Starting a small business is bold and requires thoughtful planning and passion. Here are five tips to consider.
What Do and Don’t You Want to Do?
Often a business is unsuccessful and its owner ineffective because they didn’t set core goals. Like Alice in Wonderland, they squander time, talent and resources, meandering about instead of staying focused. Understand what you like, what you are good at and, conversely, what you don’t. You can become good at some things, but kidding yourself into thinking that you’ll regularly do things you hate is about as effective as arguing water isn’t wet.
Is This a Hobby or a Business?
All too often, people bypass this important question and leap in head first. Embarking into business when a hobby suits your circumstances is silly. But fear shouldn’t hold you back! Write a good, old-fashioned pro and con list.
A hobby can be flexible and rewarding. A successful business, on the other hand, can be a labor of love and quite financially rewarding, but it requires much greater personal commitment in terms of time, capital and energy. And, of course, you need to get comfortable with a new friend – risk! Seek to know and to challenge yourself and you will make a good decision.
Plan Your Way to Success!
You should establish a good budget and business plan. Ask trusted colleagues in your network for objective guidance and mentorship. Talk to tax, insurance and other professionals. Talk to your customers! A choice often faced is whether to keep a day job or quit. There are pros and cons, but I encourage you to consider a plan should your initial income, if any, be quite modest. When your business takes off, you may require capital for materials, equipment, etc. Think about both situations. Be smart and brave!
As an FYI, access to a traditional bank loan is often dependent upon the personal finances of a guarantor – you. You may prefer not to risk or to pledge personal assets, and you sure want to try to avoid funding with high interest credit cards. Keeping primary employment (at first) may be sensible – or not! Run the numbers objectively.
A Non-Compete?
Individuals often want to open a business doing, essentially, their day job on their own terms. Ensure no enforceable non-compete agreement exists with your employer.
Challenges Lead to Wisdom!
You will have challenges, but almost everything is manageable when proactively tackled.
