Cynthia Macy asked: Do you have the right stuff to make it work? Ask yourself these five questions before making that leap from steady paycheck to entrepreneurial uncertainty:
1. Are you a self-starter? You must have the self-discipline to plan, set goals, not procrastinate and stay focused.
2. What are your expectations? Do you think you’ll work less and have less stress and more money? Think again.
3. What are your financial goals? Be prepared to work more for less money, at least in the beginning. Set up your retirement plan in the beginning and stick to it. Forget vacations and be sure to keep your health insurance going….now there is no one but you to take care of these things.
4. Can you plan and organize? You’ll be making countless decisions each day. Can you make a workplace for yourself that is free from distractions, where you can think, plan and communicate? To be a success, you must combine your fantastic ideas and business tools with solid planning and organization.
Success is never guaranteed and the variables and factors can sometimes be out of your control. But if you ask yourself honestly, before taking the plunge: Do I have what it takes to run a business? The answer should tell you if the “American Dream” is right for you.
95% of small businesses fail within the first five years? Why?
Here are a few reasons why:
1. Mistaking a business for a hobby. Just because you “love” to cook doesn’t mean you should/could start a restaurant.
2. Poor planning. Have you researched all aspects of start-up costs and on-going expenses? Do you know what your monthly nut is going to be and do you have enough capital to carry you through for several years? Do you realize the sheer number of hours you’ll be working? Do you have the management skills to wear all the hats necessary?
3. Only one product, one service or one big client. Markets change and needs change…will you have the foresight, flexibility, resources and ingenuity to change with the times? Diversification will cushion you against the ebb and flow of business tides.
4. Poor record-keeping and financial controls. If you don’t know how to keep records and do accounting and file taxes and other business filings, find an expert to do it for you! Learn how to review your revenue and expense reports each month so you always have your finger on the pulse of your business.
5. Poor money management. Be prepared to plow all revenues back into your business for the first several years. No frills, no thrills, stick to a budget and a plan and forget vacations. Don’t use any of the business income on personal spending and watch your business and personal debt, it can kill your new business faster than a speeding bullet.
6. Wrong location. Can your customers easily find you? You know the old saying “Location, Location, Location!” What about visibility, image, parking, room to expand?
7. Competition. Check out your competition. Know who they are, what they offer and what makes your products or services better (or worse).
8. Poor time management. Wearing many hats is a reality of an entrepreneur. Learning how to manage your time means the difference between success and failure. A daily “To Do” list is essential, with the top priority items at the top of the list. Hire help for those things you don’t know how to do or **** to do.
9. Lack of Marketing and Sales Skills Keep track of what marketing/sales ideas work and don’t work and quickly drop those that don’t work. Hire a pro if you need to.
10. Poor Customer Service. Once you have a client, you need to keep them. This means you have to pay attention to the customer, fulfill their needs in a timely manner, return their phone calls and emails promptly, bill them properly, utilize a win-win problem-solving attitude and BE NICE!
11. Entrepreneurial burnout. Owning your own business requires a huge investment of time, money, energy and emotion. Take time off for yourself, you are your greatest asset!
A lot of people do not realize that entrepreneurs play a big role in our society.
When you put the total number of entrepreneurs together, they count as the biggest financial contributors to our nation’s wealth. If only politicians would give grants to finance small business start-ups, the economy’s growth could be hastened.
Knowing the obvious financial rewards and the important role to society of business owners, many individuals aspire to be entrepreneurs. The fact remains, however, that several business start-ups fail and never take-off from the ground because of one thing: the lack of adequate and sufficient knowledge on how to start and run a profitable business.
With proper planning and research and the necessary professionals to help you in the areas that you are lacking in, accompanied by adequate capital and resources, and fed by imagination, energy, excitement and self-discipline, you could be one of the many successes that is the backbone of the American economy.
Gary
