Starting an entirely new business is unchartered territory for most people. It offers great rewards, but equally high risks. Before you set up shop, you need to think hard about whether you have the right temperament, leadership skills, support system and dedication to be an entrepreneur.
Evaluate your strengths and weaknesses by answering these questions:
1. Are you a self-starter? You need to be able to develop and drive projects, manage your time and follow through on details.
2. Are you willing to work long hours? When you own a business you’re committed to it 24 hours a day, seven days a week, particularly during the first few years.
3. Are you good in making decisions? As a sole owner you will have to make decisions quickly, under pressure and on your own.
4. Do you plan well? Research indicates that many business failures could have been avoided through better planning. Good organisation of financials, inventory, schedules and production is the oil that keeps any business engine running smoothly.
5. Do you have the strength to stay motivated? Running a business can wear you down, especially when all the responsibility is on your shoulders. It takes strong motivation and passion to survive a slump in business, or periods of burn-out.
6. Are you willing to invest? True entrepreneurs put their money where their mouths are, and this might even mean using personal savings or property.
7. Have you considered the possible impact on your family? Starting a business can be hard on family life. The strain of a husband who isn’t behind you 100% may be hard to balance against your new business demands. There also may be financial difficulties until the business becomes profitable, which could necessitate lowering your standard of living.
8. Do you have a network of friends or associates who could provide outside financing? Insufficient capital is a key cause of small business failure. If you are not able to obtain enough funds from a bank, you may need to rely on funds from friends and family. Most start-up businesses are funded this way.
If you can answer YES to most of the above questions, then you may have the potential to join the ranks of successful business owners. If you cannot, you need to consider whether starting a small business is the best solution for you.