Do you start a new business … or not?
Things to consider if you want to start up a business of your very own. First, get out a plain piece of paper and a pencil or a pen. On the paper, draw a vertical line down approximately the center of the paper … it doesn’t have to be perfect. Next, at the top of the paper, write “Pros” on one side of the vertical line you just drew and “Cons” on the other.
Now … under Pros, list all of the good reasons to start up a business in your chosen field or niche. Things like, you’re great at what you do, you’ve got customers already interested in your product or service, you have experience at leadership and are ready to be in charge, and you would love a challenge.
Under Cons, list all the reasons starting up a business would be a bad idea. Things like you need a consistent and good income to pay your bills, you cannot afford your own medical coverage without your regular job. Just so you know, the things like you want to work less hours, you don’t like your present job, you feel your salary is way too low for what you do … or … you dislike your boss are not “cons”; they are reasons you are not happy with your present circumstances.
Jumping into a business … be it a home based business or a franchise, can be an exciting and frightening experience, so make sure you are not confusing a job you would prefer to do rather than a business you want to start up. Starting a business for the RIGHT reasons is the smartest decision you can make.
How to determine if you have skills enough to start your own business
Be honest with yourself and evaluate:
- Your Mindset: If you’re not willing to work long hours (if necessary) or literally get your hands dirty (if your chosen business idea requires this) then you will need to re-think your position. Entrepreneurs have to be able to wear all sorts of “hats” (be responsible for) when starting up a new business. Knowing your strengths and weaknesses at the start will help you best in the long run. As an entrepreneur you need to be prepared to work as long and hard as it takes to get your new business into being profitable.
- Your Financial: If you need a steady income to pay your bills then you may need to depend on your investments or your savings. Entrepreneurs cannot depend on an income from a new business for over a year … maybe more. Do you have enough start up capital to start your own business? (Be careful to not UNDER estimate the start up capital you will need.) If not, you might consider starting your business while you are still working. That works wonders for many new start ups.
- Your Business Idea(s): Be sure to discuss your ideas for a business with family members if a spouse is involved, as this will impact them too. Writing a business plan will help you to do this … and, be prepared to listen and consider your family’s fears and/or suggestions. Seeking a trusted accountant’s input can be of help too. Just be sure to NOT be overly optimistic or you could be setting yourself and your family up for disappointment.
- Your Skills: Do you have the skills to plan, market, budget, buy and sell? If you lack any of the necessary skills to start your business idea, can you afford to hire the expertise? If you do not like being around children then starting up a daycare business is not a good idea.
- Your Available Support: Can your friends and family support you emotionally? There will be ups and downs that you will experience in starting up your new business. As long as your friends and family realize, understand and support fact that you may have to pull long hours, you may suffer mood swings caused by issues you have to handle, you might fail in your new business … or … that free spending may be halted for a few years … then you will be well supported in your decision.
Do NOT be in a hurry to start your new business. Be sure you have a sound business plan in place, know your financial strength … and if necessary, take the appropriate time to improve your skills before taking the giant leap. Here are some FREE business plan samples to get you started.
Checklist for starting your new business
- Business plan: As noted above, you NEED a sound business plan. Do the proper amount of research into your selected idea for your new business. Information and statistics you collect need to support it. Be sure to include how you will conduct your business. Example: Will you be a sole proprietor or in a partnership? And, where you will conduct your business from: Example: home based or rental business property.
- Registering a business: Be sure to register and license your business accordingly with your municipal, provincial or state and federal governments.
- Taxes: Make sure you are fully aware of how to collect all taxes necessary whether you are in a state or province. Each area will be different.
- Staffing: Will you be hiring employees? If yes, then make sure you know and understand your obligations and responsibilities when hiring employees. Know if you will be obligated to provide compensation coverage and/or health insurance.
- Name your business: Choose an easy to remember name, one that is unique (you cannot register a existing name), and maybe even describe your product(s) or service(s). Example: Wilmington Attorney at Law
- Financing in place: Know your finances and NEVER be overly optimistic.
- Support: Will you be doing your own bookkeeping and accounting or will you need to hire one or more of these services? Who will you hire to do cover which responsibility?
- Legal shield: Will you want legal representation or can you afford your own law firm? Know which choice and who you want to protect you and your new business before they are needed.
Whether starting a business in Canada or starting your business in the United States make sure you are fully armed with the necessary information. Making a well informed decision about your chosen business idea is the ONLY way to start you new business, be it a turnkey, storefront or home based business.
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