Starting a small business is not as difficult as many fear
How often have we heard people say there are no jobs out there? Or the jobs are all lousy and low-paid and don’t give you enough hours or dollars to make a decent living?
Or they might be very good, well-paid jobs, but they require a level of specialized skills and experience that few people have and aren’t quick or easy to get?
Or the employers we used to think were good and secure are now more likely to downsize than hire?
In the old days, those quality employers would show up on campuses to vacuum up the graduates.
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Now, they carefully pick a few of the best and the most specialized, if they appear at universities.
So since finding a job is so challenging, why not create your own?
Becoming self-employed or starting a small business is not as difficult as many fear. And it has some unique advantages, including that you can’t be laid off and there’s no ceiling on how much income you can make.
Here are three steps to get you started on creating your own job:
Ask the entrepreneurial questions
The first question is: “What good or service can I supply that someone is willing and able to pay for?”
As a business person, you’ll more likely provide a service than a good. It takes only about 10 per cent of our economy to provide all the goods we need. The other 90 per cent of the economy is made up of services, from the basic, like food service or manicures, to the highest, like environmental impact analysis or artificial intelligence.
The second question is equally important and often not considered: “How much is my good or service worth?”
Many may want your expertise, whether it’s in tax minimization or counselling, but they may not be able to pay for it, perhaps because they’re struggling startups themselves.
Too many people who go into business set their fees based on what they would like to earn rather than what potential customers can pay. Check the market to see what it can bear.
Find three customers
You need customers if you’re creating a job and hoping to generate income. That’s probably the biggest challenge in going out on your own. There’s no pot of money you’ll get paid from; you have to bring it in.
So, before starting your new business, line up at least three paying clients. Then, even if two of them don’t work out, you’ll still have some income from the third. If you can’t find at least three potential customers, go back to the entrepreneurial question and adjust your potential client base, the good or service you’re offering or, perhaps, your prices.
An exception to getting three clients from the start is if the projects you’ll be working on are lengthy and complicated. Engineering, project management and similar work fall into this category. You couldn’t manage more than one project at a time. So line up that one big project and plan to do it well.
But keep up your networking and have in mind other potential sources of work for when the first project ends.
Minimize your overhead
You don’t want to incur a lot of expenses before you have any money coming in. Some people who’ve never run a business before feel they have to rent an office, hire staff and buy equipment so they can be a ‘real’ business.
This is nonsense and a fast, easy way to go broke.
For many new operations, you need little more than a connected tablet or smartphone. If you want dedicated workspace, a home office may be just fine.
If you need help, think of bringing workers in on contracts rather than as employees. That way, you’ll only be paying people when you have money coming in to cover those costs. Many workers today prefer the freedom of contract work to being tied down in a job. You may soon be one of them.
You can succeed in starting up a business. Some businesses don’t make it, but once you’ve started one, you know how to start another. Even if your business doesn’t turn into the next Google, it can still give you a good living and a good life.
And, who knows, maybe it will be the next Google.
Dr. Roslyn Kunin is president of the Vancouver Institute and has been chair of the Vancouver Stock Exchange, WorkSafe BC, and Haida Enterprise Corporation. She has also been on the boards of the Business Development Bank of Canada (BDC) and the National Statistics Council.
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