Find out what it takes
Running your own business is very rewarding but it can also be risky.
You need to make sure you understand all the challenges because it is not enough just to have a good, viable idea – you also need to have adequate resources and the right skills and temperament to make a success of the opportunity.
Assess your abilities and resources
Whatever your personal starting point, there are some fundamental issues you need to assess relating to your business idea, your personal aims and your own business ability.
- Do you have the necessary capital and financial resources to start your business, to finance the purchase of any stock and equipment and to pay your general living expenses while you go through the start-up phase?
- Can you afford, and do you really want, to risk these resources? For example, you might have to take out a secured loan based on the value of your home – consider the consequences of your business failing and being forced to sell your house.
- Do you have the commitment and self discipline to get through potential hard times? There may be times when customer demands are particularly heavy and it will be up to you to make sure these demands are met. How will you cope with this and are you prepared to put in the necessary hours to meet the demands of your business?
- Are you confident that you will be able to negotiate with suppliers to get the best deal; that you will be available and helpful to customers at all times and can think clearly under pressure and take criticism without getting upset?
- Have you considered the level of demand your product or service may generate and will you be able to deal with fluctuating demand?
- Do you have the determination the carry on when demand and sales are low?
Characteristics of a successful entrepreneur.
There is no single 'type' of entrepreneur but there are some characteristics that successful ones tend to have in common such as:
- gets things done
- good with customers
- able to get their point across (to staff, suppliers, financiers)
- sociable with the ability to show leadership
- single minded, but able to take advice
- flexible and adaptable
- quick to take opportunities (and ready to take calculated risks)
- hard working, committed and determined
- tough-skinned and able to handle failure
- creative, imaginative and always coming up with new ideas for the business.
Skills and qualifications
Customers and lending institutions may be more comfortable if you have the right qualifications. For certain businesses you are actually required to have specialist qualifications or accreditation with trade associations.
Business skills are essential if you do not already have them. It is important to understand the principles of running and managing a business, including marketing, strategic planning, accounts, personnel management and so on.
If you expect the business to grow, you will inevitably have to employ people and your leadership and management skills will be vital. Many promising enterprises fail to grow because their owners do not have these skills.