Hi all
At 33, after 14 years of a corporate salary (and a uni degree or two), I’ve had enough of my current job (and the reasons for that are a whole 'nother pit thread), and as from 4 March 2009, I’m completely salary free. I think I’m going to be ok, and I have a very lovely husband who will help me through (if need be) a couple of tricky months… but dopers who have owned your own … tell me where I’m going to go wrong… please 
Thanks.
thren
x
You don’t mention what you will be doing as your own business, but my greatest challenge was cashflow, and making sure that it stayed positive (it didn’t, we had to kick in four months of operating costs in order to pay suppliers)
Second biggest piece of advice - if what you are doing is servicing clients, try to have at least one signed on before you launch
Never actually owned a small business myself, but have worked in the finance industry lending to the SME market for the last 12 years.
Rule #1 - whether you are seeking finance from a Bank or not. DO A BUSINESS PLAN!! and do one before you start the business. You need to sit down and plan out what you want to do, what you want to achieve and how you are going to achieve it.
Try and be realistic about it, try and work out some hard numbers to go in there if you can.
A rough guide for what you want to look at in the business plan is a SWOT analysis.
Strength’s
Weakness’s
Opportunities
Threats
I’ve seen business plans from small 4 page summaries to 40 page manifestos. But the common thread is the potential business owner has sat down and thought through what they want and how they will go about it.
Two things off the top of my head. First, if you think it’s going to be a tricky couple of months, you’re fooling yourself, you’ll probably work harder then you’ve ever worked for the first couple of years. Then it’ll only get easier if you have good employees.
Second, you didn’t mention what kind of business it is, but this will still most likely apply. If there is something you LOVE doing, don’t start a business doing it, go work for someone else that runs that business. When you own a business, you usually will be so tied up with everything else you don’t have much time to work on the actual end product, whatever it may be.
Hate to be a downer, but it’s the truth. You’ll get so tied up on accounting, meeting with the bank, meeting with vendors, CPA’s, other business people, bookwork, ordering product, making sure the bathroom is cleaned everynight, going back at 2:00 in the morning becuase the alarm is malfuntioning etc etc etc that you won’t have time to actually work on the widgets. The problem comes when you go and work on the widgets and all of a sudden your payroll taxes are late or you never got your finacials to the bank and now they’re calling the loan.
All though things will start to turn around if you can get a really great crew working under you to take care of some of that stuff, but still, it’s an incredible amount of work.
I suppose it depends upon what kind of business it is. I started my consulting business from the sunroom of my home in 2000. I don’t have vendors, a CPA, or employees so I have plenty of time to work on projects.
I did have to use credit that first few months to pay bills and buy groceries. However, I didn’t have a husband at that time either.
I agree that you should have a business plan. I also think you should have a plan for household budgeting; you and your husband should both have a clear idea of what’s going to happen (budget-wise) for the next six months.
Good luck!
We have done this topic a dozen times. The answers are generally very useful, but they depend very strongly on what you want to do.
Just last week we talked at length about somebody whose relatives wanted to start a restaurant. We’ve also done retail, consulting, and a few other things.
If you have nil overhead (pace NinetyWt), and an established customer base, it can be a pretty straightforward transition.
OTOH, if you want to start a non-franchise combined pizza / sushi joint, there’s a little more involved. Or a specialty manufacturing firm.
My wife went from lawyer-passed-over-for-partner to self-employed-lawyer-with-all-the-old-firm’s-specialist-clients in about 1 weekend. That was real easy & involved a major income boost from Day 1. That also was a 1-in-10,000 story.
Conversely, my own start-ups have consumed years & (no exaggeration) millions of dollars to get to profitability.
Bottom line: Tell us the general outline of your business idea & we can get you some decent answers. OTOH, “I wanna starta business; what do you think?” is not going to elicit much useful advice.
I can tell you what not to do, since an ex-relative of mine did it. :smack:
He found a existing small novelty business that was doing well. Without consulting an accountant or a lawyer, he bought it.
Since there was no clause in the contract to stop the previous owner from opening up a rival business immediately nearby, that’s what happened. And all the customers went to the previous owner.
And my relative went bankrupt. :rolleyes:
(Did I mention ‘don’t put all your savings into the business?’
If you are looking for funding to get started, you might want to google “IDA programs” along with the state you live in. I just recently read about these, and it seems like they will match your savings to help you get started or expand your business. You have to take some classes that are free on credit and other stuff, but it looks like a good way to get started if you have pretty much no assets.
Your local university’s business school probably has an office for small business development or something equivalent. Talk to them. They can give you better and more specific advice than we can, they can walk you through putting together your business model, and they may also be able to put you in touch with venture capitalists and other sources of funding.
Profit good
Cash flow better
Also, your local public library might have a small business resource center - like this one from my local PL - that provides workshops and resources to help get started.
I’d also check out SCORE for tips and such.
Thanks everyone for all your advice.
To elaborate
I’m a writer. I have published a book, am currently writing my second, have a contract as an editor for a third and have picked up bits and pieces here and there for other writing needs ranging from creative to technical to not-for-profit. Two of these are long term contracts (10 - 20 hours each per month for the next 3-4 years).
At this point in time fingers crossed it looks like my issue for the next couple of months is too much work, not not enough work. However, I am a trusting soul. And what worries me is being taken advantage of and not even realising it.
I have mapped out and signed contracts for work for the next couple of months, and word of mouth is beginning to spread in agency land here (Advertising world in Sydney is relatively small).
I don’t plan to have employees, at least not in the forseeable future, if ever. My mum’s an accountant and she is going to help me with taxes etc. I’ve been thinking about this for a while, it’s a positive step for me, even if it does mean I’m back in wanker-world (apologies to any advertising people out there… it’s not directed specifically at you, rather the industry and the mindset in general) in a couple of months.
Find a good lawyer and a good accountant. I suppose you could use your mum if you want.
Yeah, you know I never thought about a lawyer - will definitely look for one. I am currently looking at the cost of Professional Indemnity insurance also.