There are many reasons for wanting to become an entrepreneur.
Much has been written about entrepreneurship. It can be exciting, fulfilling, and even a path to untold wealth. But not if you lack one essential ingredient: a marketable skill.
You MUST offer something for which people are willing to pay their hard-earned money. Almost everything becomes an opportunity. Lawn & yard maintenance. Hauling away unwanted items. Protection, (body guard), services. Carpentry/Handyman work. Painting. Design advice. Yoga, martial arts, or physical training. Website design. Tutoring. Window Washing, Etc.
Know if you are a niche business or a scalable concept. Your friends or relatives may encourage your venture, but there may not be suitable market size that wants your concept. In other words, know your potential limitations to making money. Be realistic and honest with yourself. Yours may forever be a small, home business. Or, your idea may warrant the higher costs of buying into a physical, (bricks and mortar), location that customers can visit. Be careful to avoid investing too much, too soon. Being too enthusiastic, too passionate, too focused, too soon can result in bankruptcy. The safest route is to start small and locally. Then, over time, as your reputation builds, let customer demand almost literally PULL YOU into expanding.
Get the word out. You can spend time knocking on doors. Pay for direct mail brochures. Buy spots on radio/TV. Ask every friend and relative to spread the word to help you get started. And ask every customer to do the same.
There are a number of ways to go into entrepreneurship. You can go it alone, or you can save time by investing a large sum of money–$300,000 or more– into a franchise.
Other than an investment into a fanchise, where they have strict location and facility requirements, if you are picking a location, you must balance the cost of a location with the visibility of that location. It is often better, from a financial management perspective, to find a location that is not too much out of the way, but easily affordable. After you are swimming in profits, consider a newer location that offers higher visibility to traffic foot and automobile traffic…with great parking facilities nearby.
Give sufficient thought to your CASH situation. Don’t be too eager to spend your cash on elements you think are useful, that, in reality, will have almost not impact to pulling in more customers. Make every dollar you spend have meaning and impact towards building more success. Calculate EVERYTHING to the penny. Whatever you spend money on is considered to be burning money. In finance they apply the term, “Burn Rate”, to describe the money you spend each month.
Know what your bun rate is in advance of committing to an investment so you can calculate how long you can survive. You must survive until the business becomes a self-fulfilling business that brings in much more cash than what you spend. Divide your startup cash by your monthly burn rate to learn how long you can afford to be in business if your concept does not adequately connect with your customers. If you will run out of cash before you can become well established, then you need to think of a different concept for your business.
Hard work usually pays off, but not always. Some business concepts simply can not be muscled into being successful. Or, the personal costs may be too high. Be willing to face the “music”. A website designer, whom I know well, had a low-cost website design service that was in high demand. After several years of spending the best of outdoor days and nights locked away doing coding for his clients, the long hours became too much for him. Rather than raising his fees and making more money with fewer clients, he closed his business. His rationale? “I’d still be locked away doing coding while missing time with my family and missing the enjoyment of all my outdoor activities…” In his instance, his successful business concept was not a good long-term fit with his personal goals.
Now comes the MOST IMPORTANT of all tips: be willing to throw in the towel if your concept isn’t working. Don’t wait to go bankrupt. It is always better to cut your losses as soon as possible to save whatever money you can save. The longer you wait to make this decision the more you descend into financial pain.
Stay squeaky-clean when it comes to meeting all local business regulations, licensing, and especially for record keeping for taxes.
What’s the best way to start your own entrepreneurship?
If you have a job, start after hours and do so with one or two, or an easily manageable number of clients..provided there are no conflicts with your company’s employment contract. Start small and let the demand for your business pull you…literally pull you…away from your current job. You will know when you reach this moment because you’ll admit to yourself, or family, “There is so much demand that I just can’t keep handle what amounts to two full-time jobs.”
If you are currently unemployed, the best way to start an entrepreneurship is to do so with the least amount of cash possible and a mind set that it will take a lot of had wok to find your first few customers. Don’t invest in expensive marketing tools at this point. No need to have a $5,000 do-it-yourself website, or a custom-designed #40,000 website, or brochures, etc. At most, spend a few dollars on business cards to hand out when calling door-to-door. Don’t waste your business cards by leaving them tucked into door frames when you receive no answer to your door knock.
People like to help people. During your first few solicitations, don’t be ashamed to admit to your prospective customer that you are just beginning your new business. Be prepared to offer your first 100, or so, clients a reduced rate if they promise to spread their satisfaction by word-of-mouth to their friends and relatives.
Legwork: the benefits.
In the section above, I mention knocking on doors. If your concept has anything to do with property or the exterior of the home, walking a neighborhood in search of potential customers offers some advantages. You can see properties or homes that have a need for your service. If your service is something you offer inside the home, you may be able to provide a rough estimate of costs on the spot and get a commitment for your service right then and there.
An Example of a Successful Entrepreneurship
When I answered the knock at our door, there was a young man grinning ear-to-ear offering a window washing service, something I normally do myself. At that time we had lots of family matters spinning around us and I felt pressed for time. I agreed to hire his service for that first summer. A few weeks later a crew of three workers converged upon the exterior windows of our house. A ladder went up to the second-floor windows. I watched as they practised good safety and good care of the roof and windows. In a matter of about 90 minutes the crew had done that which would have taken me almost an entire day. I was very happy with everything, from attitudes to work ethic, and especially the results. This is now an annual event for our home.
What Business Concept is the Right One for You?
…the one that you can do well.