Have you ever dreamed of being your own boss? Whether its because youre an out-of-work Boomer whos been downsized, youve retired and want to continue working because you need the money or youre just bored, or youre fed up with working for someone else, starting your own business just may be the right next step for you.
However, starting and running a business, especially if youve never done it before, could cost more money than you expect, take up more of your time than anticipated, and produced more stress than you could possibly imagine. Yet, at the end of the day, the satisfaction of running your own company and being on your own just might be worth it.
To help improve the outcome, here are ten steps to help you to start your business:
1. Be realistic about the pluses and minuses of having your own business.
Lets start by looking at the positives:
• More control over what you do, when you do it, and even where you do it.
• You can more closely match your interests and skills to the business you start.
• If the business does well, you can make a lot more money that you would have in most salaried positions.
• You are creating something that you can pass on to your family or an asset that can be sold.
As for the minuses:
• Most businesses will take some time from inception to bringing in any revenue. What will you or your family live on until the business is profitable?
• There are numerous tax, legal, accounting, and business issues related to running a business that you need to know.
• You need to protect your personal assets so if the business does not become profitable, you do not lose your house, cars, or other assets.
2. Decide if you have what it takes to start a business
Take this self-quiz to see if you have the personality and skill set to start a business. Answer yes, no, or sometimes to the following five questions:
1. Are you a self-starter?
2. Are you able to go after new customers and to work hard to keep the ones you get?
3. Do you have a fire in your belly that makes you feel so driven to start this company that you are determined to do whatever it takes to make your business a success?
4. Do you have a service, product, or idea that matches your skills with what it will take to make your business a success, or can you employ others who will help you meet that criteria?
5. Do you have enough money in the bank or access to investors or capital to fund your business and/or sustain it until it is up, running and profitable?
If you answered yes to all five questions, you are in a good place to consider launching a new business.
If you answered yes to the first three questions, and no to questions 4 and 5, you still have a good chance at success. Passion and determination are qualities that can catapult you to find funding sources for your new venture whereas lacking the entrepreneurial quality of being a self-starter is a deficiency that may be harder to make up in your quest to start a business.
3. Figure out what type of business you want to start
There are four of the basic ways of going into business:
• You can start a business from scratch
• You can buy someone elses business, along with their clients, customers, or products
• You can buy a franchise
• Or you can go into partnership with someone else so that the financial investment and the administrative aspects of running the business are shared.
Each of these options has its pros and cons. If you start from scratch, you have to develop brand and name recognition. If you buy an established franchise, the franchise will train you and you also will have brand recognition built in as well as a consistent product. But buying a franchise does not instantly mean your own business will be a success. (See Franchise Basics at www.entrepreneur.com, the online site related to the print magazine Entrepreneur.)
If you go into a partnership, you might be sharing the economic investments and even the work entailed in launching a business, but you are also no longer running the show completely on your own.
4. Do your market research to determine if there is a need for your business
Whether you are going to offer a service or sell a product, you first need to determine if there are clients or customers for your new business.Larry Stybel is a 62-year-old Boomer who 32 years ago founded a career management company, Stybel Peabody Lincolnshire, an Arbora Global Company with offices in 32 countries. He says a senior executive once told him that he never wanted to work for anyone else again, so he decided to start a restaurant. He decided to place it near a major corporations headquarters in Massachusetts since there were no restaurants nearby. He figured the tens of thousands of employees would go to his restaurant for breakfast and lunch.
What he had not researched was that this particular company was a loose lips sink ships type of corporation that strongly discouraged employees from ever venturing outside of the corporate headquarters during the workday so it offered a heavily subsidized corporate dining room. This was too much competition for the former executives new restaurant, and it failed.
As Stybel notes, your market research has to answer three questions:
1. Is this a product or service that is really needed?
2. Who is going to pay for it?
3. How much will they pay?
5. Name your business
Selecting a name is not as easy as it sounds. You need to make sure the name is not used by another company which could create confusion in the marketplace. You will want it to be memorable and unique yet not too difficult to spell or pronounce. You will probably need to register the name with the town hall in your community so you are a DBA (doing business as). You may also want to buy the Internet domain name, whether or not you immediately create a website for your company, so you own the name, not someone else or the competition.
6. What type of company will you be?
Decide on whether a solo practitioner, LLC, C-corporation, or S-corporation will work best for you. There are tax and businesses benefits and consequences to each of these business options. Seek out the counsel of a trusted legal advisor or tax accountant and discuss what the various options are; have your advisors guide you through the necessary paperwork for making your business one of those entities.
If necessary, you or your advisors will apply to the federal government for a Tax Identification Number (TIN) for your business. (See Apply for an Employer Identification Number (EIN) Online)
7. Learn what you need to know to run your business
Understand what your tax, accounting, clerical, and any legal considerations are for manufacturing products, selling goods or services, and/or keeping track of sales. Use SCORE, a free counseling service for new businesses or hire a small business consultant. Take a course or read books or articles on starting a business including information at www.entrepreneur.com.
At www.retiredbrains.com you will find information about starting a business including direct selling, freelancing, or selling online. One way to learn what you need to know to run your own business is to initially affiliate with a company that has a recognized training program and then, when you are ready, branch out on your own.
Nancy Anderson, author of Work With Passion in Midlife and Beyond, emphasizes that there is a learning curve that you have to deal with when you want to start your own business, especially if you have been working for someone else most of your life. Says California-based Anderson: Its very unrealistic to jump from a job to trying to run a business unless you have a tremendous amount of savings and a lot of capital. Instead, Anderson recommends that you take the time to get up to speed. She says, People dont realize how long it takes to get something up and running.
Anderson recommends giving yourself "at least 5 years before you know what youre doing.
That may be hard to hear, but thats about the time frame that covered Ben Olivas transformation from working for a major company, Sprint, as a sales representative to starting his own independent broker/owner real estate agency. In the interim, Ben Oliva, who is now 63, renewed the real estate license he had from years before. After he was downsized, he first went to work for Century 21, which is known for its excellent training program.
After a year, he went to work for another well known real estate franchise. In both instances, he was not on salary but paid on a commission only basis, but he did have the advantage of working for those companies with their well-known brands. After 4-1/2 years, Oliva felt he was ready to start his own real estate company, which he calls Family Tree Realty. Based in Mineola, Long Island, New York, Oliva is marketing his new company by leveraging that hes local and independent.
8. Do a business plan
Marty Zwilling helps startups by tweaking their business plans. Although Zwilling can certainly write a business plan from scratch, he encourages entrepreneurs to at least write the first draft themselves, as a way to better understand what their business is all about, including a projection of how much money someone needs to start and to launch that business.
In your business plan, you will want to work out who will run the company and where will it be housed: at home, in an office paid on an annual lease, or in a month-to-month office set up. Will most of the work be done by you or will you hire part-time, freelance, or fulltime employees?
9. Market your product
This step is crucial. How are you going to tell others that your business service or product exists? There are many books on marketing but here a few quick tips:
• Network through associations, such as the local Chamber of Commerce or the Rotary Club.
• Use print and online advertising
• If you can afford it, advertise on TV and radio. With the advent of local cable, television advertising has become less expensive than you may think. Check local cable companies for their rates. You can produce your own 30 second video of a couple hundred bucks and then by 30 seconds of time from local cable late at night for less than that.
• Think about PR, and publicity, and try for TV, cable, radio, and print interviews.
• Include online social media such as Twitter, Facebook, and blogging as part of your marketing plan.
Business plan and startup expert Marty Zwilllng is an excellent example of how you can market your product using social media. Yes, it takes time, and time is money, but as you become profitable you might want to delegate to others the writing of blogs and the posting of your tweets. But especially in the beginning, if money is in short supply, you can do it yourself. Thats how Zwilling, who is 64, grew his new business as a startup consultant and business plan writer.
Zwilling came out of retirement two years ago after working for such companies as IBM. During his retirement, he was already helping startups on a volunteer basis in his hometown of Fountain Hills, Arizona. But he wanted to get paid for his services. So he started a daily blog. He experimented with the various social media sites and he found that for him, and for his startup and business plan consultant/writing business, twitter had the best benefits. So he started tweeting regularly as well, about the topic but also highlighting information that he was blogging about in a more concerted way with a hot link to the blog.
In about fifteen months, he has grown the number of his followers on twitter to 197,636. Zwilling says, Entrepreneurs have to be hungry. They have to have a vision. They have to believe.
10. Getting paid and turning a profit
There is no substitute for hard work and of course a little bit of chance. But you can delegate some tasks and even rely on interns for credit to help with your new business. What you cannot delegate or manufacture is that enthusiasm for your business (or service or product).
Finally, you have to find a way to get paid for what you offer. Whether that means getting savvy at turning those who want your services for free into paying customers or clients to finding a way to collect the monies that are due you. If someone is ignoring your invoices or there is paperwork to be completed to get a payment, you may have to hire someone to do the bill collection for you.
When the going gets tough, always remember why you started your business. Thats what keeps Lori Reader of Melbourne, Florida going.
This Boomer started her business in 2008 inspired by her children. As the mother of four, Reader explains, I was torn each night as I put my children to bed when they were younger. Each one would beg for more time. Out of that feeling, Reader evolved the idea of Loveable Look-a-Like dolls. Buying blank dolls from China, Reader hot-presses a photo supplied by her customer on to the doll.
She also developed a kit that customers can use on their own so she could get her product into stores rather than just selling online. Shes not profitable yet even though shes sold hundreds of dolls so far because of the initial startup costs for buying the blank dolls, investing in a website, and paying for marketing, which she now does herself.
Would she do it all again? Shes ambivalent about that. On the one hand, she realizes how tough it is running your own business. On the other hand, she still has her passion.
I still believe in my product strongly, she says, and every day I try to come up with new creative ideas to sell it. One day it might turn a profit. In the meantime, her family relies on her husbands income. She still takes pride in the good her dolls are doing, such as the bereavement doll" for two little girls whose father died, the doll of her mother for one child who is in and out of the hospital and another of a parent who had just been deployed to the Middle East.
Whether you have enough funding to pay yourself a salary and cover operating costs, or if you have to take money out of your own pocket, starting your own business can be the next great business adventure in your life.
