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During challenging times when there are significant pressures on employees and redundancies are rife, the thought of escaping the rat race to start your own business can be appealing.
Most of us would love to control our own destiny and go it alone, but is that path really right for you? Have you spent time reflecting on whether you have the courage, determination and persistence to build your own business? Do you understand all the risks and the challenges?
There is a myriad of elements you must consider before making the leap into entrepreneurship and being your own boss. Starting a business takes a great deal of hard work, planning and strategic thinking.
In this article, we explore the top 10 questions to consider if you’re thinking about starting your own business.
Not everyone has an entrepreneurial mindset. However, with careful planning and an ‘eyes wide open’ approach, even the faint-hearted could make a go of it. Ask yourself:
There are four main options when setting up your own business:
You could leverage your existing experience and go into consulting. Armed with a phone and a laptop, it’s a matter of learning how to market your consultancy, finding your first client, setting your fees, and delivering excellence.
Pros:
Cons:
You could build your own business by starting from scratch – the beauty of this is that you can set up any kind of business you like. Of course, it depends on demand and whether anyone will buy your service or product, but that’s where your research beforehand comes into play.
If you buy an existing business, it will have systems and procedures already in place, plus an existing customer base. Conversely, you may inherit problems that are not immediately obvious, so due diligence is essential.
Franchisees gain the benefit of a well-known brand, systems and procedures that work. However, you won’t have the creative freedom of a business that you set up on your own. Plus, franchise fees can be pretty hefty.
Your business can’t be relevant to everyone, and trying to go too broad with your product or service offering can lead to confusion about your purpose and mission – both internally and externally. Take time to really think about who you want to target, including:
A business plan will help you organise your strategy over the short and long-term. You don’t have to stick to it religiously, but the more comprehensive and set out your plan is, the more prepared you’ll be. With a comprehensive business plan in place, you can also use it to approach banks, angel investors or venture capitalists for funding.
You must register a business name if you are conducting business under a name other than your own personal name or if you are setting up a Pty Ltd company. If you decide to become a sole trader and run your business under your own name, you don’t need to register for a business name. But you need an Australian Business Number (ABN) in order to invoice clients and customers.
However, as a sole trader, if a customer makes a legal claim against you, you have no financial protection, so you must ensure you have adequate insurance cover.
Setting up as a Pty Ltd company will protect your personal assets from most claims as the liability is limited to the business as a separate entity. Talk to your tax accountant for advice on the structure that will work best for you and your business. Your accountant will also advise you of when you need to register for GST.
For information on business registration, business structures, business grants and more visit the Australian Government’s resource for businesses.
You must speak with an insurance broker in your field to ensure that you are adequately covered. Depending on the business you’re in, there may be specific insurances you need, such as workers’ compensation, professional indemnity or public liability insurance.
Having a website with your own domain is a good way to get your business out there and help people find you online. WordPress is a popular platform to use, with many professional templates available. You can also explore templated platforms such as Shopify (for e-commerce), Squarespace, Wix or Simplero.
Alternatively, you may wish to hire a web designer to create your website for you.
It is possible to start a business with little-to-no capital. Consider what your brand should stand for, and invest your limited funds into marketing strategies that will attract customers to your business.
Your ongoing reputation is also important, so ensure you work with the best suppliers possible for your products or services. Create a strong service level agreement so suppliers are accountable to deliver quality.
Finances aside, there are many logistical factors to work out when starting a business. Think about:
If you are still employed, ask yourself these questions before you quit your job:
Owning a business takes hard work and determination. If you have the courage and persistence to build your own business, and understand the ongoing risks, self-employment can be an exciting and rewarding new direction.
Looking for the right hires for your new business? Talk to a Michael Page recruitment consultant today to discuss your needs.
