Evaluating the Economic Impact of your Venture
“The only limit to your impact is your imagination and commitment.” – Tony Robbins
Ever wonder what the impact your business has on the economy?
Whether you own a small start-up or a large corporation, the success of your business venture positively correlates to positive economic effects. Intuitively, business ventures create jobs, promote competition, facilitate innovation, and increase productivity.
Take the example of Apple Inc., the company began as an imagined reality for two passionate and visionary influencers – Steve Jobs and Steve Wozniak. At the time of conceptualization for their first product, the Apple-1, the founders could only have imagined the significant impact their company would have on the decades of users to follow. Today, Apple Inc. has provided thousands of jobs across the United States and Internationally, innovated a technologically advanced population, and changed the way people consume and deliver goods. A great example of use for Apple Inc.’s platforms is Uber Inc., a rideshare application delivered through mobile phones and internet connection.
While Apple Inc. has clearly impacted the economy through its billion-dollar-brand and job creation; the question now is – what is the next big idea? This question serves as a motivational factor for manufacturing entrepreneurs’ imagination into reality. What further incentivizes people to start a business can be found on Entrepreneur’s 7 Ways Entrepreneurs Drive Economic Development. In all cases, the possibility for economic impact by start-ups remains an exponential way to contribute to economic growth.
The binary effect a business venture has is its employment opportunities. Though we have automated jobs through technological innovation, our society as a whole requires skilled laborers to perform jobs and ensure productivity. These laborers through working for a venture, earn an income which can then be injected back into the local economy through spending on consumable goods. The ability to spend further incentivizes both existing or new businesses to create new goods to fill the market demand and economic needs. Disposable income further acts as a stimulus for businesses to create complimentary products, which describes the interconnected world we live in.
New enterprises excite the minds of innovation and enable the need for competition in the market. To best measure the economic impact your venture has, you should consider the following:
- Determine salaries and wages provided to employees, particularly in comparison to the revenue streams of the company
- How many employees currently work for you firm? Are they part-time or full-time?
- Is your product innovating the market? Is there potential for complimentary products or future innovation?
- What is the lifespan of the good?
If you aren’t satisfied with the economic impact analysis of your venture, it might be time to innovate or implement new business products. Quite possibly, it may be time to raise the capital to scale. Whatever your short-term and long-term goals are, be sure to consider the impact you have and how to improve it.