The top world billionaires are all business owner. This is not a coincidence. Business investment is the kind of investment that never disappoints. Many magazines are full of articles and inspirational articles on how people have made a lot of millions from a business. The common thing about all business is that the start is always small. You don’t have to have massive capital like required in other investments like the real estate. Business is the right investment for any individual. The government is advocating for fresh graduates to start their own business as compared to looking for formal employment. Why business is the best investment to make
Accumulation of goodwill, patent, and royalties
Goodwill is the price for the business having competitive advantages over other businesses. Goodwill is an asset. Accounting principle requires that the business goodwill is accounted for as an intangible asset. It, therefore, increase the amount of fixed assets employed in the business.
In normal circumstances, once, on investment is made, depreciation starts to accumulate on the investment. On business this the opposite, one a business starts operations, goodwill immediately starts to accumulate. On top of goodwill, one will earn good money as result of other business using the name of business or branding products in their products. Goodwill increases as the business establish itself. It never stops to grow.
Ready drawing and injections
A business gives the owner privilege and permission to make drawing whenever he feels like. Drawing is business money and asset used for personal benefits. The business will obviously have assets. This asset is brought in by the owner. The business gives you the freedom to use the assets whenever you feel like using them. Drawing on a business are not returned on any interest. This helps an individual fund other business other business in the time of economic difficulties without being affected by the economic status.
Drawing enables a businessman to operate a different business at the same time without having to take loans from the bank which are costly. On additional to this, if the business needs additional capital, the owner can do so by injecting more cash into the business. This can be done easily. Normally this helps the owner legally reduce the amount of tax he should pay to the government.
Builds experience and self-discipline
When a person starts a business, he is solely responsible for the operation of the business. Normally, one should set attainable goals for the business with profit and growth targets. The whole process of setting targets expose the owner to a wide range of skills. When goals are written, the challenging parts are having the written goals executed in a business setup.