Many professionals work for a number of years for corporations and then wonder if they should start their own business. Although this can be very rewarding in the right circumstances, there are several factors to consider before going this direction.
Firstly, do not leave your corporate job without seeing first if there are more intraprenerial or flexible opportunities at the corporation (or another one). If financial security is an issue, this can be the best route. Many companies are trying harder to retain good workers through increased work flexibility and more job enrichment. Also, you often can be involved in larger and more interesting projects within a company than what you can access in the early years of your own business.
If you still want to go ahead, I have compiled the following list of rules to help you avoid common pitfalls. (derived from hundreds of reviews of small business successes and failures)
1) Make sure that you have some experience or expertise in the business that you are looking at. If it is not with that particular service or product, it should be with the type of industry or customers that will be involved.
2) Prepare a business plan, complete with financial projections and marketing strategies. Present it to other people who can give you objective feedback and create discussion. This will force you to think through what you will need to do and the feasibility of your plan. If you will need financing for the business, you will need to present a business plan to the lenders.
3) Talk to other people in the business and observe what they are doing. Learn from others” mistakes.
4) Develop a network of support people who can help you on your way.
5) If you are looking at purchasing a business, make sure that you get good legal and financial assistance.
6) If possible, run it first on a part-time basis to see how viable it really is and whether you enjoy it. This is not always possible, but is the easiest transition to success.
7) Make sure that you have enough money saved up to allow you to start without undue financial stress and pressure. Depending on the type of business, you may not make any profits in the first year or so. It is important to take some time to develop networks and relationships that will pay off in the future, so you don’t want every meeting to be about “hard-selling”. If you are desperate for business, your prospects will often sense this and either grind down your pricing or be scared off. Think about yourself in their shoes. Your personal life will also take a great toll.
8) If you are thinking about a partnership, be careful about choosing your partner. This is critical, since differences in priorities can be catastrophic to a business.
9) Make sure that you have the right personality factors to run your own business. You don’t need to have all the recommended qualities but you need to figure out how to deal with the ones that you don’t have. There are several online quizzes that you can go to and test yourself on this. Here’s a link to one of them. http://www.entrepreneur.com/personalityquiz
10) Have passion for what you are doing! If you don’t have the passion, you will not have the enthusiastic energy required to reap the rewards.