According to the Small Business Administration (SBA), nearly 28 million small businesses currently operate in the U.S., with another 540,000 new businesses opening each month. Filing and establishing a business is a fairly easy thing to do, but understanding if you’re ready to devote your time and energy to the startup life is much more challenging.
The decision to start your own business is exhilarating. After coming up with the idea for your product or service, you may be eager to jump right into the world of business ownership. At the same time that starting a business presents an array of opportunities, the possibility of failure is always looming. Prior to diving headfirst into establishing your startup, there are key factors to take into account to ensure your timing is right. Here are a few questions to ask yourself before launching your new business:
Is my lifestyle stable enough to start a business?
Launching a business means devoting a large chunk of time and energy solely to getting it up and running. If you happen to be in the midst of major changes in your life, it may be best to let the first big life change play out before getting into your startup.
Making sure your personal and professional life is at a point where it can handle the many stressors of launching a business can save you from headache in the future. If you feel your current lifestyle is stable and will be able to handle the high intensity environment of a startup, this can act as a telltale sign that the timing may be right.
Can my financial situation handle it?
The reality is that almost all startups take time before they begin generating revenue, nonetheless a profit. As the business owner, you may go months without getting a single penny, as all of your revenue will likely go towards reinvesting into the company.
With this in mind, assess your financial situation and make sure you can handle a few hits without it affecting your lifestyle. Saving up some money and paying off pressing debts you owe are vital before starting your business. This way even if you struggle at the beginning, you know your financials won’t be too critically affected.
Have I worked out a business plan?
Working on your business plan is one of the very first steps that should be taken if you’re thinking of starting your own company. No matter how well thought out or innovative you think your idea may be, forgoing the business plan from an early stage is a recipe for disaster. A business plan helps you look at all the factors that determine whether your business will be successful, and can guide you towards identifying the most effective and efficient route.
Considering every detail of your idea will inevitably put you in a better position to succeed with your new company and understand the industry you’re working in. Ask questions like as how much capital will you need to launch? Have you shopped around for general liability insurance quotes? Do you know your unique value proposition? Assessing each component of the business will ensure the timing is right when you finally decide to launch.
You are motivated by what you’re doing
Motivation is the foremost factor in determining the success of any new business. As a business owner, it is crucial to understand what your motivation is and what is fueling you to move forward. If you find yourself wanting to start a business out of frustration with your current employment situation, this is not the motivation that will keep you going through the stressors of startup living.
However, if you are innately motivated by your business idea and truly love what you do, this is the type of motivation you’re looking for. This type of fuel will keep you going through the long hours and numerous obstacles that come across your path of starting a business.
So, are you ready to start laying the foundation of your new small business?