So you think about going into business you want to be your own BOSS
If you are thinking of going into business for yourself, I hope that this article will be of use to you and may save you a lot of heartache in the future.
Over the last thirty years, I have run a number of small businesses that have provided me with a comfortable living and an early retirement. I have never afforded the luxury yacht, or the second home in the Caribbean because I have never wanted that nor was I ever prepared to take the extra risks involved.
So where to start, you may already be making something that you need an outlet for, or may just want to try something a bit different. Planning and research are two of the key factors that will make the difference in the end. A positive attitude is also essential, but beware of being overzealous.
You need to be both mentally and physically fit to run a business. Sit down and think about what you are going to take on. Running a small business is a twenty-four seven commitment. If you have family, what do they think of your plan? Will they support your efforts, and what happens if you or they are sick, can you afford the time off? Don’t forget there is no sick-pay, any days you don’t work you don’t get paid, unless you have reliable staff or friends who can help out. [That can be another nightmare]
You will also find days off are spent wondering around wholesalers rather than shopping malls. Evenings in front of the tele are accompanied by sessions of bookkeeping and stock control.
So decide what you want to do, be sure it is clear in your mind where you want to be, but be flexible enough to be able to ‘go with the flow’ if need be. I once opened a houseplant shop that quickly turned into a pet shop, or rather two pet shops, and a bulk sale outlet.
If you need a shop front, then you need it in the right place to be noticed. Think about what you expect when you go to a shop, I am not talking about a supermarket I mean a proper local shop. Somewhere for customers to park, is very important these days, perhaps if there are other amenities or shops nearby, that will draw people to you. If you are dealing in a specialist area, let us say model railways, enthusiasts will be happy to travel to you, as long as you have good displays and plenty of the latest as well as the more traditional stock.
Therefore, if you need a large display area, then you need to perhaps think of an out of town location where the rates [the big millstone around your neck] will be cheaper. In addition, rents are much lower. Some councils offer rate reductions for new businesses, there are also government incentives. However, make sure you know the duration of the discounted rates. The down side to not being on the high street is that you may not have the passing trade or footfall somewhere off the beaten track. [No pun intended since I used a model railway shop as my example.]
Rent or Buy?
I would always say rent or lease a property rather than buy one, that way if your project goes pear shaped on you, you can get out without losing everything. That may sound a bit negative; there are other advantages to renting. Firstly, you can put all your rent against your tax. Secondly, a rent can be negotiated with the property owner whereas a mortgage or property loan is fixed, and you will pay a massive amount of interest over the period of the loan.
What are your strengths?
Do you consider yourself as a strategist; able to sit down and look at the long term, or perhaps you are what some like to think, ‘a people person’ good at communicating one to one. Whatever, you need to find your strengths and work on them. One of the strongest things is to know your weaknesses. What aren’t you good at? Will that hamper your efforts? Is there help available, i.e. training at adult education classes or on the internet? Can you handle stress?
Be sure of what you expect from your venture, set targets that will plot your progress.
Who is on your team?
Top of the list might be a spouse or life partner, without their help or backing you will find it even more difficult, which doesn’t mean to say that someone on their own can’t make a go of it.
At one time, you could go along and have a word with your friendly bank manager, but they are not there anymore and although it was the banks that threw the world economy on its head with its greed, they are still very sanctimonious when dealing with someone without a track record I made the mistake of running my first business with my own money, it seemed better than going to a bank at the time, but the downside was I did not have a ‘track record’ with any bank. When I needed funds, they had no idea who I was; except my local bank manager was a customer as were some of his staff and so that made the difference.
Look, for local grants, but again beware they demand a vast amount of planning and will send you endless forms to fill in. If you have the patience, and you are good at paper work definitely try. Late on in my business career I found just how much money and help there is available, and to be honest once you’ve got your business plan and crunched all the numbers and figures for one application it can be used over and again for over grant applications.
The other team member used to be your accountant, but beware they can be pricy and these days the tax return is a doddle for anyone with a modest turnover. If you are not sure go talk to one they will be glad to help and I’m sure they will go easy on a new trader.
Being self-employed has pros and cons, which you must weigh up before you make your decision. I loved the years I was self-employed, it was a challenge, and although at times I wondered, why I had bothered, most of the time I knew why.
There are no paid holidays, but you can work at your own rate, well in theory you can.
You don’t have a boss to worry about; not true really, because every customer is your boss.
I have many friends who are small business owners, they all have ups and downs, but the ones who have been successful are those who were prepared to make their business their life not their job. That being said you must never lose sight of why you are doing it. To make money.
- so you want to be your own boss part two
A follow on to the article of the same name, tips and hints, and just things to think about if you are new to running a business.
I have recently become a 'Mentor' for the chamber of commerce, a scheme set up to give support for anyone wanting to go into business for the first time.
It is mostly aimed at people who have been out of work for awhile, and is part of the UK governments attempt to get people back to work.
I meet up every two weeks with my 'Mentees' and we discuss where they want to be heading with their business idea. They off-load their doubts and fears and hopefully I can give them a shoulder to cry on and useful advice. Your local job-centre should be able to tell you if the scheme is available where you are.