At one point in time, I’m sure that everyone dreams of “being their own boss” and in our roller coaster economic times, the temptation may be more than just a passing fancy. The challenge in deciding whether or not you are ready to hang out your own shingle needs to be carefully planned and deliberated and frequently, that planning will be the difference between a business that survives and one that doesn’t make the cut.
Beyond an overall business plan, there are a number of considerations you should make in launching a start-up and preparing for possible challenges that you may encounter once the initial stages. You may be confronted with a non-viable product or service or you could hit some cashflow glitches that prevent you from meeting your demand. Even once you have established yourself, you will always meet with hurdles that you must manage and resolve.
Do some initial analysis to ensure that there is a market for your product or service in your area of operation. Check the market trends and statistical analysis and do some research through industry journals and online. Take the time to discern where there are market shortfalls and see if what you’re offering might fit a perfect niche. Carefully search out the competition and see if there is a sufficient market demand to ensure that you will get an ample share. Figure out how your offering is unique and why customers might choose you over other similar businesses.
One of the biggest risks of starting out is establishing good and safe relationships on both sides of the transactions. Finding the proper suppliers that can meet your demands in the right time frame and at the right price might take a couple of rounds of trial and error and be prepared for some potential financial risk in that regard. You may have to better established before some suppliers will extend credit and thus you may be paying upfront in some cases. Worst yet are unreliable customers or clients for whom you complete project work only to have to chase them relentlessly to pay their invoices. Some may even have to be written off as a loss.
Try to be efficient and effective with your administrative organization. Make the most out of electronic filing systems and back everything up or store online where it is accessible at all times. Try to always use your own resources and not work on client computers or servers where you can lose access to your intellectual property. Outsource any aspect of the operations where you do not possess the expertise such as accounting, tech services, etc. The time you will need to spend trying to learn things that you can’t bill for are not worth it in the long run.
Which brings us to a big one – financing. If you are going to need start-up funds make sure that your business plan clearly indicates what will be required and why and create concrete, realistic projections that will outline how you will be able to pay back any loans or pay dividends to investors.
Sadly, starting your own business does not mean that you don’t have a boss – in fact, you have many more than in a standard full-time job. You have your clients, your investors, your employees and your suppliers. You answer to them all but in the end, you’ll be doing what you love and if you plan carefully you can make it a success.