While not everyone is cut out to start their own businesses, Pulse business reporter Emmanuel Quist offers eight key tips to those who think they are ready to take the leap to self-employment.
It is necessary to note that not everyone is cut out to start their own businesses. Many people are entrepreneurs. These are individuals who are gifted are growing and managing other businesses but are not necessarily people who will be successful at starting their own. But, if you think you are ready, then this list will help you get going.
1. Get ready for the extra responsibility
Starting your own business and sailing your own ship may not be as easy as you may think. Most people tend to think that because they get swamped at work with lots of responsibility and may even run all the obligations necessary in satisfying a customer, it may be time for them to start their own business.
That is not exactly true. Running your own company entails more responsibility than just satisfying customers. The same way being a parent and being a nanny are not the same. A parent is concerned about the survival of the child, his welfare, his future, and his aspirations. The nanny only follows chores needed to care for the child at a particular time. The same way a nanny is not the parent, you cannot equate being an employee to the business owner no matter how good an employee you are. You must be ready to deal with different egos, and keeping the business financially afloat. Not getting this right from the start, or getting a partner who will not be a proper leader from the start will make things impossible.
2. Concentrate on learning how to build systems
It is common for fresh starters to concentrate on delivering tasks rather than building systems. As an employer your task is to build systems and not to carryout the errands of an employee. It is important to differentiate properly. For many who start out alone, they will have to combine the two for sometime, but it is important to acknowledge the two roles and treat them separately. Systems ensure that the business runs whether you are around or not, and once you have the opportunity to build that system, make it a point to do so.
3. Plan your personal finances
One of the biggest hindrances to employees starting their own businesses is the fear of a disruption in revenue flow. People have lived the majority of their lives living from paycheck to paycheck. It will take a lot of bravery to actually make the leap, but it also requires a lot of financial planning. It is important to anticipate your needs on a monthly basis, and keep an emergency fund to cater for them.
4. Start Small
For anyone who has the dream of transitioning into your own business, starting early helps. Start early and grow steadily. This will require effective time management skills in order to properly manage your day job with your startup.
Careful attention must be paid to your employer’s conflict of interest policies and non- competes will be helpful in avoiding any legal issues or being fired before you are ready to stand on your own.
5. Time your transition
Timing is everything. There are consequences to leaving your job too early, and equal consequences to leaving too late. It is important to get the timing right. For some people a good marker is when the demands of their business makes it impossible to combine it with their jobs. For others, hitting an amount of revenue target, or the business’ ability to fully pay their salaries, cover operation cost, and make some profit to ensure growth.
6. Succeed or die trying
This is an attitude that will kick in naturally, once you have quit your job, and relying on your business for a livelihood. It is a natural feeling that, when utilized properly, becomes just the motivation you need to succeed.
This is the time to retain your customers and use them as a catalyst to get more. You also need to realize that your side business has now attained the status of a full-blown business and treat it as such.
7. Build a strong base for growth
One word that can never be over-emphasized here is partnership. At this stage, it is necessary to share the risks, responsibilities and potential success with someone else. It will be right to get a partner or partners at this point if you don't have any. Your partners must be people who have additional skills necessary to increase your revenue base, either through injection of capital, or the provision of additional services. The partner can be the additional hand you need to serve more customers, that you will not be under obligations to pay at the end of the month. Their fates are tied to the success of the business just as you are.