Published June 2005
Should I Start My Own Company?
For many it is a dream of freedom and riches. As a small business owner you set your own hours. You can pay yourself what you want and you can write off many expenses that would normally be paid for using after tax dollars.
Yet anyone who has ever failed in business understands that these "all-too-perfect" perceptions cloak the darker reality of going into business for yourself. Running your own business is difficult. There will be times when everything is going well, but you also need to be prepared for times when you literally do not know where your next dollar will come from.
Everyone who starts their own business is taking a risk. We have seen people lose their life savings in dot.com ventures. We have also seen entrepreneurs turn a simple concept like manufacturing candles or running a mini-storage operation into highly profitable businesses.
There is a big difference between building a business and being self-employed. When you are self-employed you may only need a handful of customers to keep you busy year round. The advantage of self-employment is that you can develop a steady revenue stream faster. The drawback is that you will always depend on yourself for income; when you build a business you are ideally creating an entity that will eventually be able to run itself without your participation.
Before you decide to start your own business there are a number of questions you should consider.
Questions to consider before starting your own business:When faced with a serious challenge do you stick it out and solve the problem or do you prefer to walk away?
Determination is a key to succeeding in business ... if you prefer to walk away then self-employment may not be your best option.
Do you have existing experience and contacts that will help you build your customer base?
Do you have the financial resources (savings or part-time work outside of your business) to get you through the tough start-up phase?
Will your family support you?
Are you comfortable with sales?
Can you evaluate yourself honestly?
Do you have business experience?
|Useful Start-Up Skills & Attributes
Careful risk taker
Ability to sell
Understand business finances: (balance sheet, profit and loss statements, cashflow forecasting, break-even analysis and basic bookkeeping)
Consider these questions carefully and when you are ready, analyze your own skills using our simple self-assessment exercise, Understanding Yourself.
Categories: starting a business