Six Questions to Consider before Starting Your Own Business
“I have a job that doesn’t really challenge me. I have great ideas for a new business, but need help getting started. How would I begin to get this idea off the ground?” — June, San Francisco, CA
Entrepreneurial spirits like yours are one of the reasons America is great – a great idea can turn into a great product, a great service and then into a great business. But how do you start?
The good news is that start-up small businesses can be a path to the American dream. The U.S. has 27+ million small businesses, and between 60-80 percent of all new jobs created in our country can be attributed to these businesses. Consequently, entrepreneurs are nurtured and resources are out there to help turn your idea into a reality.
Begin with these six “smart starts” — questions to consider as you prepare to get your idea off the ground:
- Is it feasible?
Assessing your business idea and yourself as an entrepreneur are critical first steps. Define your personal vision and goals. Develop a feasibility plan. Research market demand and competition.
- Do you understand what running a business is all about?
Before becoming the CEO of your own business, you have to be the chief cook, bottle washer and bean counter in the early stages of business development. Be prepared to do it all. You may be the brains and the talent, but can you run the business side or do you need help?
- What experience do you have in this field?
Do you need additional training or education? Do you have the skills for your business or do you need to hire others? Don’t rely on family members to help you in the long haul. What looks like fun a few weeks per year will become a drag when it is a daily requirement.
- Do you know your local requirements for operating a business?
State and local rules can govern everything from licensing requirements, zoning, types of corporation, and legal and tax implications. For more resources on microenterprises and where to start in your own community, look at these websites: http://fieldus.org/index.html and http://www.microenterpriseworks.org/
- Do you have the resources?
Consider your current finances and get a realistic picture of your cash flow for the first 6 months, 12 months, and 5 years. Can you make money doing this or is it more of a hobby? Would you benefit from a financial literacy class or advice from Credit Counseling Services? Also, don’t forget to consider how much time you have available; after all, time is your most precious commodity.
- Are you trying to reinvent the wheel?
There are successful business-people and entrepreneurs out there who have been there and done that, and are now ready to help others succeed by sharing their experience and expertise. Find mentors at www.score.org
Seeking out programs that offer resources and support specifically to microenterprises can pay off. Participants in these programs saw their average household income increase 17 percent, according to a 2008 study. Another survey reported a 60 percent increase in median microenterprise revenues from approximately $52,000 to just over $82,000 (source: FieldUs.org).
A note of caution, though, as you begin the journey toward your new business: It takes time to become self-sustaining. It also takes resources, talent, and a bit of luck. So, don’t quit your day job. Seriously, in this economy, a stable job—even one that lacks challenge—is hard to come by. Dedicate time and energy to pursue your dream, but make sure you can pay your bills at the same time. Smart, sustainable growth will pay-off in the end vs. an impulsive jump into the deep end.
With the right help and careful planning, you too can dare to dream big!