There are many things to consider when starting a new business, but the first question you should ask yourself is: “Am I a good candidate to own a small business?” While anyone can start a small business, it takes a special type of person to build a successful business. Here are a few qualities and skills that are a must in any entrepreneur:
There are many aspects to starting and running a business. A successful entrepreneur is organized and skilled in planning. Starting a home-based business can present very unique challenges, even the most organized person may get overwhelmed occasionally when faced with the challenges of starting and running a successful business while balancing work and home life.
Time management is also a very helpful skill when running a home based business. The ability to make a plan and stick to it in a timely manner can make running a small business effectively and successfully much easier.
One major reason people want to “be the boss” and own their own company is so they can set the hours they work. This is both a pro and con of small business ownership, which we will discuss later in this chapter. Being the boss does mean you get to set the hours, but it can be a double-edged sword.
The boss decides what hours the business will operate, and decides when he or she will work. This means there is no one to account to. It also means there is no one else to make sure things get done. It takes a disciplined, self-motivated individual to be able to stay focused and make the hard decisions that can make a difference between success and failure.
a. Do you hit the snooze button on the alarm and sneak an extra hour of sleep, or do you get up and prepare the large order that needs to be shipped by noon?
b. Do you take your kids to the beach for the day or do you stay home and write a newsletter announcing new products to send out to your customers?
These are two simplistic examples of decisions and challenges you will face each and every day. Procrastination can be a small business owner’s worst enemy.
It is likely that the first thing that popped into your head when you saw the title financial responsibility is, “anyone knows that you have to be financially responsible to run any kind of business.” That is true, and it was not my intention to state the obvious here. In fact, I didn’t. The type of financial responsibility I am going to discuss here has less to do with how you run your business and more with how you run your personal finances.
Starting any type of business is a serious and major undertaking. It often takes a moderate amount of capital to get started and the returns can be slow going at first. Everyone would like to think that once they start their business the money is going to start rolling in and they will be millionaires overnight. That is an awesome dream, but the reality is that it takes a lot of work to build a business. It takes a little while to build up a customer base, and even once you do, there will always be slow times.
One small business owner told me, “A lot of the time when we were starting out it was either feast or famine. One month we may be eating steaks and the next it was ramen noodles and praying we could keep the electricity on. Now, after twenty years we still have those months, we just learned to use the good times to save up to get us through the not-so-busy times.”
When you’re used to a steady paycheck coming in every week it can be a bit of a shock when the money takes a bit longer to come in, and when it does, it may come in smaller amounts that you are used to, at least at first. Even after your business takes off and is doing well there can be slow times for many different reasons. Seasonal buying, economy shifts and competitor’s sales are all factors that can cause fluctuations in business, and as a result in your personal income. The key to success is planning ahead and being prepared. Being financially responsible in the more profitable times can get you through the slower times.
Entrepreneurship is not for the squeamish or shy. As a business owner you have to be your own best sales person. You may be thinking, “My business is going to be online, so I don’t really have to sell anything, I just put it up and it will sell itself.” It would be wonderful if it worked out that way, but unfortunately it usually doesn’t. While your website and advertising will do a lot of the work, there are many areas where a personal touch is needed.
For example, raising capital to start or expand your business. When you go to a bank or other lender to get funding you are the “face” of your company and you have to be able to sell yourself, your business and your products. Lenders won’t give you money if they feel you aren’t sure of your ability to make your business successful and profitable.
A confident attitude and trust in your own abilities as a business person will also help you get through those lean times I talked about earlier in the chapter. Confidence in yourself will help you put on that “salesperson smile” and get and keep customers.
Change is the only true constant in business. A successful small business owner must be able to deal with constant change. There are large, ambiguous changes such as economy fluctuations and technological advances which come around occasionally and can change the way you do business. There are also many more changes, some expected, and some not that can happen on a daily basis. For example, one morning you may go into your office, turn on your computer open your email and find a letter from your largest supplier stating that they are closing. This problem (we will discuss problem solving in a moment) could change many aspects of your business including the products you have available to your customers. This could be a very frustrating situation. The ability to “roll with the punches,” so to speak, and accept changes you can’t avoid and move on to solving problems is one of the more important qualities needed in a business person. This brings us to the final, and possibly most important, quality a business owner must have.
You are the boss. This means you make the rules. It also means that when something goes wrong, there is no one else to go to. The buck stops here, so to speak. To use the previous scenario for example, if the supplier you get most your products from is going out of business there is no one to call for advice. No one else to tell you what you should do. It is up to you to come up with a plan to find a new supplier and keep your customers happy. For another example, let’s say you go into your office to turn your compute r on, but it doesn’t turn on. All of your records are on that computer and you have orders that need to be assembled and shipped out. This is a situation that could easily provoke panic. A successful business owner must be able to keep a cool head in the face of problems and be able to think creatively to solve them.
These are just a few things to think about before taking the plunge into small business ownership. Being the boss has its good points and bad points. It is important to go into any venture with your eyes open to all of the bad points. If you have all or most of the qualities listed, you should do just fine.