So you want to Be Your Own Boss?
So you want to be your own boss? Maybe it's because you simply don't enjoy your day job. Or maybe you have a great business idea. Some people even become their own boss by turning a hobby into a business. Whatever the reason for wanting to be your own boss, remember that it is never as straight forward as it seems!
To start your own business, you will need to do a lot of planning and preparation. In this article, I offer some basic guidance and support to help you to be your own boss.
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Plan, Prepare and Save!
Many people who want to be their own boss rush into it, but run out of money after 3-6 months and have to return to the day job that they hated. That is because they didn't carefully plan and prepare - both financially and emotionally. Most businesses take at least 12 months before they start to see a return. Shops and stock based businesses may take up to 3 years before the Managing Director can get paid.
The financial preparations that you need to make are simple - save enough money to live on for at least 6 months to a year. Also, prepare yourself to work very hard. If you want to be your own boss, it is not an easy ride. You need to expect to work very hard and long hours to make it work.
You may want to keep a part time job on the side for a year or so before your business takes off. Some people even develop their business and start setup while they are still working in a full time career. Sounds mad, but actually it's very sensible. However, be careful about publicising it and putting your career in jeopardy before you are absolutely sure that your business will work!
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Write a Business Plan and do the Costing
Ensure that you have a business plan that outlines your main costings and plans such as marketing and key contacts. A large and extensive business plan can be a little overwhelming and may be something that you would never look at. If this is the case, summarise the key aims and costings of your business onto one page of A4.
Your costing is the most important aspect and will ensure that your business is sustainable. If you have a stock based business, you need to sell stock for around 2.5 X the cost of the product to you. Remember, that includes other expenses such as shipping, postage and package, storage, staffing to do orders, overheads (electricity and rates).
If you are running a service based business, remember to factor in the time when you are not receiving an income from clients. All the time you spend in meetings, book-keeping and answering queries is time that you are not getting paid for.
Do Your Market Research and Competitor Analysis
Market research is an essential part of the planning process. Is your product or service something that people would really want? How much will people be willing to pay? Will this be enough to create a sustainable business? Market research can be qualitative (collecting people's opinions through discussions and focus groups) and quantitative (numbers and statistics). When you try to plan your business, you will need to do both.
You also need to suss out your competition and see if you can compete with them. Can you offer a cheaper price? Or a better service? The businesses that end up being the most sustainable analyse competition and demand and have a USP (Unique Selling Point). What is different or unique about your business that is going to make people come to you rather than anyone else?
Take the Advice of Professionals
If you want to be your own boss, use professional consultants to guide you in the right direction regarding the different aspects of your business. For example, hiring a freelance marketing specialist may be an initial expenditure, but if the turnover or client base expanded quickly resulting in high income, that expenditure may come back to you tenfold.
If you sign up to a freelance website such as People Per Hour, you can find all sorts of freelancing professionals. Can't stand accounting? Get yourself a book-keeper or accountant. Need a website designing? People Per Hour is full of graphic designers, web-designers and SEO (Search Engine Optimisation) specialists. Use your own strengths, but hire or delegate for your weaknesses.
If it Doesn't Work, Change it!
Be prepared to move with Demand and Change with the Times
Remember, business requires you to be flexible. Sometimes things won't work out as planned and you will need the whole way that you originally intended your business to operate to change. That's normal, and it's not a problem, as long as your can accept it and move forward with it. Many entrepreneurs see their first business as their 'baby', but sadly that is usually the one that doesn't work out! In fact, approximately 1 in 3 businesses fail within the first two years. If it's not working, change it. A great book on change is 'Who Moved my Cheese'. It's about personal development as well as business skills.
Sometimes keeping up with technology and changes in the way that businesses operate can throw people off track. If you don't keep up with new developments, such as social media for example, you could be missing out. You could even be dooming yourself to failure. So as a business manager, you will need to read often and keep your business knowledge fresh.
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Finally - Don't Fear Failure
Failure can Lead to Success
Business owners are natural risk takers. Unfortunately, where there is an element of risk, there is a possibility of failure. Remember that failure isn't the end of the world. It is something that we learn from. Most millionaires have made big mistakes in their past, and had several failed businesses before they reach success. A great book about this is 'The Failed Entrepreneur' by Duncan Ridler. It is a humerous and inspiring read.