Is a Start-Up Business For You?

Critical to the success of your start-up business is careful pre-planning and visualization of what the business will look like. But before you focus on the business you want to start, take a careful look at (1) your motivations for starting the business, (2) your likes and dislikes , (3) your capacity for hard work and your endurance , and (4) your credit and financial picture .

Your Motivations to Start a Business

In a sense, launching a start-up business because you have been laid off from your job and need money may be the worst of motivations, unless it is a lifestyle that you’ve dreamed about and one that is your passion. If you have been laid off or fired from your job and need money, perhaps you should focus all of your attention and energy on finding a new job: hone your resume and job interview skills. As we mention elsewhere, an exception to this rule is the older worker who finds himself or herself in that terrible place of being too young to retire and too old to get hired. If you have sent out hundreds of resumes and you have not gotten a bite, much less a job, definitely consider launching a start-up business.

Your Likes and Dislikes

When thinking about a start-up business, carefully consider your likes and dislikes, although this can be a tough process. For example, you may be an engineer by profession, but you think you would love to start a landscaping business. Perhaps you have come to hate engineering, but love to get your hands dirty working in the soil, selecting plants, and creating a beautiful environment. It’s really your choice: you could probably get a consulting engineering practice up and running a lot more quickly than a landscaping business. With the money you make from your new consulting business you could buy a larger house and piece of land and then, as a hobbyist, you could landscape to your heart’s desire. If you want to drop engineering for landscaping, you will start the business and struggle to get customers with really no track record to highlight, and you will be competing against companies who have been in the business for a long time. It is a tough nut to crack, but it is your choice.

Your Capacity for Hard Work and Your Endurance

A start-up business typically requires hard work, endurance, disappointments, fear and probably any other emotion you can think of. Every now and then someone comes up with a smart idea that clicks overnight. He or she has a unique new product they put on a website, the concept goes viral and their fledgling company is filled with orders. We hope that happens to you. Chances are, it will be a different story. You likely will have a learning curve to climb and setbacks and you will make mistakes, some of them will be costly. But hopefully, you will learn from your mistakes and slowly, surely your business growths and thrives. Getting from point A (launching the start up business) to point B (success at last!) is a rough road. Do you have what it takes? Are you sure?

Your Finances or Where the Rubber Meets the Road

All the things mentioned above are nothing compared to your financial and credit condition. Through the last few years of deep recession, many, many good people have been hammered by the economy. They have little or no money and their credit rating is in tatters. If this is your situation, this may not be the best time to start a business. Bankers, prospective vendors, prospective clients and customers will look at your financial records. To borrow money, hard-nosed bankers want to know two things about you: are you the kind of person who will pay them back their money they lend you and in a timely fashion as agreed? The prospective vendor wants to know the same things: will this person pay me for the products or services I deliver and in a timely fashion? The customer wants to know many, many things but a key thing is will this person be able to deliver his or her services as promised?

Ask Yourself These Questions

Ask yourself the following questions and answer them as honestly as you can. Then check out other pages in this pre-start-up section for more information on credit, business ideas, and more.

  1. Why do you want to start a business of your own? Are you a self-starter? Can you motivate yourself and work on your own?
  2. Are you willing to start a small business and be a jack of all trades in your new business, at least at first?
  3. Do you need to make a few repairs on your credit report and credit score?
  4. What is the best start-up business for you?
  5. What does your personal credit report and credit score look like right now?
  6. Do you know the steps to take on how to launch a start a business?
  7. What are the benefits and drawbacks of starting a business for you? Do the benefits outweigh the drawbacks?
  8. Would you be better off undertaking a business part time and working into it full time?
  9. If you start this business part time while working for someone else, are there any legal issues that could hurt you down the road? Did you sign a non-compete agreement with your employer?
  10. Do you have a knowledgeable person to speak with about your business idea? Is there anyone to speak with on an ongoing basis, perhaps a relative or friend in their own small business?
  11. Do you have the basic skills do you need to run a small business or a home based business?
  12. What small business or small home based business should you choose? How long will it take to start up your business? What if it takes longer? Can you survive financially?
  13. Do you know the benefits of buying a franchised business to start?
  14. Pre-planning your business.
  15. Should you buy an existing small business?
  16. What is the marketing potential for your business idea? If you do not know, how can you find out before taking the plunge?
  17. What do you need to be a successful entrepreneur?
  18. Are you adept at technology and business software or is all of that foreign to you?
  19. What are your biggest hurdles to starting a small business? Can you overcome them?
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