Deciding to venture out on your own is certainly nothing to take lightly. If you do it and succeed, then that is great. But, you have to be ready to not go as high as you want to go as quickly as you intend to get there just in case starting your own business isn’t what you thought it would be.
So, how do you know if it’s time for you to take the leap into self-employment? Ask yourself these five questions:
Can you afford to fail?
No one sets out in the world of entrepreneurship just to fail. But, you have to be ready for this to occur just in case it happens. Specifically, you have to be able to sustain yourself financially in the event that your business doesn’t take off like you thought it would.
This may require having enough money set aside to get you by for six months to a year. Although that may seem like a lot, most businesses don’t start to pull a profit until five years out and that’s if they survive at all. So, the more you’re able to sustain yourself during that time period, the more likely you are to stick with it to make it work.
If you don’t have some sort of financial fall-back plan at the moment, you’re likely going to want to create one before you plunge into the life of self-employment. Determine how much money you’ll need and come up with how you’re going to get that amount prior to doing anything that will jeopardize your future well-being.
Are you organized?
Being your own boss means that you have to create a system in which you know where everything is the moment you need it. You need to come up with a way to make sure that nothing falls through the cracks, leaving you in a vulnerable position.
That’s not to say that someone who is disorganized cannot run their own business. We’ve all probably worked for people that can’t find their desk because it’s buried under mounds of paper that is scattered about, but it certainly will make it easier if you have a place for everything (and make sure it’s in it).
If you aren’t very organized, there are lots of tools to help you. There are computer programs that can keep your information right at your fingertips. Or, if you plan to hire someone else as you start your business, maybe you’ll want to make sure it is someone that has excellent organizational skills to keep you in line. (However, you’re also going to want to make sure you understand their system so you don’t find yourself in a predicament should their employment ever terminate.)
Do you need a lot of direction?
Being your own boss means that no one is there to motivate you to get things done or push you in the right direction. You have to be willing to get yourself out of bed, tackle your to-do list with gusto and not quit until the job is done.
You have to be ready and willing to make your own decisions to move forward in whatever fashion best supports your overall goals. It’s often said that any decision is better than no decision, so you have to be prepared to take action even if you have no idea what that action should be. Ideally, you’ll have the ability to educate yourself first, but some choices need to be made at a moment’s notice, not allowing any time for you to investigate your options.
If you don’t feel like you can take on this sort of self-motivation or handle this type of pressure to be decisive when it calls for it, you may not be ready to enter the world of becoming a self-professed business owner.
Is your family supportive?
While you can create a successful business without the support of those around you, it sure is a lot harder. Going through the process of trying to turn nothing into something can be extremely daunting and hard on you mentally and emotionally. Sometimes it’s the strength of your personal network that is the only thing that saves you and helps you through your days.
Not to mention that your family will likely be sacrificing right there with you. They’ll feel it financially. They’ll lose their time with you as you spend more hours than ever just to try to get your vision to take flight. And, the more on board they are, the less you’ll feel guilty about not being there for them the way you’d like because you know that they understand and are there with you every step of the way.
Talk it over with the people closest to you prior to taking the next step. Make sure they understand what you’re all up against as you go through the process. Be very realistic with them. If you try to sugar coat it, you’ll likely end up with those close to you being angry and resentful because you didn’t tell it like it is.
Let them know how important their support is to you. The more they feel like part of the process, the more they’ll be cheering for you to make your business a success.
What is your plan?
You need a business plan so that you know exactly where your business is headed and exactly how to get there. Sure, it may change as you go along the process (it’s almost a certainty), but you can’t walk into this having no idea how to make this work. As the old saying goes, “Fail to plan and plan to fail.”
According to Forbes.com, there are a few things that every business plan must have. They include:
- Having a thorough, yet brief summary of your business. What problem do you solve? Why should people buy from you? How are you going to make money?
- Knowing who your target market is. Who specifically are you selling to? What part of the population would benefit most from your product or service?
- Creating an accurate assessment of your competition. Know who you’re up against; who you have to outsell. How are they better than you? Worse than you? What will you offer customers that they can’t, or don’t?
- Defining your team. Who do you need to bring into your business to make it a success? What qualities must they possess? What will their role be?
- Coming up with a proposed business model. This is the part that most people think of when they actually think of a business plan. How do you intend to market yourself? How much money will that cost? How much are you going to charge? What will the overhead be? How much do you need to make to be profitable?
If you’ve done all of these things and you’re satisfied that you’re ready to venture into self-employment, then congratulations. You could be in line to be on a future cover of Inc magazine.
However, if not, that’s okay too. It’s better to know beforehand than it is to find out once it’s too late.