Guest post by Gwen Payne of InvisibleMoms.com
Everyone is tempted by business ownership at least once in their life. Running your own company can be freeing and profitable, but it can also be stressful and costly if you’re not careful. If you’re thinking of taking the plunge, rather than committing yourself entirely from the outset, it often makes sense to take precautions and first dip a toe – here’s how to get started.
The main risks for those turning a hand to entrepreneurship are financial. Unless you’re able to secure investment from the get-go, the funds to move things forward will likely come out of your own pocket. This means you have to be certain to negate the risks – money you spend on a failed business is money wasted. The first precaution you can take is to write an airtight business plan. This plan should describe your company, outline OKRs, KPIs and map out potential expenses, giving you a realistic idea of how much the operation might cost. A strong business plan can also be used as a tool to invite external investment, taking some of the onus from your own shoulders.
If you find the costs of running the business are beyond your financial means, it’s worth sticking to the day job and funneling any excess income into the company on a day-to-day basis. This will help to ensure your own personal long-term security as well as a safer, more gradual approach to the formation of the business. At this early stage, make sure that every dollar invested is being used efficiently – any extraneous costs such as office space, PAs, recruiters, food orders, etc. should be avoided until the company can afford to support itself.
The most important measure for ensuring the success of your business is research. Regardless of the funding, if you’re not making informed decisions, you’re liable to end up making expensive mistakes. Market research on an entrepreneurial level is carried out by the individual, but as long as you have internet access, you’ll still be able to draw from the wealth of publicly accessible data sources or conduct your own primary surveys via social media. The main goal of your studies should be to identify market demand for your product/services and then to distinguish the demographics that you are likely to appeal to.
One of the shortcuts to testing the temperature of the market is to analyze its incumbent brands. These are going to be your competitors, so you need to be certain that they’ve left gaps – will you be able to match their offerings? Do you offer anything new? Without a strategy of your own, you’ll face an uphill battle trying to outwork, outsmart and out-advertise a firmly established industry leader.
Time is money, and that means you also need to be careful about how much of it you dedicate. To begin with, it’s worth limiting your efforts to weekends and evenings but, if you can coordinate with your current employer, it often makes sense to also commit mornings to the project – it’s not just how many hours you’re giving up but the quality of the hours themselves. Often, we’re more productive at the start of the day.
If you struggle to time-keep and balance multiple tasks at once, you should consider downloading an app to set alerts and help you keep on top of everything. It could also be worth listing the business as a Texas Limited Liability Company (LLC), this can save you time on paperwork as well providing tax advantages.
When transitioning to small business ownership, the gradual approach is often the most sensible approach. By taking your time and moving slowly, you’ll be able to see further down the road and avoid mistakes made in haste.
Gwen Payne is a stay-at-home mom with an entrepreneurial spirit. Over the years, she has mastered raising her two daughters while side hustling to success through small ventures based on her passions — from dog walking to writing to e-commerce. With Invisiblemoms.com she hopes to show other stay-at-home parents how they can achieve their business-owning dreams.
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