Hello Work Well friends!
This is the second post in our series, Work Well Blog Series: Starting your own small, service-based business. #startitup
#startitup No.1 / Work Well Blog Series: Starting your own small, service-based business.
#startitup No. 2 / Do your homework. Vetting an idea and planning for the future.
#startitup No. 3 / Signed, sealed and delivered. Forming an official business. Coming soon!
#startitup No. 4 / Get organized. Building a solid foundation. Coming soon!
#startitup No. 5 / Branding basics. Identity essentials. Coming soon!
#startitup No. 6 / Get social. Social Media Planning. Coming soon!
#startitup No. 7 / Clients and customers. Get your audience. Coming soon!
Today's post is entitled #startitup No. 2 / Do your homework. In this post we're going to focus on vetting a small business idea and planning for the future to make it a success.
People start their own small businesses for a variety of reasons. And in this day and age, with the number of businesses out there, to be successful you have to be prepared, i.e. do your homework.
So now that you've realized you want to create your own business, it's a great time to really examine some important things that will help you plan accordingly. Here are some questions that I've gathered to ask yourself, that really help to get the process going.
Why do you want to go out on your own? You might feel like you no longer a fit in your corporate environment. Maybe you want to be in charge of all work-related decisions. See a market need that hasn't been filled yet. Really examine what's at the root of your desire to be your own boss. Once compiled, ask yourself - is this a fair, valid, and sustainable reason?
Why do you think you'll be successful as your own boss? List the traits you feel will contribute to your success. And don't be afraid to enlist the opinions of others. Many of us have a bit distorted view of ourselves, so gathering the opinions of those you trust is valuable. Write them down and keep them somewhere you can refer to (I keep mine as notes in my iPhone). Why? At some point you might need a reminder of those great attributes to help you get unstuck or give you the added support you might need down the road.
What are some behaviors of yours that may make going out on your own a challenge? Be honest. Say, you're a awesome at starting things, but not so great at finishing them. Maybe you hate paperwork. Or can't stand sales. The more you address these items now, the easier it will be to plan accordingly. You can earmark these “challenges” as arenas you will enlist help with, i.e. delegate, to ensure your own personality traits don't sabotage your success. And don't feel like this is the perfect time to start changing these traits, either. With so much change going on, it could very well overwhelm you. Better to shoot straight and plan accordingly.
How is your health? It may not seem important, but it is. The process of starting your own business can be stressful. If you currently have a health condition or are in the midst of another stressful situation, it may be best for you to focus on a self-care plan or resolving any current conflicts to bring you into a state of stable, solid health. There's also the possibility that starting your own business is the self-care you need to get you out of an unhealthy environment. Either way, take note of health and consider how starting your own business will affect it.
What is your support network like? A support network - be it personal or business circles - are important. Having people to call when you feel lost, frustrated, overwhelmed, or even want to share your successes are paramount. Even thought you're going out on your own, you won't feel alone, because you'll be surrounded yourself with like-minded and positive influences that will increase your resiliency, and long-term success. If you feel yours might be a bit in need of augmentation, feel free to look into joining local meet-ups or engaging in local business chapters in your industry to give yourself an added boost.
What are you current commitments in life? Really take a close look here. Who needs you? Your significant other? Kids? Aging family members? Community? Looking at your relationships and the expectations of those around you will really give you a sense of available bandwidth to venture out on your own. Upon reflecting, it's a perfect time to reaffirm your personal priorities, and in arenas that might require freeing up, start some conversations.
What services will you offer to your customers? Define your services as clearly as possible. It's also a perfect time to create an “elevator pitch” - or description of you, your company and your services in 30 seconds.
How will you provide your services, i.e. in-person, remotely, etc.? The method in which you provide your services helps to further define your business and address any service or equipment you may need. It also will help you understand how you will be using your time; in the car, on a computer, etc.
Who will be your competitors? Know your market. Do some research. Be a secret shopper. Performing an audit of who you are comparable to will help you further understand your business and opportunities for market share. By understanding them, you can - with confidence - create a plan of differentiation that will help with the marketing and sales of your services.
What tools, services and equipment will you need to operate? A Computer. Phone. Business cards. Website. Accounting software. Project management platform. Office space. And so forth. Make a list. This is also a great opportunity to discover what you will potentially be able to write-off. (Always be sure to confirm with your accountant, though, as the IRS is continuously making changes to acceptable and unacceptable arenas.) Sit tight, though, in a future post - I'll share my favorite (and affordable) tools for getting going.
How do you plan on connecting with customers? This is the make it or break it moment. Finding and reaching your customers to purchase your services will make you successful. By knowing your customers - their demographics, likes, dislikes, avenues to reach them, etc. - you can get off the ground a lot easier.
What does it cost for you to live on? Download those bank statements and make a personal budget.
Do you have a business budget? There are a number of tools out there, but I happen to like Business Owners Idea Cafe's budget. It's not the prettiest tool, but automatic.
Do you have funds set aside to help you get started? Now you know what you need to get started. Is it in the bank? If not, you can consider a number of things: 1) Raising the funds yourself, 2) Borrowing Money as a Personal Loan, or 3) Getting a Business Loan. Service businesses are typically low-entry, with regards to overhead, so I find they lie in #1 or #2. If you plan on a large service model, to obtain a business loan, you've got some work to do. I really like this article in Forbes, on the 7 Steps to Getting a Business Loan. Either way, now you know what's in (or missing) from the piggy bank.
Are you prepared to jump into self-employment, or need a transition strategy? Finances usually play a part in this one. Have six to twelve months of living expenses saved, operational start-up costs covered, and excitement to fuel the next two years? Go for it. If not, maybe continuing to work at your full-time job while researching, organizing, and beginning to soft-sell your services may be the way to go. Either way, examine what the best circumstances would be to help augment the starting success of your business. I typically advise against the big leap, only because the added stress of the jump can sometimes affect the quality of your product, organization, and personal health. But then again, I know there are those of you out there that need live off the adrenaline, so good luck to you my warrior friends.
How much time will you commit to this process? The planning process is rather time-consuming, but imperative. Doing your homework to build a strong foundation is the cornerstone to your success, so be sure to allot the proper amount of time to do it right. As such, it can take you away from other things in your life, so be sensitive to that fact. And if you find that it's a pain in the butt and you just want somewhere else to do it, that's where I come in. Drop me a note.
Do you have a timeframe and an exit strategy? People often hate this question. But I find, for those that set mental thresholds for performance that tie to a timeline and have a fallback strategy, are more strategic. They've set the mental framework for the business to lie within, and if certain parameters don't meet their performance goals, they've got a flexible transition plan. Hence, low drama.
I typically find that with these considerations, you really get a sense of whether it's time to pull the trigger, or time to do some more self-reflection and get back to the drawing board. If you get to the end of these questions and feel confident you're in the right place, congratulations! Our next post #startitup No. 3 / Signed, sealed and delivered, about forming an official business will be right up your ally.
I'll be dropping posts every week and announcing them on Work Well's social media pages - Facebook, Twitter, LinkedIn, and Google+ - so be sure to follow us on your favorite platform. Of course, you can always just check out website (www.weworkwell.co), too.
As with all Work Well posts, their intent is to help start a conversation and point you in the right direction. If you require any additional help, have feedback or just want to connect - feel free to comment on a post or contact me. Let's get a conversation going.
Work well, be well my friends -