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November 5, 2013

One+1 explained!

Tue Nov 05, 2013

Editor: “One one does full basket.”

The above is an old saying of great philosophical meaning. In basic arithmetic, we were taught that one + one=2. I remember in primary school, we made it a prank to ask fellow classmates, “One and one?” The correct answer was interchanged with ’11’ or ‘2’ based on their responses only to prove them wrong.{{more}}

The truth is ‘one+1’ can mean many things. You can have control of whatever response you want. In the divine maths, ‘1+1’ equals 1 (marriage: the two shall become 1). If this were a sermon, I would have expounded on this maths and explained that the individual is complete by himself/herself, which highlights his/her personal identity. Nevertheless, when joined in marriage,the same individuals become one. It sounds like a contradiction, yet it is an important quality in marriage, so that individual identities are still maintained, even in marriage. So, there is no “better half” or “other half.” It is one and one equals one.

But this article is not a sermon, so I will return to its entrepreneurial meaning. One+1 can mean the $50,000.00 you need for your start-up business. It can mean the ideal team you want to build.

One+1 is the mathematical equation for the old saying “One one does full basket.” Entrepreneurs and generally successful people must learn to understand and appreciate this concept. Sometimes, this may seem to be taking long, as we may have it all planned out and seeing the big long-term vision.

It is for this reason YBSVG started a television series called “One+1”. One+1 is aired on IKTV and features young as well as seasoned Vincentian entrepreneurs. The ideal message of this show is to explain that success is a process. For example, the Trotman’s establishment that we see is 67 years old. It didn’t happen overnight. The same goes for Singer, Greaves and all the other local entrepreneurs with whom we are familiar.

This does not mean there are not the Facebooks and overnight entrepreneurs who made it on the scene successfully. Even so, at the end of the day, it was still a process and a level of patience had to be exercised. In true entrepreneurial spirit, you are going to be very optimistic and overzealous, but remember “one one does full basket.”

This brings me to the point of start-up capital. Sometimes, because we have a big vision, we want to invest the large amounts of assets and cash that will accomplish the end vision. Maybe you should consider starting with the mere minimum needed to start this business. This is known as the point of capitalization. It is at that point you will want to start. That doesn’t mean if you have access to the money to start bigger you shouldn’t. The truth, though, is that most of us need a business loan to start our businesses. So, rather than borrowing $30,000.00, maybe you can borrow $20,000 and you work without a salary for two (2) months or even use a homemade machine rather than a commercial one. Or maybe you can fill the first order on the deposit received or a loan and use the profit from the first order to fill the next two orders, until you have enough reserves to buy in bulk and have stocks in storage to fill future orders. In economics, it is referred to as the “shoe leather cost.” As such, the shoe leather cost will be higher in the short run/initial start-up phase.

Of course, to start at a lower point, the shoe leather cost is higher. This may mean that you have to make two small shipments which means two payments, for shipment and customs and so on, which works out to be more expensive in the end. However, it means having manageable stocks, lower risk and quicker turnover of stocks, as well as building a reputation with a bank, which most businesses need at the start-up stage.

So, as you plan your next entrepreneurial move, remember that Granny said “One One does full basket.”

Kenrick D. Quashie
Kenrick D. Quashie is the Founder and Managing Director of Youth Business SVG Inc.