There are many people out there who aspire to be their own boss. However, not many are willing to lose the comfort or job security that their current employer provides them. It is both financially and psychologically difficult to even begin a small business. There are many factors to consider when deciding to take the plunge into the unknown and owning your own business. It is fair to say that starting a new business is not for everyone, but don’t let that stop you. Here are a few ways to help you prepare for your start-up and decrease your chances of failure.
Prepare to Leave your Comfort Zone
As we mentioned, leaving your job is challenging. It is scary to even consider it, especially if you have a lot to lose. But, if you are single with no children, living with your parents, and your day job is sucking the life force out of you, what do you have to lose by beginning your own business?
Slowly begin to prepare to leave your job by developing good spending habits. Start a budget that will help you create a surplus of cash. Once you have enough to start investing in your small business, go ahead and start (but check out the next tip before you do)!
You can consider opening the business but working in it part-time until you’ve reached the amount of growth that allows you to sustain yourself. Then, you can consider leaving your day job!
Develop a Small Business Plan
By developing a business plan for your small business, you are able to reduce the risk of failure and maximize your growth. A business plan describes, in detail, the business idea, the market you’ll be competing in, your marketing plan, expected revenue and expenses. It will make your life a lot easier, and set you up for success!
Establish a RRSP
After your business starts making profit, consider establishing a Registered Retirement Savings (RRSP) account. This allows you to shelter a good chunk of your income from tax. Each year, your money in the RRSP account will not be taxed.
If you can, ask friends or family around you who own businesses how they are doing. If you don’t happen to know anyone, we encourage you to ask small business owners in the neighbourhood (or online). Perhaps gaining their perspectives and hearing their experiences can help you develop your ideas. You never know who you will meet and how they will help you, but any advice is just advice, and you should think about it as such, rather than a “be all, end all” strategy.