Starting a business is an opportunity to create your future, provide security for your family, and contribute to your community.
But the prospect of starting your own business can be both thrilling and daunting. In Papua New Guinea, the challenge is even bigger. Limited access to finance and a not-so-vibrant startup ecosystem are but only reasons that make it even harder to start a business in PNG.
But things are changing fast with the introduction of innovative technology and business solutions.
So whether you want to be your own boss, turn a passion into a job, generate an income or create job opportunities for others, there are many things to consider if you are thinking about starting a business.
I have taken the time to put together this guide to help you. The bottom line is you don’t have to wait for a bank loan or government funding to start your business.
You can start now with whatever you have and wherever you are.
So let’s begin!!
1. Brainstorm business ideas
Time spent planning helps minimize resource wastage. Most successful entrepreneurs we see today are successful because they see a problem and solve it. Tune into the world around you and question everything. How could things be better? What do people complain a lot about every day at home, in the office, on the bus, in the supermarket, on the playing field, etc.? You don’t need to be super genius or super creative to come up with smart business ideas that work. Use your senses. If it doesn’t seem right, how can you do it better? If you do it better, will your solution be the solution to the people’s struggles? Don’t be afraid to be unconventional.
2. Choose an ‘on-demand’ niche market
The term niche is not very popular in PNG but the term is gaining traction with few Papua New Guineans venturing into online business. A niche is a focused, targetable part of the market. In a niche market, you are a specialist providing a very specific product or service to a specific group. There are many pros and cons of choosing a niche market. Here are four key advantages of niche markets;
- Increased profits – If your product is a general one, you will attract general customers, most of whom are not genuine and you end up wasting your time, effort money, and other resources with little sales. Focus on niche products and sell to customers that are genuine and profitable.
- Reduced marketing costs- Your genuine customers won’t create more headaches for you because they may have already done their due diligence and have chosen your product over that of your competitor. This helps you save time and resources and maximize profit.
- Greater trust and credibility – Overtime, your genuine customers may become loyal to you and you don’t need to do much marketing to convince them to buy from you.
- Reduced competition –Try selling something that everybody down the street sells and you end up creating competition for yourself. Find something no one has thought about and no one is selling and you will have less competition and more market share.
3. Create a simple business plan
Some successful entrepreneurs will tell you that you don’t need a business plan. If you can plan everything in your head and stick to it until you get it done, then good. Otherwise, it’s advisable to put your plans down on paper. Always remember the saying “Failing to plan is planning to fail”. We looked up key components of a business plan from Entrepreneur and Forbes magazines. Details from the two magazines are grouped into three categories.
- Executive Summary – Snapshot of your business
- Analysis – Industry analysis, assessment of your competitive advantage
- Plan – Operational plan, marketing plan, and Financial plan
Note: Keep an eye out for our post on “Guide to Writing a Professional Business Plan”
4. Create a highly demanded product or service
Just by creating your business plan, you will have a broader understanding on how your business fits into the existing market and the share of market your business can capture. This insight is very important for the success of your business. Many businesses in PNG fail because people rush into business thinking if they build a business, customers will flood in. Rarely does this happen. Look around a find product or service that is highly demanded but is not offered in the area you live.
5. Pick a unique business name
This shouldn’t be hard. Find a name that rhymes with your products or services for easy branding. Most internet businesses like to use fancy, weird names like Yahoo, Google, etc. If you run a T-shirt printing business at home, why not use JohnGrey Screen Printing or Riverside Media if you run a home base media? If you want to be a bit fancier, you can go online and use ‘Business Name Generators’. There are lots of cool websites that can allow you to generate your business name online. Type in the business generator on your browser and voila.
6. Understand legal business structures in PNG
To be on the safe side, we wish to briefly introduce to you the legal business structures in PNG. The four legal structures you need to know are briefly outlined below.
- Sole trader – Under this structure, you may own and manage your business activities by yourself.
- Company- Being in business means that you will often see organizations whose names end with the word ‘Limited’. A company may be managed by a board of directors, appointed by the shareholders.
- Partnership – Partners commit capital assets, time, or both, to the partnership business and in return share the profit depending on the agreed revenue-sharing ratio.
- Trusts – The basic principle of a trust is that the settlors may vest some or all their property into the trust for the benefit of the beneficiaries. Trustees manage the trust and risks are limited to the trustees.
7. Register your business name at IPA
Now that you are ready, the next step is to formally register your business at the Investment Promotion Authority (IPA). Visit their office in Konedobu in Port Moresby or visit the IPA website at www.ipa.gov.pg you can directly download the forms following the link below;
Download the Business Name Registration Form
Download Company Name Registration
Fill out the forms and lodge them at the IPA office. You also have the option to apply online.
8. Get your Tax Identification Number (TIN) from the Internal Revenue Commission (IRC)
After registering your business at IPA and getting your certificate of incorporation, what you need next is your TIN from IRC. Go down to Revenue House in down town Port Moresby and pick up the TIN Application form. Form TIN 1 is for Company and Form TIN 2 is for Business. Fill out the form and bring it up to Level 2 Revenue House again and they will process and give you your TIN and your certificate of compliance (COC).
8. Open a business account
Now you have your IPA certificate and your COC including your TIN. Get that and go to any local bank and open your business account. To save time, visit the bank of your interest and ask for all the requirements for opening a business account. Ask them to give you a checklist as most banks normally do. Work according to the checklist and provide all the requirements.
9. Create a website and social media page
A website and a social media page may not have been a necessary part of business a few decades ago but today it is. The number of internet users in PNG is exploding so why not leverage that? Let me give you a classic example. Creating entrepreneurlink blog in 1080 in PNG would have been a total waste of time and effort. But I created the blog 10 days ago and the page views exploded overnight with 1000+ page views on the first day. Amazing isn’t it? The more eyes you have landing on your website of Facebook or Twitter pages, you have a greater chance of being known and your products or services sold.
10. Create marketing materials
No one will be serious with you unless you are serious with yourself. Create your own or pay someone to do your professional ID and business cards. If you can, use Microsoft Publisher to create simple marketing brochures.
11. Create a free email account
You are in business and your professional contacts may wish to stay in touch with you at a professional level and that means you need to have a business email. We suggest you create a free Gmail address. You can have Yahoo or even Hotmail. Include your email address and phone number in your business card and marketing brochures.
12. Launch your business
This is not necessary but if you wish to pull some media stunt and go with a big bang than plan properly and do a formal launching of your business. Invite some key people. If you can get your local Member of Parliament to be present that would be a great bonus. Try as much as possible to get maximum media coverage for your launching and if you can, do give away some freebies. Freebies go a long way to build your brand and customer loyalty.
13. Sell! Sell! Sell!
Finally, if you can’t sell, then you shouldn’t be in business. Business is all about selling. Great businesses are built because their owners are master sellers of their ideas or products. Get out and network. Promote your business. You are the main evangelist of your business. So spread the good gospel about your business.
