DECIDING TO START A BUSINESS: DO YOU HAVE WHAT IT TAKES?
Setting up your own business can be very rewarding, but there are pressures involved. It is not enough just to have a good, viable idea: you also need to have the right skills and temperament to make the opportunity succeed.
Starting your own business is also a risky thing to do, so you need to be aware of what problems to look out for as early as possible. This will help you to decide if you are willing and able to take those risks, and will also help you to apply strategies that will reduce them.
Before you go any further, it is important to find out as much as you can about the sort of person you are. Be honest and objective, and discuss the project with friends, colleagues and relatives. Think about how you have dealt with past challenges, as an indication of your response to difficult new situations.
Do You Have The Right Personality To Start a Business?
While the technical aspect of your business will require specific qualifications, skills, or experience, there are broader demands that are as important. These could include the ability to negotiate with suppliers, mediate between staff, be sociable with customers, be convincing with prospects, think clearly under pressure, take criticism, portray confidence, and use your time effectively.
There is no single type of self-employed person, but experience has shown that there are some characteristics which successful self-employed people often have in common. They tend to be logical, perceptive, organized, and responsible. They are usually extroverted and confident, and able to communicate and get their point across.
They are often sociable, with the ability to lead. Self-employed people are generally single-minded, but able to take advice. They are flexible and adaptable, quick to take opportunities, and ready to take risks.
They tend to be tough-skinned, and are able to handle failure. They are usually creative and imaginative, always coming up with new ideas for the business, and also hardworking, committed, and determined.
Finally, they are often individualists, who are not afraid to stand out from the crowd.
Assess Your Abilities And Resources
You need to ask yourself several questions. Do you have the financial resources, and can you afford to risk them? For example, you might take a secured loan based on the value of your home: what are your plans if the business fails and you are forced to sell your house?
Do you have sufficient experience and technical skills to perform the core functions of your new business?
Are you familiar enough with the market to be able to assess its needs and adapt to its changes? Do you have the tenacity and discipline to see through hard times when cash will be short and demands will be heavy (from customers, bankers, staff, and, crucially, your family)?
What Are Your Motives?
Why do you want to start your own business? There are many good reasons, but there is often the danger of having unrealistic expectations. Here are some reasons that people often give, and some notes of caution:
Independence
Yes, it can be a pain working for someone else, but still, need to be disciplined and able to get on with others when you work for yourself.
Greater job satisfaction
Self-employment allows you to do the job in your own way, and it is very satisfying when your way is shown to work. You do, of course, also have to take responsibility your way when it doesn’t work, as is bound to happen at some point.
Achievement and Success
There can be some cachet attached to the idea of running your business, but make sure you are not trying to prove that you’re something you’re not. If the venture failed, would you be able to deal with it?
More money
While the thought of being better off financially is naturally attractive, doing it for the money is not usually a good enough motive in itself, and greater wealth is by no means guaranteed. In particular, beware of starting a business when you have no other choice – you’ll be putting yourself under even more pressure.
If you go down this route, though, try to be pragmatic about what you can achieve as well as positive.
Be Prepared For The Pressures
The pressures of being self-employed are inescapable. You may have to work long hours, and there will be times when things get on top of you. You may well get into debt in order to finance the enterprise. You will need to maintain your faith in your business, often in the face of other people’s doubt.
There will be times when you feel lonely and isolated. If you employ people, you will need to be positive and show leadership all the time.
There will be times when you need to be tough and prepared to discipline difficult employees or make difficult demands of your suppliers. You need to be polite and helpful, even when an awkward customer is giving you a hard time.
Many of those who successfully start their own business have the backing of their family. You will be under pressure, working long hours. Your family must be prepared for the impact this can have on family life. Also, you must be sure that your family can accommodate the risks that self-employment can bring, especially in terms of lower income in the initial stages, and maybe even the implications of the business failing. Take time to talk to all members of your family who might be affected by your choice to be your own boss.
Common Mistakes
Assuming That Being Your Own Boss Is Easy
Everyone at some point has come across a boss who makes his or her life difficult, but don’t assume that working for yourself will be all plain sailing. There are many benefits, to be sure, but you have to get used to the idea that the buck stops with you. Make sure you’re ready to take on that responsibility.
Doing It For The Wrong Reasons
Don’t do it for the money alone. Weigh the pros and cons of your idea and the impact that starting a new business will have on all areas of your life. It will take a lot of effort, but YOU CAN DO IT.
