Most people want to start a business but don’t have the necessary funds to support their families, while paying for all the startup costs. With some strategic planning, here are some of the fundamentals to successfully transition out of your job into your dream business.
Make the Commitment
To be successful in business, you will need to be 100% focused. Since most small businesses fail in their first year, you will want to consider having a business coach, complete a business plan and know how long it will take to get a return on your investment. The Service Corp of Retired Executives, SCORE.org, a non-profit organization, can provide the resources to help you complete these steps. There are going to be many learning curves in your early years but if you stay committed, the “fruits of your labor” will pay big dividends in the long run.
Get Your Finances in Order
You will need capital to get your business started. Most people are not aware that the Small Business Administration, The SBA, has a loan called the 7A Express that will allow you to fund your business up to $150K unsecured. Your credit score has to be a minimum of 680 and your loan amount has to be equivalent to your net worth. If the business is home-based, the turn-around time to fund the loan will be very quick. However, if you are starting a retail business, and you are borrowing over $150K, the SBA rules are more stringent. You will also want to make sure that if you are married, one spouse can support the household expenses, so that you don’t become financially pressured to pay your bills. If you are single, you may want to have a minimum of 12 months of savings before beginning. The number one cause of business failure is not having enough capital. Examine your expenditures for your first year and complete a proforma to ensure that you have enough capital to cover your business and household expenses.
Do Your Research
While it is important to be passionate about your business startup, it is equally important to study sector growth and consider how your industry is trending. The government publishes data which will allow you to review business trends before you begin. It is also important to consider “piggy-backing” additional services that you may consider adding to your primary business. You can grow revenues by cross-selling to your database of clients by offering multiple services and increasing your revenue much quicker. As franchise consultants, we can help you conduct the proper research.
Take the Plunge
At some point, you have to be confident that you are ready to begin the process. Once you make the commitment and complete all the necessary steps, most new business owners feel relieved that they are making the commitment to start. Beginning any new venture takes courage but with the right strategies and support you will find that it is not as difficult as it seems.
