic childhood memories. But, nothing beats the recollection of the first fairy cake which for so many kids is the original point of entry into the glorious world of baking fairy cakes or cupcakes as are also known were first made in the kitchens of these vast stately homes, but would never have been possible without the use of a particularly unusual piece of kitchen kit.
Why they’re called cupcakes?
First, they’re baked in cups and the other is that the recipe often includes cups of things, so it will often be a cup of sugar, a cup of flour, a cup of butter.
So, how do the servants get their hands on crockery bling like that like anything cups quite a fashion so upstairs they’re drinking from delicate little tea bowls, then they start to get handled cups. The delicately bowls devolved down the household until eventually they reach the kitchen. The cook may well be drinking tea out of them and she looks around for something to bake a small cake and throws in the mixture into the oven.
First published cake in a cup recipes was written by the famous British cook Marie Arundel in 1806. Her Queen cake contains three cups each of flour, sugar, currants, butter and some very frothy eggs. This is the era where what we now know as the fairy cake is really invented and it’s called a fairy cake precisely because it’s so light.
In the medieval period, we’re going to mix in our egg whites and then we’re going to add in the dry ingredients folding them in. This made us end to end up with something that’s quite nice and light and airy and will rise very well because of all of the whiskey and then we’re going to fill them about two-thirds full because they will rise.
Cakes popularity really took off as afternoon tea became more fashionable. This teahouse bridge was specially designed for ladies to enjoy beautiful views and eat lots of small cakes. Georgian period is all about taste and gentility and refinement and civilization and showing ourselves to be one of the most civilized nations on earth. So, small cakes really are very useful both in terms of having something that’s the right size in proportion to the tea cup. But, also in having something that isn’t going to be unladylike in terms of what you’re eating.
Stay tuned with Zeeable for more of such updates!!
You may see sole traders refer to as sole proprietorships. It’s just two terms that means the same thing.
What distinguishes a sole trader from other forms of business ownership is how many people are allowed to own the organization. So, as the name suggests a sole trader is a business that has a maximum of just one owner.
A sole trader may only have one owner of the organization but they are of course free to recruit employees. If you wish so, you only have one person at the head of the organization owning the business, but you can hire a team of workers that will be in your employment to help you in the running of your organization.
Benefits of being sole traders
With only one owner of the business, one person gets to keep 100% of any profit made. There’s no dividing profits between different partners in the organization. There’s no having to pay dividends to a team of shareholders in the organization. Any profits made are kept entirely by the one owner of the organization.
They have 100% of the control of their organization as well. So, with only one owner, they get to decide the direction and the strategy of their business. There’s no compromises. There’s no time spent discussing different courses of action with other partners or shareholders. With one owner, that one person gets to make 100 percent of the decisions that effect that business and that can be very appealing to lots of entrepreneurs.
There’s not lots of complicated documentation. There’s not a lengthy registration process. What you have to submit in terms of tax returns or informations to Companies House is minimal or zero. So, sole traders really can get up and run very quickly without lengthy documentation to complete and submit to the government. But, on an ongoing basis, there’s very little requirement for them to report on their business activities to the government or to the Inland Revenue. What they do have to complete and submit is very simple and very quick to do which makes it another benefit for many people as kind of slightly more complex one and that’s associated with the kind of taxes that sole traders pay.
In the eyes of the law, a sole trader is essentially a self-employed individual. The law makes no distinction between the person owning the sole trader and the business that they are running. In the eyes of the law, they are one and the same entity and that means that the business doesn’t have to pay its own form of business or corporation tax. The person is seen as the business. So, just like an employee or any other individual that has a job rather than having to pay corporation tax that more formal organizations pay, sole traders pay a type of tax known as income tax.
A sole trader is allowed a certain level of profit before they have to pay any tax to the government and currently in the UK, the tax-free allowance that you are allowed to earn before paying any income tax is twelve and a half thousand pounds.
Downsides to being a sole trader
The owners of sole proprietorships have what is known as unlimited liability. That means that in the event of business closure, if the business is leaving behind any debts, the owner remains liable or responsible for any of the debt of their business. Their liability is not just restricted to whatever capital they have invested into the business. If you run as a sole trader, in the event of business closure, you become personally liable for any debts that the business may have. You might have to take those debts with you in your future life. So, once you’ve closed down your business and perhaps return to work or started another organization, you are still liable for any debts that your previous business ventures may have left behind.
With fewer people owning the business, there’s obviously fewer people that can invest capital. When that organization first starts, with only one person able to invest capital into the business, it might start on a longer scale than other types of business organizations are able to. It might mean that the business cannot set up on as large a scale as if another type of ownership was chosen and more investors or partners were able to put capital in to the organization. That might limit the size of the business in its formative years. It might also limit how quickly it can grow and expand and how big a market share it is able to amass during the first months and years of the business. So, for some people, if they’re starting businesses for financial rewards, sole traders might not allow them to raise as much capital as they need to start the kind of organization that might give them the financial security and rewards that they are looking for.
The final limitation is that as a sole trader although you can have employees, there is nobody alongside you owning the business. So, it might be very difficult to find anybody to cover you during periods of absences or illness or holidays. It may well be in the life of a sole trader that if you are taking time off your business is not earning money although sole traders are allowed employees, it’s not common to have employees as a sole trader. Most people start sole traders and run it just by themselves as the only worker inside the organisation. That means that when you take a two-week holiday, your business isn’t earning. There’s nobody left behind to carry on running the business.
A partnership is an organization that is owned by two or more individuals commonly up to 20 different partners.
Advantages of a partnership
Partnerships have multiple people running the organization. This means that more than one person can introduce capital when we start that business. That might mean that we can raise a bigger pot of money to start our organization with which might mean that we have more money to invest in the materials and the equipment that we need on the marketing or the market research that we would like to conduct. It might also allow us to start our organization at a slightly larger scale than if we were starting it by ourselves.
The fact that we have multiple owners also means that we now have multiple individuals that can all contribute ideas to the running of the organization. So, different partners might come up with different perspectives, different viewpoints that they can contribute towards the direction the business is moving in and it might be that some partners think of ideas that one individual might not have considered if they were running their business by themselves.
Having multiple partners running an organization provides the opportunity for them each to specialize in a different area of the organization. In a law firm for example, one of the owners might be a specialist in family law, whilst another is a specialist in personal injury law and a third partner is a specialist in corporate law and they can each bring their own areas of expertise or specialism to our business. Whereas, if we only have one owner, that one person has to be an expert in all of those areas themselves, to run the business as effectively.
Just like sole traders, partnerships pay a type of tax known as income tax and with income tax is quite useful for people starting smaller business organizations because for each of the partners. So, if the business is going to be operating on a smaller scale than larger organizations might and might not be achieving the profit certainly in the early years that a lot of business hopes to achieve, then paying corporation tax might be quite attractive for the owners.
The other benefit we could talk about with partnerships is that having multiple owners means that they can cover for each other. So, in periods of sickness or when owners want to take time off or have holidays the other owners are still there to oversee the running of the organisation. Whereas in sole traders, when the owner is away, often there is nobody that they can trust to run their venture in their absence. But, partnerships have some limitations and perhaps chiefly amongst those is that are by having multiple partners, the profits now have to be split or shared amongst multiple people. So, no one person gets to keep 100% of the profits of the organization.
Drawbacks of Partnerships
We have to split the decision-making or the control of the organization with other owners as well and this brings into play the potential for conflict in the running of our organization as different partners might have different ideas or different visions for the organization that leads to the creation of conflicts. When we have conflict in a business often it means that the business is not moving forward, that it’s standing still whilst the owners try to reach consensus on the direction that they would like to go in.
Each partner will have unlimited liability unless as in some very rare cases they can apply for limited liability status for some of their partners who’ve just contributed capital to the business but aren’t involved in its day-to-day running. But, most partners will have unlimited liability which means that they have the same legal identity to the business that they’re running. So, if the business gets sued, it’s actually the partners that get sued and if the business runs up debts and it’s declared bankrupt, it’s actually the owners that are going to be responsible for paying back the debts that the business has accumulated even if that requires them to use their own personal wealth to fund that debt repayment.
Limited companies are both private and public. Limited companies have limited liability; a liability is responsibility for the financial depths of the business. Basically, so owners of PLC and Ltd only risk losing the money that they have invested and not their own property and rights or trades and etc.
So, basically, as an example, if there was a hairdresser and she started her own business being a sole trader with maybe five thousand pounds and eventually she ends up being bankrupt at seventy-five thousand pounds. she has to pay back all the debts. She might have to sell her own personal possessions like her own house in order to cover this because seventy five thousand more you got into your sole trader basically. If it was a limited company, the hairdresser would only lose the 5,000 pounds of share capital that she actually had start with in the business and not this extra bankrupt debt.
The more shares, the more control that the individual has over the firm. Public limited companies and Private limited companies both have shares.
With Private Limited, you only sell these to let your family, your friends, it’s less than 2,000 shares that you can have, whereas with public limited companies you sell it on the stock exchange market. So, anyone even I could buy stock like part of a share.
Private Limited companies should always end with Ltd or Limited. If they’ve got a limited in their name, they are like a private company.
Advantages of a private limited company
They can’t sell the shares without the agreement of other shareholders and they’re usually small companies. Even prior public companies could be small and private companies could be big.
Private limited companies are usually small companies and they have to publish accounts and these disclose information but not everything. They don’t have to tell everyone everything about their business unlike public limited companies.
So, you won’t lose more money than you invest in the company. So, your home weren’t be taken away like lead by example I used about the hairdresser and how she has to sell her house possibly because of the 75,000 death shares or sort of the family and friends which raises money for the business. So, usually you sell shares in order to get more money for the business to buy no quick mint and stuff like that. If someone dies, it doesn’t take effect of running the business.
Disadvantages of public limited companies
They have to share their profits by paying dividends to the shareholders. With private limited companies, you’re only giving your profits to your family and friends. So, I don’t think it’s that much of an issue really and it’s usually less compared to the public. You can’t sell your shares on the stock exchange market which is bad because you can’t generate even more money or more capital because you can. Because you are a private limited company you can only do it with family and friends and like close people like owners and stuff and it is quite expensive to set up. So, your startup costs are pretty much high.
Public limited companies are PLC in their names. They can sell shares to the public. Their shares can be listed on the stock exchange market. They can freely buy and sell their shares. But, usually you shouldn’t make sure that they have a fifty thousand pounds of share capital. Share capital is the amount of shares that you can actually sell. So, a minimum of fifty thousand is needed.
Advantages of public limited companies
They can raise more capital by being a PLC than any other business because you’re selling your things, your shares on the stock exchange market. So, you can get so many shares from so many people. So, your income, your revenue can actually increase. That’s why they say that you can earn more capital by being a PLC than any other company whereas when you are a private limited company, then it’s only your family and friends who put in the capital.
Extra capital allows the business to expand. So, the more people that earn shares in your business, the more you can expand because there’s more profits that you can get because they’re buying your shares. Death or an illness won’t affect how the business is run like with the private one. So, if you’re a sole trader or a partnership with someone dies there’s only one of you and therefore the business is kind of hopeless without the other person.
Disadvantages of public limited companies
It’s a lot more expensive to set up because it’s a public limited company. So, usually they’re like larger companies.
They have to publish and make available full and detailed accounts. So, basically there you have to publish everything like their financial records. So, it is very competitive.
So, if I was Coca-cola and I was a public limited company for example, even Pepsi could see my financial details; where I’m spending, my money, all these things that should be kept private. But, seeing as I’m a public limited company, I have to inform everyone, so I have to publish these detailed accounts, they have to pay dividends to their shareholders too. So like with the Private Limited companies, you have to always pay you your shareholders dividends. So, dividends is like income for your shareholders.
Basically, someone can easily buy enough shares to take over control of the company. If someone buys like 75% of the shares that you currently hold and maybe the other 25% or like 200 other individuals that one person that has 75% , pretty much controls the whole market. They could buy the excess shares off from everyone else and basically that’s kind of their company now.
If you’re trying to control over a public limited company, but I could even take over a business and have complete control of the company, so it’s a risk if someone actually does take up too many shares.
Public sector organizations are the business organizations owned by the government for public purpose. These government undertakings are started either by the central government or state government or a local self-governing Authority. Examples of government undertakings include areas of mining, metallurgy, shipbuilding, aeronautics etc.
The public sector undertakings are controlled and managed by the public and the government. Public utilities are set up and managed by the government to provide essential products and services to the public. Public utilities do not intend to own profit.
Stay tuned for the next lesson where more types of organizations will be discussed.
LED is a fairly old technology which is advanced dramatically through recent years. It uses a LED backlighting technology which shines through a crystal display to give you your red, greens and blues. The pixel accuracy from one LED can be one to sixteen.
OLED– is a new technology which stands for organic light-emitting diode. This uses a LED backlighting which has a much higher pixel accuracy giving your one-to-one ratio which means better response times and color definition. With this technology, they are able to make the screens much thinner and even flexible.
The most significant differences between LED and a OLED is the color accuracy. Also, the contrast levels. OLED has the ability to shut off individual pixels, which means you get completely black sections of the screen.
OLEDs are considerably more expensive and only come in a limited range of sizes. LEDs have become much more affordable in recent years and is still improving.
This is a significant difference that I have seen. First hand, LED does not seem to handle motion as well as some of the top-end LEDs the colors tend to bleed out a little bit and it looks a little bit blurry. This may be something that will be fixed in the future.
How long is the lifecycle of an OLED panel?
It has been said that certain colors may fade and die out over time. This is yet to be field tested as the technology is so new. We will find out in the future.
LEDs currently still have an ace-in-the-hole with their 4k ultra-high definition. This means that these panels have the ability to show four times the amount of pixels.
Currently, there are no OLED TV on the market. High-end LEDs with local dimming have a better ability of reaching darker blacks. But, never quite as dark as the OLED. But, with their 4k resolution, they are definitely a good match for the O LED panels.
Both types of panel have their ups and their downs. LEDs being very affordable, available in large sizes with the 4k resolution and a longer lifespan, where as OLED has a better contrast range, redder colors, thinner panels but a potentially shorter lifespan at a high cost .
Stay tuned with Zeeable for more of such updates!!
Stakeholders are those people who are interested in and affected by your business decisions.
There are many types of stakeholders and it depends on each business.
- Local community
These are the people who are working or living around your company or around a factory.
For example, you own a factory and your factory works 24/7, causes a lot of pollution and suddenly you decide to double the production because your demand has increasedand obviously if you produce more, you’ll produce more waste and more pollution. That will affect the local community because they don’t want you to cause that pollution. They want you to be environmentally friendly. They want you to you keep things clean, not dump waste in the rivers.
So, they are your first stakeholders and you need to make sure you keep them happy. So, you need to make sure you cycle your environmental friendly, you don’t dump your waste.
This is because the customers do get affected by the decisions that you make. Your customers want high quality, low prices. So, they are obviously interested in what you decide to do, because they want to make sure that you are giving them the best quality products in the lowest price possible.
If suddenly you decide to increase your prices, that will affect them because they might perceive it as a higher quality product. However, they might not buy it now because it’s more expensive. So, the customers do get affected.
Since there’s so much competition, you need to make sure that your customers, your stakeholders, customers are happy.
3. The government
The government is definitely interested and affected by your business decisions because the you pay tax to the government and the higher your profits are the higher tax the government gets.
They are affected by decisions because they want job security, they don’t want to end up working in a company who is at the point of closing or shutting down and they want to make sure that if you’ve decided to grow, then obviously they are happy because they know that their job is secure.
They’re gonna be working in the company, they don’t need to look out for another job and they might even get a promotion because the company is growing and the company will earn more and maybe they’ll get more bonuses out of those processes.
5. The owner
The owner is the one who owns the company, he is not earning a salary, he’s earning what he sells and whatever, he earns is after paying you your salary, after paying the workers,after paying all the expenses that a business can have. That’s when he gets the ultimate on money; the final money.
Sometimes, he has roughly nothing because he has faced so much.
6. Money lenders
If the bank has given you a loan, the bank wants to know whether you’re capable of paying interest and repaying and paying back the loan. If you suddenly decide to shut down because you’re unable to run the business or you go bankrupt and your bank will seal arm your business and will get a hold of you.
The supplier on the other hand also get affected because they lent you the materials, if you suddenly decide to close down, then suppliers obviously now have one client less.
They know that they now have to find another client in order to serve a purpose or as well the supply. Sometimes, they give you credit. They allow you to pay for two months later for whatever material they supply to you.
If your company suddenly starts doing terribly and starts performing terribly, you’re not selling well, you don’t have enough money to even pay to the creditors, the suppliers will get affected because the supplier has lost all its material he has already given it to you.
Being a sole trader or a partner in a business is a complicated decision. Partnerships are very popular ways of starting a business.
A sole trader is generally someone who runs their own business. Unlike other forms of business, a sole trader is entirely responsible for any debt.
This means that your private possessions could be at risk if your business fails. This might seem like a scary thought but don’t let it put you off.
There are many advantages to running your business as a sole trader.
Louise lives with her partner Patrick. They have a three-year-old and another child in a second year at primary school. Patrick has a full-time job during the week. However, to supplement her family’s income, Louise works 20 hours each week at a call center for a credit card company, mainly weekday and Sunday evenings.
When she has time, Louise makes her own jewelry which she sells on her website. The credit card company pays Louise a monthly wage which has had income tax and national insurance contributions deducted from it. This means that she’s an employee of the credit card company. But, Louise is also a sole trader because she’s responsible for making all her own decisions for her jewelry making business.
She’s thinking of selling to customers in person. So, she’s contacted the local council to discuss getting a license to have a stall at the weekend market in town. She’s also spoken to an events promoter to find out how to get a stall at the major outdoor festivals and other open-air events next summer.
If her business starts expanding, she might need some help; someone to run her website perhaps or manage her paperwork while she’s busy selling rings and necklaces at the festivals. If she starts employing someone she becomes an employer.
But, it’s important to remember that being an employer doesn’t mean she stops being a sole trader. She can still be both so with or without an employee.
Louise is definitely in charge of her business. This means she’s self-employed amidst. Therefore she should tell HMRC she started in business, she’ll also in due course have to complete a tax return.
Partners are members of business partnerships. There are three types of partnership. Ordinary partnerships, limited partnerships and limited liability partnerships.
Concentrating on ordinary partnerships, this is the most common type of partnership for people starting up in business.
An ordinary partnership or just partnership for short is basically two or more people coming together to jointly run a business. Like sole traders, partners are personally responsible for any debts the business may have.
However, there are many advantages to running your business as a partnership. For example, having partners means your business may have a wider skills base and more possible sources of business finance.
Case Study: Jacob
He used to have a fairly well paid sales job. But, didn’t get on with the boss. So, before resigning, he started looking into setting up his own business.
What Jacob needed was certain specialist skills and knowledge and he felt that his two old school friends Alan and Mahendra fitted the bill. Jacob knew that Alan’s just back from his travels in Asia. He had been keen on art and design from an early age.
Jacob had also recently found out from an Avengers page on a social networking website that he build a website for his father’s business. So, one day Jacob sent his two friends an email proposing that they set up a marketing and design firm.
Alan thought the idea assigned a good on paper. So, they set up a meeting to discuss it. The meeting went well and the three agreed to set up as soon as possible.
They agreed to put some of their own savings into the business to help get it started. There were no set rules and running a partnership four months later and with the help of a solicitor, the boys finalized a written agreement on how they’d make decisions, share out the various responsibilities and divide the profits.
Partners are self-employed individuals and therefore separate for tax purposes. This means the partners must each give details of the share of the business profit on their individual tax return.
All businesses in the private sector are owned are operated by private individuals or companies and generally private sets of businesses are run with the objective of profits, to earn returns for the business owners.
In the public sector, these organizations are either owned by or run on behalf of the government or organisations whose funding comes from the government and public sector businesses whilst they can be run for profit, t earn a profit they don’t necessarily exist for that. They are mainly to provide goods and services to the public. This is because they’re using public funds.
What are the biggest challenges facing organizations from the public to the private sector?
The biggest difference is understanding up they are not the same. Every organization has a public responsibility because every organization has a constituency whether it’s the Motor Vehicles department, they have a constituency that requires a product or a service from them or whether you are an IBM that makes computers and software and things like that.
But, a private business is allowed to make a profit there. Therefore, to make a profit for the investors and people who had put their money in. Most public sector organizations are simply there to fulfill a social responsibility that people have decided. They will handle it where the business is owned and directed by a small group of people who are the owners, it’s really directed by the society and how they budget for that work.
Stay tuned for the next lesson about Soletradership and Partnerships.
Every business has a unique objective. So, every business is trying to achieve different things.
On what does that going to depend on?
1 Size of the business -The target has to be realistic for the business to achieve.
2 Age of a business- Businesses will simply set the aim of survivor in their first year or two. But, as an organization grows and becomes established, that aim of simply surviving becomes less appropriate. Over time it’s time to start setting more realistic objectives like growth or making a profit etc.
The level of competition and organization phases can have an act on an organization to profitability and what’s realistic for it to achieve. So, more competition tends to mean fewer opportunities for sales and profit growth.
So, an organization might wish to consider in a highly competitive market, increasing its market share, gaining sales from its competitors might be a good way. As a business, it faces relatively low levels of competition.
3 Not-for-profit organizations- They would tend to look at providing a service or achieving a particular target that’s not related to making profit. The owners of a business can have hugely different objectives.
Sole trader would be able to set their own target. But, as an organization grows, the ownership structure changes.
Thus, business objectives change. In the early stages of a business, its simply wanting to survive, to break-even, just to make enough money to cover its costs.
As a business becomes established and gains in confidence, it might look to increase the number of branches within the country. You might want to increase their market share, steal customers off their competitors, look at increasing customer satisfaction. As an organization continues to grow and might look at maximizing shareholder value, maximizing profit or look to international growth.
Some people might aim some social and ethical aims. Other businesses do that right from the start and you could make an argument for putting all of these in different places.
Business objectives change as a business grows and evolves and this might be a useful framework for looking at how that happens .
There was a skilled and hardworking carpenter named Ole Kirk Christiansen . Ole was a respected carpenter with his own company. But, times were hard. So, he didn’t have much money and had to dismiss his last worker.
It got worse shortly after Ole lost his wife. But, he was a special person, he wasn’t the type that gave up and with the responsibility of his four sons, he had to think of something.
He had gotten an idea and for him it never took long to put an idea into action. His little invention made his boys so happy that he thought maybe he should start making toys. He decided to give it a try. Luckily, he had saved up a lot of wood from the carpentry production. He could now use it to make toys.
Time passed by and even though Ole was a skilled carpenter and had a good eye for quality and detail, sales were very slow. Luckily one of his sons Godfrey started helping out his dad after school. Together they just barely managed to keep up the production.
Eventually, word began to spread that wooden toys of the finest quality were being made in the little workshop. One day, a man drove into town, a man who would change Ole’s future. He was a wholesaler from Fredericka. “I’ve heard that you’re making some very nice wooden toys.”
The wholesaler was very impressed with all the wooden toys and placed a big order before he left. Now there was a lot to do in the little workshop and Ole could rehire his former workers. They only used the highest quality wood which was hand-picked and very carefully prepared. They work day and night to get the order finished. So, the wholesaler could get the toys out in stores before Christmas.
In the middle of their work, Ole received a letter saying that the wholesaler had filed for bankruptcy and couldn’t buy the toys that he had ordered. There was no time to lose, only pack the car with all the toys and drove off . Ole was a very good toy maker, but was not a very good salesman. He didn’t like praising himself or talking about how carefully the toys had been made but he had to keep trying.
If he was going to sell anything, this is going to be a blast.In the end, he succeeded in selling all the toys. He didn’t receive as much money as he had hoped. But, the family managed and they had plenty of food for Christmas.
Time passed by, but the toys didn’t sell as quickly as they had expected. Ole thought perhaps the company needed a good name. It has to be a short word, Ole wanted to convey playing. Olay himself ended up finding a very suitable name but what he didn’t know was that in Latin the word leggo means I put together.
The name leggo was well received and the company slowly started to move forward. Eventhough Godfreid wasn’t comfortable spending money on a milling machine, he could see that it was useful and that the quality of the toys improved.
Ole believed in high quality and not cheating his customers.In the late 1930s Lego was making a profit. Even when the second world war broke out, they tried to make the best out of a difficult time. It seemed nothing could go wrong.
But, a stormy night in 1942 changed their luck. “There’s a fire!! The workshop is on fire.”
But, when the firemen arrived, they were unable to save the workshop. It burned to the ground and all the drawings and models were destroyed. Ole was beginning to lose hope. All that he had worked for was gone and he almost lost his company.
But, being responsible for his children and workers inspired him to rebuild LEGO, a new factory was constructed soon. The production of wooden toys started again. The little company fought its way back into the market.
Gradually, the Lego factory began to run smoothly and Ole started looking for new challenges. One day, he went to Copenhagen to look at a new machine that had just arrived in Denmark. It was a plastic moulding machine and Ole was very excited about it.
When the plastic molding machine finally arrived they started making little plastic teddy bears and rattles. But, he still had the plastic bricks that he had received at the fair. There was something about them that he couldn’t stop thinking about it. Even though no one else could see the potential in it Ole decided to redesign and put them into production. But, it was when Lego first launched the Great Ferguson tractor that the plastic toys became a success.
Unfortunately, the sales were dropping during the summer and the company had too many toys in stock. “This can’t be right of course our products can be sold the whole year, not only for Christmas. “
Godfreid decided that he would go out and sell the toys himself . Godfreid brought his wife Edith as company and moral support. “If you can’t get cash, then we lead by butter and eggs.”
It wasn’t that bad, Godfreid was a success in his trip around the country, which helped Lego to get out of its financial crisis. They reached home just in time for Ole’s birthday party.
The whole family was gathered to celebrate with him. “Hey, I got an idea, what about a picture with the three generations”
Everyone thought that was a good idea and they were placed on the sofa with all the presents and flowers around them. On a business trip to England, Gottfried met the head of a big shopping center on his way home. They discussed the toy industry and the conversation would be very important to the future of Lego.
“The toys need an idea and a system built around it. I want to put system into play. Children have only been offered ready-made solutions. They need something different that will strengthen their imagination and creativity.”
That same year, Lego started producing the first Lego system of play. Children could now build houses from the Lego bricks, the town plan gave play a realistic town setting and with this, children learned about traffic safety.
Godfreid decided to try selling it outside of Denmark. The system of clay was so popular that they managed to sell it to many countries. There was just one problem, the bricks can’t lift up. They keep falling apart. That made Godfreid wonder. He wanted to find a way to make the Lego bricks stick together. But, that was easier said than done. Godfreid noticed that the Lego bricks got a better clutch power with tubes inside.
Now, it was no longer just bricks, but a whole construction system with endless possibilities. This was groundbreaking for the Lego product. With a child’s imagination, Lego could be anything in the world. Over and over again the imagination is the limit.
Unfortunately Ole never got to see how successful the little brick actually became. Godfreid was left on his own and he had to go through another fire at Lego that destroyed most of the wood production.
Just like his father Godfreid knew that he had to try to get the best out of any situation and never give up. Godfrid took the hard times with his 1head held high. As sales grew, the company also got bigger. He had to think ahead and he decided not to resume the production of wooden toys and to only focus on the Lego system.
It turned out to be a great decision. Many new models were built and Lego got stronger in the toy industry. Eventhough it got busier at Lego, Godfried still had bigger plans now.
He wanted to build an airport so it would be easier to sell his toys to the whole world. It didn’t take long to put his idea into action.Only three years later, Billund airport was open. The many guests and business connections who visited the company always wanted to see the modeling department.
Gradually, it got so crowded that it was hard for the employees to keep up their work. “I think we better wait awhile.”
Godfrid could see that something had to be done, he needed a bigger place to display the lego models. “I don’t want to interrupt, so I’ll just put this package of our new Lego train on the table. Just put it there.”
The idea grew quickly from an exhibition room to an amusement park and then we could have a tower. So, you could look over the whole park from above the whole town, it will be a land made out of Lego.
Legoland looks interesting, but how many visitors are you actually counting on. There were six hundred thousand guests the very first year, the family was there to greet the guests. They’ve kept up this tradition ever since now.
Stay tuned with Zeeable for more of such updates!!
First, personal satisfaction -many business owners set up a business because they think they will be happier and feel more satisfied in their work environment than when working for an employer.
Under personal satisfaction, we have three categories.
1.The person is happy because the person is able to take risks.
2.They are implementing their own ideas
3.They are turning their hobby into a business
The next objective is challenge– some people are motivated by challenges and starting a business can be very challenging.
To be successful in a business, people need to be committed, hard-working, multitasked and motivated.
Next one is independence and control– some people want to be their own boss. These entrepreneurs are driven by the desire to be independent and to take control of their own future, the freedom to make all the decisions when running a business is very appealing. Some people often dislike being told what to do at work.