|Have you got what it takes? Am I ready for business?
To start and run a business, it is not enough just to have a good, viable idea. You also need to have the right skills, attitude and personality to make the enterprise succeed. Here are some points to consider and some questions to answer that will help you to decide whether you are ready to start your own business.
Think about why you want to start your own business. There are many good reasons, but there is often the danger of having unrealistic expectations. Here are some reasons that people often give, and some notes of caution:
- I can't find a job: The very fact that you are reading this sheet means that you are an explorer of possibilities, and that, if you are persistent, you will make progress. If you have to do something to survive, by all means, start trading. Buying and selling things from home or at the streetside is the easiest form of survivalist trade, but it remains a very hard way of making a meagre living. Keep on reading about business and go for business training courses if you can. But unfortunately, your chances of growing your business into a thriving one is small. For that, you need every bit of knowledge and experience that one can only pick up in the workplace. We are not saying that you shouldn't venture into business if you haven't worked before. We are simply recommending that, to give youself the best chance of success, the most sensible way of going about it is to:
- Find a job, even part-time or as a volunteer.
- Use the job to observe and learn all you can about how organisations work, how business works, and how people work together.
- Convince the people you work for in every possible way to give you an opportunity. to manage more work, more systems and other people.
- Gain management experience, save money.
- Start a business.
- If you do decide to start a business without work experience, never stop reading and learning, even while you are running your business. Get constant advice. Learn from your mistakes. It is the most difficult path to choose, but there are people who have had success this way.
- Independence: Working for someone else can be frustrating sometimes, but you still need to be disciplined and able to get on with others when you work for yourself.
- Job satisfaction: Self-employment allows you to do the job in your own way, and it is very satisfying when your way is shown to work. You do, of course, also have to take responsibility when it does not work.
- Achievement and success: There can be some glory attached to running your own business, but make sure that you are not trying to prove that you are something you are not. The venture may even fail, despite your hard work. Will you be able to deal with this?
- Money: This is not usually enough of a goal by itself, as wealth is by no means guaranteed. You need to be sure that, even if never get rich, you still want to pursue a business of your own.
Is your personality suited to your business?
There is no single type of person that is successful in business, but experience has shown that there are some characteristics that successful self-employed people often have in common:
- Logical, organised and responsible (good at getting things done);
- Able to communicate and get their point across;
- Sociable, with the ability to take leadership;
- Single-minded, but able to take advice;
- Flexible and adaptable;
- Quick to take opportunities (and ready to take risks);
- Hard-working, committed and determined ('get up and go' type);
- Thick-skinned (able to handle failure);
- Individualistic (not afraid to stand out from the crowd); and
- Creative and imaginative (always coming up with new ideas for the business).
This list should give you an idea of the challenges you face. You do not need to have all these characteristics, and you will develop and grow with the experience.
If you intend to start up as a partnership, look for complementary characteristics in your partner. The best partnerships are ones where the partners have different abilities and strengths to contribute to the business.
The pressures of being self-employed are inescapable. You will be staking practically everything on your own ability. If it goes wrong, there will be no-one responsible but yourself. You may have to work long hours, and there will be times when things get on top of you. Think about how you would cope under these sorts of situations:
- You may well get into debt in order to finance the enterprise. Will you be able to maintain your faith in your business, often in the face of others people's doubts?
- If you employ people, you will need to be positive and show leadership all the time, even when you do not feel like it. Will you be able to be tough and to discipline difficult employees or make difficult demands of your suppliers?
- There will be times when you feel lonely, isolated and even under attack. Will you always be polite and helpful, even when an awkward customer is giving you a hard time?
This may sound like a nightmare, but you need to be the sort of person who can deal positively with such challenges. Above all, you need a lot of confidence in yourself, and the energy and toughness to get through the bad times.
Age and experience
There is no doubt that it helps to have some experience in the workplace, and particularly in the sector in which you want to start a business. Surveys reveal that many successful businesses have been started by people in their thirties who have some management experience.
On the other hand, young people have some particular advantages: they have fewer domestic commitments, plenty of energy, new ideas and the potential to develop and adapt to the challenges of self-employment. Those who typically succeed are in their mid-twenties with some education and experience behind them, but still at an early stage in their careers.
What are your abilities and resources?
Starting your own business is a risky thing to do, so you should get to grips with the various risks as early as possible. This will help you decide if you are willing and able to take those risks. It will also help you to apply strategies that will reduce the risk.
- Do you have the financial resources, and can you afford to risk these? For example, you might take a secured loan based on the value of your home. What are your plans if the business fails and you are forced to sell your house?
- Do you have the experience and technical skills to do the jobs that your new business needs?
- Do you know enough about the market to know what customers want, where to find them, and how to get ahead of your competitors?
- Do you have the personal tenacity and discipline to see through hard times when cash will be short and demands will be heavy (from customers, bankers, staff and family)?
In the end, there are no easy answers to such questions, but you must be honest with yourself and try to be as objective as possible. Discuss these points with friends, colleagues and relations. Think about how you have dealt with past challenges, as an indication of your response to difficult new situations.
While the production aspects of your business will require specific skills and experience, there are broader demands that are as important. These include the ability to:
- Negotiate with suppliers;
- Mediate between staff;
- Be sociable with customers;
- Be convincing with prospects;
- Think clearly under pressure;
- Take criticism without being offended or defensive; and
- Use your time effectively.
Skills and qualifications
- It is obviously important to have the technical skills and qualifications relevant to your business activity. You must be able to deliver professional standards of work to keep customers satisfied. Even when you apply for start-up finance, lending institutions will be more comfortable if you have strong qualifications. Certain businesses, such as those in design-related or artistic fields, require exceptional ability.
- Business skills are essential to develop if you do not already have them. It is important to understand the principles of business and management including marketing, strategic planning, accounts, personnel management, etc. Ideally, get some basic training in business administration before you start. If this is not possible (many people do not have the time or money initially), then read as much as you can to fill the gaps in your knowledge.
- Leadership skills: If you are happy for the operation to remain small in the long run, then you can continue to concentrate upon the daily "nuts and bolts" without worrying about leading, managing or inspiring others. In fact, many people enjoy self-employment because they have the freedom to work independently. However, if you expect your business to grow, you will inevitably have to employ people, and the ability to lead and manage others will be critical. Ask yourself: Are you good with people? Do you have management experience? Do you enjoy working in a managerial role?
- Selling skills: All businesses require an element of selling. Initially it is important to persuade people to support you, and crucial to be able to win over potential customers. It is possible to learn basic selling techniques, but being outgoing and articulate are equally important.
- Organisational skills: To generate sufficient income, small businesses must be well organised and efficient. It is important to be the sort of person who can organise yourself and others, plan ahead, manage your time and who has the discipline to set and meet deadlines.
- Family commitments: Many of those who successfully start their own business have the backing of their family - even if this is only in the form of moral support. You ill be under pressure, working long hours. Your family must be prepared for the impact this can have on family life. Also ensure that your family can accommodate the risks that self-employment can bring, especially in terms of lower income in the initial stages and maybe even the implications of the business failing.
Ideas for self-development
- Give yourself experiences that test out your abilities. For example, travel by yourself abroad or undertake a difficult project.
- The process of assessing your ideas never really ends. Sometimes it is necessary to go right to the brink of starting the business before you realise it is not for you. If the time is not right (for instance, you may need more experience or more money), it may still be an option for the future.
- Get advice about your business idea, and some feedback on your own capabilities, from an experienced business adviser.