Small Business 101 – Things to Consider First

In the last several months, I’ve asked and answered many questions about becoming a small business owner. There are a million and one articles out there for tech-based or “big” small businesses, but I’ve had a tough time finding good lessons for those of us that are looking for a “lifestyle” business, not to be the next great American billionaire. So with that said, I’m going to throw out a post now and then about issues that have arisen for me. Hopefully, I’m paying this forward and you’ll return the favor when you get a chance. We can all learn from each other!

Today we’re going to talk about things to consider before leaving your steady, corporate job. There are a great many things that are specific to industry (liscensing, finding loans, etc.). I’m going to focus on the true basics on the assumption you’ll find analytical data elsewhere. I’m assuming you have a good idea, a rough business plan, enough sales to prove that you’re on to something, and a savings account that includes money to pay the bills for at least 6 months.

Here are a few questions for you to mull over:

1. Can you work for yourself?

Are you self-motivated or do you need someone else to tell you what to do? Will your time management skills work without the constraints of office hours? If you plan on working from your home, will you have the discipline to keep separate work time vs. play time? Will the call of soap operas, the laundry pile, or a comfy bed perfect for a nap be too strong for you to ignore?

2. Can you work by yourself?

Yes, this is a totally different question. I like being by myself, but I also like people. A lot. One of my biggest pet peeves in my corporate positions was all the time lost to people ducking into my office, but boy, do I miss that distraction. I use Facebook and other social media to give me some daily interaction with folks, but there are some days that my husband can tell I’ve been in the basement studio a bit too long when I just won’t stop talking the second he walks in the door.

I make a point to have a reason to leave the house at least three work days a week. At least two of those need to require make-up and “real clothes” (i.e. not just going to the gym…I may be around people there, but I don’t talk to anyone when I workout.) Coffee and lunch dates will become your new friend.

3. Are you comfortable as a salesperson?

You might be the best widget-maker in the history of widgets, but now you’ve got to sell your widgets. Gulp. If terrorists ever want to get me to tell them all the secrets of the world, all they have to do is otherwise force me to make cold calls. Nothing is more terrifying to me! Out of all the things I’ve had to learn in being my own boss, this skill was probably the hardest. I still don’t think I’m great at it, but I have found ways that make the process more comfortable.

If you have a product people will want, you need to find the right words and let social media and word-of-mouth do the majority of the work for you. Work hard to get good recommendations and use them whenever possible. Particularly when you are just starting out, you need proof you’ve done (good) work for others already.

4. Do you have a network?

When you remove the structure of a corporate environment your networks will become your life line. You’ll need a professional network that knows your industry, the skills you don’t have (graphic design, finance, marketing ,etc.), and/or the people you really need to know. LinkedIn is the best way to meet people from your home office, but you should set aside money to attend industry events and educational sessions as well. I’m still a firm believer that a live meeting is always better than electronic. If nothing else, it’s harder to ignore you when you’re standing right in their face.

You also need a personal network that supports your good days and your bad days. These people should know your strengths and hold a strong enough place in your heart that they can discuss your weaknesses without you becoming offended. While I’ve found that my friends and family have had a tough time comprehending why I would want to make such a scary move, they have been the best cheerleaders I could hope for! Make sure you have at least one person who won’t try to talk you out of it when you’re feeling like this may not work. There will be plenty of those days, but you are moving forward, I promise!

Both groups should provide motivation and allow you an opportunity to brainstorm ideas as you would if you had coworkers.

5. Are you prepared to do it all whenever the need arises?

As a small business owner, you are the CEO, the lead salesperson, the web site designer, the accountant, the receptionist, manufacturing manager, logistics director, and probably the janitor. Without anyone else to turn to, you may need to work on Saturdays to get the job done or take the appointment with the customer that conflicts with your weekly dinner date with your wife. Moral of the story – are your prepared to make your business your priority and your life for the near future?

I take lots of time during the traditional work week to do my own thing. Grocery shopping at 9am on Mondays is spectacularly fast without the crowds. The classes offered at the gym during the 10am hour are some of their best. But more often than not, I find myself still here in my studio at 9pm at night. And even if I’m not here, I am always thinking about what I need to do next. I’m a big list maker, so I keep a weekly calendar of tasks. As an example of what a typical day looks like, here’s my list for June 5th.

Sure, there are some specifics to my line of work on this list, but yours will be equally crazy, particularly when you are starting out and can’t afford to let the professionals do their job. (Another life lesson – let professionals do the work !!)

6. Can you afford to do this?

Obviously, money is one of the biggest concerns when thinking about starting your own business. Even if all signs point to success, you are probably not going to get back to your corporate salary for some time. Can you live with a lifestyle that may be less than you are accustomed to? If you are fortunate enough to have a significant other or family member that can support you while you launch your business, be very careful with this relationship. This person now has a lot of pressure on them to keep the lights on while you “live your dream life”. No, I don’t think the first six months are anyone’s “dream life”, but to someone going in to work long hours for The Man, it sure could look that way. Be sure to always keep an open line of communication open to ensure you both are comfortable with the situation. Even though my husband and I brush past the topic often, I have made a conscious effort to bring up this specific conversation at least once a month.

Also, keep in mind that you aren’t just losing the monthly money when you quit the corporate job. You also now will be responsible for medical insurance, disability insurance, and retirement savings. While you may start the new business before you get all of these items in place, you may want to have a written plan with a time frame to restore these benefits before you jump ship.

And lets not forget paid vacation days. Those are now just a thing of the past! Depending on the business, you may be working on holidays, let alone get paid to enjoy them with your family.

I just looked at my infamous to do list and realize I haven’t taken a completely work-free day since Monday, May 28th. Do as I say, not as I do and be sure you don’t burn yourself out!!

This post is scary, I know. There are lots of very valid concerns that you need to address before you consider this different way of life. Did I miss any?

If you are local to Waukesha, I highly suggest the FaSTart workshop put on by the staff of the Waukesha County Technical College. It’s under $20, but is priceless in the amount of information you learn!

That said, it’s pretty awesome. I love my life right now! Next time I do one of these posts, we’ll talk about all the great reasons to become your own boss!