Start Your Own Business: A Reality Check
Blog entry written by Daniel Burden, Iowa State University Extension, Value Added Agriculture Program coordinator
So you want to run your own business. Good for you. Most people do not, because they are quite comfortable collecting a paycheck and going home at the end of the day. However, it seems like everyone fantasizes about being some kind of entrepreneur. Good for them.
You plan to run your own business, be your own boss and that sort of thing, and you are completely serious about it. Ok, so let’s look at what is really going to happen. If you want to try it and fail, that is very easy to do. Just start it, and figure it will run itself and that nothing unforeseen or unplanned will tip your wagon. This may work for you, probably it will not. For example, how are you drawing a wage or more precisely, when are you, your suppliers or employees getting paid? Have you thought about that? Do you have a plan on paper to cover those bases; as well as liability insurance, license fees, subcontractor or supplier delays or market disruptions?
What about competition? What if your technology or consumer craze is leapfrogged by a snazzier technology or consumer craze? There is an old military saying, “Amateurs fight wars based on strategy; professionals win wars based on logistics.” You can’t beat “proper-prior planning” on paper before you invest a dime. On paper, once you have exhausted all the “woulda-coulda-shouldas,” then you might just be ready to bring a successful enterprise into the world.
Also, if you don’t quit your day job until the other one begins to bear fruit, you may have a little breathing room in which to mold your proposed idyllic model to fit reality. If you jump in with both feet; well, I hope you know how to swim and have good stamina, especially if the current is not in your favor. Let’s face it, you are going to be a happier and more successful person if you can cover your living expenses with a job while developing a new one on the side without the pressure of teetering on the edge of personal financial trouble.
Many people confuse fun hobbies and crafts with thoughts about making a living from them. Keep fun activities fun activities. If you can make a few bucks and get a few tax credits from your hobby business, good for you. If you are serious about taking your fun thing to the next level, they you had better take the time to develop a pre-feasibility study, feasibility study, and formal business plan; have them reviewed by friends, family and business-development professionals, and be prepared to make concessions and adjustments to your “great idea” where necessary. Feasibility study and business-plan development is the key to the successful “reality checking” of your thought process. This information is readily available for free elsewhere on AgMRC, The Small-Business Administration, and any number of entrepreneur-support websites.
Sound business planning, as discussed here within AgMRC or from the pages of any of the good “how to” books or elsewhere on public-domain websites, will help you get your ducks in a row. And the first ducks in line are figuring out whether or not this venture is really for you, will it cash flow and when, what is the time commitment, and are there any potential monsters lurking to devour you from off the happy path.
If you embark on the path to self-employment, here is word of encouragement about attitude adjustment. I have a good buddy, an accomplished entrepreneur who regularly faces situations that would give me grayer hair, chronic insomnia and quadruple my alcohol consumption. He calls many of the harrier monsters, “The Drill.” And I have been through a few of them with him. The essence of it is this: If you keep your head clear and realize that whatever the problem is, no matter how serious, it is just a temporary hurdle and a learning experience. As he puts it, “It is really just one of life’s ordinary little unsightly boogers.” Well, with that attitude, you suddenly have a different, more bemusing and positive attitude toward life’s negative side of “experiencial diversity.” You are much farther ahead than the guy who opts to jump out from a 50th-story window after reviewing his recently tanked stock portfolio.
Real entrepreneurs realize that there are going to be “those days.” Days, weeks or maybe even months where “the Drill” is kicking your butt. But if you face it and beat it, as you probably will if you have done your preliminary homework and kept your wits about you, then when it is over and the time comes to kick back with a glass of wine, you can congratulate yourself on staring the ugly monster in the eye and wrestling it to the floor. That is the attitude it takes to start your own business. It is not a goal but a journey and one that can be the most exciting and fulfilling of any in your life. Especially if have a good road map to negotiate the twists and turns in the road.
Do your research and create a business plan. Get the help of professionals who can guide you through the process and have answers to your questions, or at the least can point you in a positive and helpful direction to find them. These folks will not mind, they enjoy helping you. That is why we are in this line of work; and let’s face it, we are all very soundly human, for most of us have already made some pretty silly mistakes building our own castles in the sky.