Do You Want To Start Your Own Business?

There are many rewards from running your own business but there are also many pitfalls. Your best move if you’re thinking of starting your own business is to do some planning before you commit yourself to self-employment.

Generate Ideas
What business will you start? Generating business ideas is an integral part of business start-up, for example:

• To find one that is more interesting and therefore more motivating
• To adapt an idea to make it different to the competition

Marketing Plan
A marketing plan is essential, without it you don't have a business.

• Product, price, place and promotion are the key components of marketing.
• Do you have a market for your idea? Do you know who your customers will be and are there lots of them? Will you be able to get more in the future?
• Who are your competitors and why should people use your product or service rather than theirs?
• Financial backers will want evidence of this market but you need to convince yourself that self-employment is a better option than working for someone else. So, you will have to do market research.

Finance
Is your idea financially viable? Will you be able to maintain a healthy cash flow?

• Many good ideas don’t make money. Only by drawing up a plan will your find out if yours makes financial sense. Financial backers will want a financial plan but even if you don’t need an injection of cash, make sure you are not wasting your own time or money.
• Minimise your overheads. Only buy essential equipment; consider leasing instead of buying. Would it be possible to work from home or from a friend’s premises? Make sure you are able to cover your living costs as well as your business ones.
• And finally… If you are going into business with a friend, a partnership drawn up by a lawyer is vital. A “gentleman’s agreement” is a thing of the past.

The Pros

• Initial investment level is decided by yourself or your ability to attract investment
• You have the ability to explore new business concepts/formulae
• All post-tax profits are your own
• No restrictions on your business methods
• Control expansion to suit
• Ability to adapt quickly to changing economic circumstances
• Potential to sell, franchise or float on stock market once business has stabilised
• Great sense of achievement and ability to say ‘I told you so”

The Cons

• Comparatively little “hands-on” help and advice than other methods
• Steep learning curve
• May fall in love with the business and forget the point, e.g., to make profit
• Most business start-ups fail in their first year
• Ability for your friends to say, “I told you so”

Keywords To Remember

• Make things happen
• Take calculated risks
• Explore and discover
• Be creative and innovative
• Be confident
• Problem solve
• Plan
• Communicate
• Organise