At one time or another, most people have dreamed about owning their own business. What could be better than choosing your own hours and taking vacation days whenever you want, right? No more answering to a boss that has no compassion or understanding about the energy you put into your job. Being your own boss would ensure the much-needed acknowledgment of a job well done. However, it is important to be realistic about the responsibilities that come with owning your own business. You cannot just throw up a website, purchase business cards and start handing out promotional flyers. A business plan is a must; financing, essential; and legal structure is key.
Transitioning from being an employee to an entrepreneur is difficult – survival rates for new businesses are small. The Small Business Administration (PDF) reports that 30% of small businesses that start will close their doors within two years and only 25% will survive for ten years. In light of this, how do you make sure you’re one of the few successful entrepreneurs? Here’s a few tips for survival.
Knowledge is Power
Many great ideas are lurking, but before you take the plunge, research all aspects of the responsibilities that come with owning a business. Knowing your competition is essential, but you need to be aware of the costs your new business will incur before you sign a lease for your new venture.
Know the legal responsibilities that come with being an entrepreneur. Are you going to be a corporation, nonprofit or sole proprietorship? If you cannot start your business on your own, make sure you have potential employees that are trustworthy and tenacious. Taxes will be your responsibility, and most likely you will not be able to afford a legal department to handle this at the start. Therefore, know what the law requires. You do not want to be dealing with legal woes before you are established.
Cash is king and you’ve got to have access to it if you want to grow, but cash isn’t the only thing you need. You need access to a whole host of other resources, such as the Small Business Administration, credit options with your local bank, the Chamber of Commerce in your community, a reliable online printer, among other items. You won’t succeed without knowing who to turn to in a crisis, and you will experience a crisis more than you would care to imagine running your own business.
There are many organizations committed to helping small businesses. One of my favorite is Score.org, which provides free business coaching from retired professionals. You can’t ask for a better resource for help from experienced people – and remember: it’s free!
Although giving your resignation the minute you feel a great idea burning inside your brain sounds fantastic, it’s important to look at the amount of time it’s going to take you before you start making a profit. Owning a business is very time consuming, especially at the beginning, and if you are not in a place where you can devote most of your time to your new business, it’s sure to fail. The days of working eight to five are over for a while so be prepared to put in long hours as needed.
Ideally, you can ease into the role of entrepreneur. A huge mistake most people make is to jump right in. If you’ve never owned your own business before, it’s very, very different. You are your own motivator and schedule keeper. If you can’t keep yourself moving towards a goal and can’t prioritize tasks, you’re in for a world of frustration.
It takes time to build up a business and growing pains are a natural part of that process. No matter how great the idea, it takes a series of processes, resources and people to turn your idea into a viable business. All of those things take time to coalesce and organize, so give yourself enough time and don’t rush.
If you are at a fairly low-stress point in your life, starting your own business can give you a mental boost like none other. Taking pride in your job is important, and there is nothing worse than dreading every morning that the alarm clock goes off. Making the move to owning your own business can make you feel empowered, and having grasped all the tools needed to make the step from employee to owner ensures that you will do what it takes to be successful.
A common problem is burnout. At some point, the business stalls or grows and you end up getting frustrated with the business. That’s okay and it’s perfectly normal. Taking pride in what you hope to accomplish is a great way to step back from the temporary feeling of burnout and re-focus your efforts.
The Future is Bright
Mental preparation is essential to good health and good choices. If you have taken the proper steps of business planning, funding options and legal guides and you still feel the enthusiasm that you had at the beginning, you are most likely ready to start your venture, to begin it now. If achievable, keep your day job until you have as much set in place as possible. Even though the road ahead may be uncertain at times, your thorough research will keep you from the added stress of surprises that are sure to hit you down the road.
Don’t forget to pick up the phone and call your list of local resources. The SBA and Score are just two places to start. Your local Chamber of Commerce may even have folks who can help you through a rough patch.
Lastly, enjoy the experience! It may not work out, but you don’t have to hang your head. Part of the process of becoming an entrepreur requires failure – sometimes small failures and often big ones. So pick yourself up and keep going. The future with you as an entrepreneur is bright – so don’t give up on it.