ImageSo you've been thinking about starting your own business. Perhaps it's been a long term goal of yours, or just an idea that came to you recently. Either way, there's some information you should consider before taking any further steps. Take a few minutes to self reflect. Ask yourself, "What am I good at? What are my talents?" Next, ask yourself, "What am I bad at? What are my weaknesses?" As you evaluate, be honest - if you're not honest you're only doing a disservice to yourself. Try to figure out what your true talents are, and don't be afraid to discover a weakness - you may be surprised with what you find. Successful business owners must understand that they have both strengths and weaknesses. It's important to build your business around your strengths and compensate for areas where your skills aren't as strong.
Essential Qualities for a Business Owner:
- You must be willing to make sacrifices - this includes money, time and vacation.
- Strong leadership skills - you need to be able to "show them the way."
- Strong interpersonal skills - must be able to work will all types of people; no room for miscommunication.
- Strong organizational skills - you're going to have a lot to keep track of.
- Management ability - managing relationships is not only important for dealing with employees, but for networking with business associates as well.
- Intelligence - Book smarts will only get you so far. To be a business owner you need a combination of street smarts and common sense.
- Optimism - You will run into walls, and face difficult times - a successful business owner has the vision to find their way around any walls.
- Business experience - Investors generally like to know you have some experience when lending money.
Now that we've evaluated the essential qualities needed to thrive as a business owner, let's have a look at what benefits come with owning a business.
Pros of Owning a Business:
- Be your own boss - make decisions
- Chance to make a lot of money
- You can't get fired - job security
- Work in a field you enjoy
- Put your ideas into practice
- Provide stability for your family
- Work directly with customers
- Build retirement value - maybe sell the business
- Benefit the local economy
Sure, there's a lot of money to be made, but there's just as much, if not more, risk that comes with it. Without risk, there is no reward. So let's look at the potential downfalls of owning your own business.
Cons of Owning a Business:
- You take a large financial risk
- You may work long hours with no vacation time
- May not have steady income
- May spend more time on details than you care to
- May have unpleasant tasks - firing employees, not hiring friends
- You're going to have to learn all the disciplines of business, including: bookkeeping, filing, planning, advertising, and promotion
- The business owner takes on a wide variety of roles - market research, business planner, manager/boss, tax collector, marketing/advertising executive, etc.
Important Questions to Answer Before Starting the Business:
Now that you understand what it takes to be a successful business owner you must take 10-15 minutes to thoroughly answer the following questions. Open up MS Word, or whatever text editor you use, and answer the following questions in 3-5 sentences.
- Why do I want to own my own business?
- What areas would I enjoy doing business in and why?
- What strengths do I have to offer?
- What are my weaknesses?
- How will I overcome those weaknesses?
- What business type seems right for me and why? (startup, pre-existing business, franchise)
- Where will I get my financing from?
- What sacrifices will I make for this venture?
The answers to these questions will lay the foundation for your success as an entrepreneur - if you can't answer them easily you might have problems starting a business. Now that you're aware of both your talents and weaknesses, look for business opportunities that highlight your talents.