Is now a good time to be launching a business? Should you really be going it alone when every newspaper headline or TV business bulletin warns of trouble ahead? The answer could well be "yes". To put it crudely, if you have a good enough business idea you should be able to launch it regardless of the economic background.
However, this view can be tempered. One way to answer the question whether you should go it alone and forsake the protection of a big employer is to ask two further questions: Just how secure is your job with this big employer?
Second, is the product or service you want to produce the kind of thing that people will always need, or is it something that will be the first to be cut back on during an economic downturn? For example, you could rank things into three main categories: things people will always need, whatever the economic situation; things they need, but can put off buying; and the first things they cut back on when a downturn arrives.
Things people always need: food, drink, clothing. Things they can put off buying: property, cars, consumer durables. First things to be cut when a downturn comes: advertising, party arrangers, estate agents.
These are just general examples. For instance, while food is always a necessity, the more fancy end is bound to suffer come a downturn. Restaurants are also a barometer of the economic climate, as are taxis.
So, the 10 top tips for getting your business idea off the ground:
1. Evaluate yourself
Be ruthlessly honest. Do you really have the character to go it alone? Question why you want to do it: is it just to get away from a current boss or pressurised deadlines? These are not good enough reasons. Some people find it even more difficult to be their own boss. You must realise that you will now be working to self-imposed deadlines. Do you have the self-discipline to work to timetables and within budgets?
You must identify the skills and knowledge you have accumulated over the years. You may well be surprised by the breadth and depth of your expertise. This must form the basis of your decision whether you have what it takes to go with your business idea. If not, you may need to rethink.
Don't be downhearted if the latter is the case. You may be able to outsource the expertise required or embark on retraining to acquire these skills yourself.
2. Decide which business you want to be in
Have you got a unique business idea? Be sure to research both the potential market and the competition. The best way to go about researching your idea is to start with clear personal objectives. In other words, what do you want to achieve by running your own business? Some things to think about are how much money you want to make and how hard you are willing to work.
3. Make sure you have customers
Every business depends on having people who will pay you for your goods or services. Without these, there is no business. You can have the most beautiful and efficient products and the best services in the world, but if no one wants to buy them, you have no business.
4. Make sure you have a sound financial base
You may not be able to draw a salary from your business for a year or so, or at least until it is making money. Make sure all your insurance covering your house and life is up to date. Do an audit on your personal finances, comparing your savings to your borrowings. Do you have enough slack to cover any lean times ahead?
5. Talk to as many people as possible to get advice
This means literally anyone. You would be surprised how many people have experience of having once been involved in a business launch, or who might have something to say about your idea. This can be tricky when still working for another organisation. You must also discuss your ideas with your family. If they are not 100 per cent behind you, it is extremely unlikely that you will be able to make your project fly.
6. Assemble your key team
An enormous number of new businesses are formed by groups of former employees who have been working together in a large organisation and realised they could do the same business independently, taking the profit for themselves. Having said that, many successful businesses are set up by people on their own. It is amazing how many services you can outsource, for instance by using serviced offices, IT consultants and bookkeeping agencies.
7. Assemble your key advisers
This is crucial in setting up a business. If you can find an accountant or a lawyer that you can trust, and who has experience of advising young businesses, preferably start-ups, then you are ahead of the game. You will also have to deal with a bank manager, or more probably small business adviser at one of the main banks.
8. Consider 'toe dipping'
If it is at all possible, try out your business idea while still working for someone else. See if your employer will allow you to go part time.
9. Write a business plan
These plans are normally used by banks or investors to decide whether to give you money. Guides to preparing business plans are available free from all the major banks. Even if you are not intending to borrow or raise capital, business plans are excellent ways to crystallise in your own mind exactly what your business is and how it will work. It will force you to thrash out a cashflow forecast for the first three years at least and to set goals against which you can measure your progress.
10. Most importantly, trust your own instincts
Does it feel right? If you have a gut feeling that there is a market out there for your goods or services and you would enjoy working in your new business – then get on with it!
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