I am a wage slave who has been saving up for quite some time. I’d like to be my own boss and own my own business. The obstacle is that I have no idea what’s involved in running a business except that you try to make more money that you spend.
What’s considered an inexpensive starter-type business where I can learn the ropes and not completely lose my ass if/when I run it into the ground?
Don’t
You think you do, but you don’t. Working 24 hours a day kinda sucks.
Kinda, yeah, I guess that makes sense, the trick is doing it…and making sure the employees don’t steal the profits while you’re doing it.
Nothing, literally nothing is cheap or easy. If there were such a thing, everyone would do it. I mean, there’s MLM stuff if you just want to buy a bunch of crap and pawn it off on your friends, but IMO, that’s not owning your own business, regardless of what the marketing material says.
My suggestion is to go work in a small business, 5-15 employees. Doesn’t really matter what the business is, unless it’s so specific they have strange compliance they need to deal with, they’re all pretty similar and if it’s a small place you’ll get a really good feel for the day to day operations instead of just being shuffled off to your little area and having no idea what goes in the rest of the building. The cashier at your local megamart doesn’t know what goes on upstairs but the person the runs the register, sweeps the floors and helps prep the dough at the mom and pop bakery might be able to tell you that the owner is in back right now trying to figure out why his quarterly payroll taxes aren’t reconciling.
Also, from The E-Myth Revisited, if you want to run a business, run a business, they’re all pretty similar, if there’s something specific you want to do (make pizza, cut hair, sling drinks) go work for someone else, you just don’t have time to own a business and work in it at the same time. (Maybe with the exception of, say, selling insurance by yourself or some other 1 or 2 person operation).
Depends on what type of business you want to get after the prototype. Small retail outlets aren’t very difficult to deal with if you don’t care about making money. Lot’s of people with no business experience at all start them, and some of them succeed. You might be better off making an investment in a business that someone else runs to learn the ropes. Partnerships can be a pain to deal with, but if you don’t care about losing your investment then it shouldn’t be that bad at all. You’re going to need some exposure to business taxes, but an accountant can take care of that for you. You’ll need to learn about permits and regulations, insurance, payroll, employment law, customers, managing, hiring, and firing employees, and crooked officials who rip you off. Then you need to be prepared to every job in the business because any employee may not do what they’re supposed to. You need to be able to manage the paperwork because even here in the super-duper age of computers you still can get stuck with paper. Then there are suppliers and all the contracts they’ll make you sign, not to mention needing a lawyer when you start the business. And then there’s customer service, the toughest part of the job for some people, you can’t believe what some people will complain about, and now they can do it on Yelp if you can’t satisfy them.
If you buy an existing business you’ll find out the books have been cooked, the established customer base doesn’t exist, all that valuable equipment is junk, and no one wants all that stuff on the shelves. And don’t expect any legal recourse if you’ve been ripped off, it’s caveat emptor when it comes to purchasing a business.
Also, whether you start a brick and mortar operation from scratch or purchase one you can expect to spend a lot on bringing the facility up to current codes.
Or you can just start an online business and buy the software to do almost everything and try to grow it before you get into all those other headaches.
I’ll give you one piece of solid advice, don’t buy a restaurant unless you enjoy working every waking hour for nothing and never seeing anything that resembles a profit.
I was thinking something like this, something very small or a coin-op thing. Try it out, learn the ropes, improve it or burn it, then try something else.
Farms have this kind of thing - I have a guy I hire a few times a year to bushhog my pastures. He has a small used Kubota tractor and 6’ bushhog. He makes about $100/hr mowing fields. Add a front-end loader and you can move and spread gravel, etc. The tractor was about $13K. He’s a retired cop. After paying off his equipment, it’s all gravy. Gas for the truck and tractor and a trailer. Craigslist ad.
My farrier charges $30/horse to trim hooves, $80 or more for shoes. Most horses are trimmed or shod every 6-8 weeks. $8000 for training, equipment. It takes about 15 minutes or less per horse to trim. Pin a card up in feed stores, ad on Craigslist.
StG
It depends. What do you know how to do? What kind of business do you want to be in?
Most businesses like owning a restaurant or bar or brick & mortar retail store require some significant up-front costs. Plus they have significant recurring costs in the form of inventory and staff that need to be paid.
A lot of people work as “freelancers” or consultants. Typically in technology, management, graphic design, accounting and other jobs that companies need on a short term project basis. But I tend to look at these jobs as glorified temps. It’s not a scalable business since they are the product and can only work so many hours a week (plus selling new work).
Real estate sales maybe. Maybe a food truck if they have those where you live.
Watch that reality show “The Profit” or the other one where Gordon Ramsay turns around shitty restaurants. I like them better than Shark Tank, which is really just idiots trying to get investment capital from billionaires for their idiot ideas. The other shows deal more with the operational nuts and bolts of making a small business successful and deals with the issues than can crop up.
All of the above about starting (or buying) and owning a business is pretty on target. In my career, I’ve been various levels of wage slave (including a corner-office wage slave), a remote employee, and self employed at levels from solo and portable to co-manager of a 100-employee agency. I’ve also contended with and competed with many “small businesses” of various kinds.
So I can boil it down to three simple rules that will either eddicate you or (if flaunted) kill you slowly.
** 1. Know how to do something that people will consider worth paying you to do.** You’d be surprised how many would-be entrepreneurs miss this one and assume that some fluffy hobby skill is enough, or taking a few community college or Learning Exchange classes, or (absolutely worst of all) buying into a system/franchise that promises to teach you something useful in two weekends after you buy their machine or package - that these E-Z routes or shortcuts actually put you on a marketable level.
2. Know how to run a business. A repeat of what’s above, except that a lot of people who are badass experts as an employee have NO idea how to run a business selling that expertise. A few classes in business operation and accounting can be enough for businesses that don’t have special demands like licensed employees or hazardous operations.
3. Be prepared to give up the rest of your life for years. You can’t be very successful, or even get to the self-sustaining level, without a lot of long, hard, often unpaid hours.
Those are the basics whether you want to be a freelance writer or go head to head with Boeing Aerospace. And then there’s **Rule 0: Have enough capital to see you through the self-sustaining point. **There’s no point in launching a business that goes broke before you’ve acquired enough customers, even if everything else you do is spot-on correct. Rule of thumb: if you can’t operate with no income over (maybe) cost of goods for six months, you aren’t financially ready. Those bootstraps will break right off.
My husband and I started there, and then we started placing other people. Two months in a three person business (a long time business friend of my husband’s has the sales piece) has about $100k in profit a year (excluding the consulting my husband does). It isn’t enough to be our whole income yet, but we are only hoping for about $300k in profit a year - so two months in we are a third of the way there. So its possible to make it scalable, but you have to stop selling merely yourself and start selling other people.
However, we can only do it because the two of them have an extensive network on both ends of the business. And because I’m so darn frugal that we were already semi-retired, so we had time and savings to take the risk.
I know quite a bit about computers/IT but I’m quite weary of it. Mainly I would just like to collect checks and deposit them.
Yeah, that business doesn’t exist. Not unless you have a lot of capital.
Just remember that there’s an easy way to start a new business and have it be worth one million dollars in just one year. First, start with two million dollars…
You can get away with that as a “wage slave.”
As a business owner you have to actually do something to earn it. 
C’mon, there must be something. Vending machines? Garbage truck routes?
Whatever it is, I know restaurants aren’t it.
I feel like the mafia controls most of that. But that might just be a Hollywood stereotype.
You could try buying some rental properties. It’s still a bit of work if you have to manage them yourself.
Well, yes. Then you are running a small consulting firm.
The firm I work for is like that. It’s about 40 consultants, mostly ex Accenture, Big-4, Booz Allan types. The problem with those sort of firms is that there is a lot of competition in the “general performance improvement strategy operations program/project management IT consulting business”. Mostly from other similar small firms made of ex-big firm managers and partners also leveraging their personal network. So unless you offer some sort of differentiating service, it’s hard to move outside of your personal network and grow in any meaningful way.
Well, a quick google search gives you all sorts of business plans for vending machines. I think your hardest obstacle would be sales - you need to get your machine into a spot where there is sufficient traffic to support the machine - and where there isn’t one already or where you can offer something over what the current vending machine company offers to replace the one that is already there. I can’t think of too many times I’ve thought “I wish there was a vending machine here.”
Garbage trucks have a LOT of capital - those things aren’t cheap.
Which we aren’t interested in doing. We are interested in supporting three people. But it isn’t that type of consulting - that’s what I used to do (PM consulting), we are working mostly with high end developers.
But there are lots of boutique firms like ours out there - and they often grow from independents who end up placing people they know with the clients they have. “I’m not available, but I know this guy…”
And it isn’t just that sort of consulting. A friend of ours owns a PR firm. He started as “one guy” and then had enough work where it was “one guy and a freelancer he marked up” - at one point he had half a dozen employees or something, then decided he liked doing PR, not running a business - and he’s back to being one guy. Makes less money - is happier.
Whatever you do, don’t attempt it if you have a drinking problem. I speak from personal experience. :smack:
Find out if there’s a https://www.score.org/ chapter in your town, and if so, make an appointment to talk to them. I did before I started my business, and while they weren’t all that helpful for me, they certainly were for the other client in the room. She was a 20-something who wanted to start an organic food co-op, and realized during the conversation that she had absolutely no idea what she was planning to do or how to do it.
Start with something small. Don’t give up your day job. You say you know computers. Let it be known in your friend circle, neighborhood newsletter, church, etc. that you’re available for computer help at $X/hr. People will start calling you for help setting up their home routers and stuff like that. You don’t have to do a lot of paperwork at this point. A simple business like this would get the money added to your normal income on your taxes. You have one or two forms to fill out when you do your taxes where you list what you took in from the business and what your expenses were (ads, mileage, computer equipment, etc.) Any of the normal tax filing software can do the taxes.
You can do this on nights and weekends at your convenience. Eventually, you will build up a wide circle of clients who may start recommending you for other jobs, some of them larger. Stuff like a doctor’s office may need someone to help setup their network. Once you get a bit bigger, you can form an LLC, get an accountant, and things like that. But that will be after a while where you have more experience. At first, you’ll just be making beer money and learning if you really want to be a business owner. But if this side business flames out right away, no big deal. You won’t lose a lot of money if it fails.