Self-employment can be a rewarding career move, but taking a leap into the unknown world of entrepreneurship can be fraught with personal and professional challenges.
Many of us dream of starting a business and working for ourselves, but how do you know when you’re really ready to be your own boss? Here are some of the factors you should consider before giving up your day job and that steady pay cheque.
1. You’re ready to manage the day-to-day tasks
You often hear entrepreneurs say during the early days they packed boxes, paid bills and connected computers. It’s true that everything from managing finances to hiring and firing employees can fall on your plate within the first few weeks, months and even years of starting a business. You need to be prepared to wear all the hats at any given moment.
2. You have a financial buffer
Starting your own business comes with unexpected costs and you may be a long lag time before you get paid. Depending on the scale and size of your business, it’s best to wait to hand in your resignation to your current employer until you have enough in the bank to pay six months’ worth of bills and living expenses.
3. You accept responsibility
Many people like to pass the baton on menial and difficult tasks when they’re working at a larger company, but when you’re a boss, you’re held accountable whether you have a team of employees or not. If a deadline is not met, if legal issues arise, if your office lease isn’t renewed or you fail to meet a client’s or customer’s expectations, the buck ultimately stops with you and your business will be affected.
4. You understand that you will be working harder than ever
Although some people believe working for yourself will guarantee shorter days because you’re the boss, this is often not the case. Start-ups require long hours that may impact personal time with your family and friends. You need to be prepared to sacrifice your downtime in the short-term to achieve success.
5. You’ve researched the market and competitors
More than 60 percent of small businesses in Australia close within their first three years, according to the Australian Bureau of Statistics. Research and planning are integral to the success of a business. Ensure you have done your homework on the marketplace and your current or potential competitors. Ask yourself: How does my business differ from competitors? Why will customers choose us over them? Is there change occurring in the industry that could affect the business?
6. You’re passionate about your new business
There’s no point in launching a new business if your heart isn’t in it. Being passionate about what you do will keep your motivation levels high even in the tough times. Make sure you’re going into business for the right reasons, not just because you want to make more money.
7. You’re willing to learn and grow
Be ready to learn, grow and evolve. Within the first 12 months of starting a business, most owners will tell you they how much they have learned. Accepting that creating a new business is a learning curve and absorbing as much information as possible will help you improve and work smarter.
Sheree Mutton is a freelance journalist and the Founder and Managing Director of media agency, Reeton Media, which specialises in content marketing and creation, communications; and copywriting. She has written for The Australian Women’s Weekly, The Sydney Morning Herald, news.com.au and more.