Have you been considering quitting your day job in favor of starting a business? Have you just lost your job and are currently exploring alternative ways to earn a living? Have you always dreamed of owning your own business one day?
Before you take the leap of faith into self-employment, consider these 5 steps:
- Be clear about your goals/passions – It is not enough to decide to become a business owner. There are several questions and things to consider before moving forward to become a business owner. You will need to think about what kind of business you want to run. You will need to determine if you want to grow from scratch, buy an existing business, or buy an available franchise. But even before you decide that, you need to think about how the business will fit in with the rest of your life. Running a business can be a huge commitment of time and money. So ask yourself what you like to do or what will bring you joy. You’ll spend much of your day at your business, so it’s a good idea for the business to provide you with work that you really enjoy doing. Ask yourself, what are you most passionate about? What would you love to do? What is your dream job/business?
- Do your research/homework – Do not make hasty or impulsive decisions and do not leave your day job until you are absolutely sure of what you want to do and have a plan to do it. Take the time to do some good research by researching the industry, the market, your potential target customers, your competitors. Do proper business research, including a SWOT (strengths, weaknesses, opportunities, threats) analysis. Get a good handle on projected revenue and realistic operating costs, as well as an understanding of how long it will take to break even and generate more revenue than expenses. Identify your personal strengths and skills and determine if there are skill gaps. Determine how you will close any skill gaps or lack of experience. What gaps can be closed through skills training? What gaps can be closed by hiring the right people? What gaps can be closed through coaching or mentoring? Determine what options and opportunities are available to you at this time.
- Learn from the mistakes of others – There is no shortage of people who have started or run a business. Talk to as many people as you can who have gone before you. Learn what you can about what works, what doesn’t, and the mistakes others have made. Don’t waste valuable time and money. Be open to hearing the perspectives of others about what they would have done differently. Hindsight is always 20/20.
- business plan ahead – Do the work and develop a business plan. While it may be a lot of work, it will be time well spent and most financial institutions will require one if you are looking for financing. The business planning process is not just to show the bank that your business will be successful, it is also a road map that you must follow to ensure success. Managing your business finances can be like managing your weekly, monthly, or yearly personal budget; Therefore, if you haven’t developed good budgeting and financial management skills, it can be particularly challenging and doubly important to have a solid business plan.
- hire a mentor – Starting and running a business can be challenging or even lonely at times. In addition to day-to-day business operations, you may be feeling mentally or emotionally overwhelmed by owning a business. Having a safe place to go for advice, guidance and accountability or simply as a sounding board may be just what you need to help make the transition to entrepreneurship easier and smoother. Good training and mentoring can really help speed up your transition.
While there are many advantages to being an entrepreneur, it is important that you also consider the disadvantages of self-employment. Become a business owner armed with as much information, skills, and tools as you can to ensure a successful transition from employee to entrepreneur.