So you want to turn your passion project into something bigger. Maybe you want to open up an art studio, run a freelance marketing business or become a life coach. Entrepreneurship isn’t easy, but if you learn to enjoy the journey rather than the destination you may find it highly rewarding.
Whatever your goal, it is important to understand what it takes to succeed as an entrepreneur before you begin. Knowledge is the most valuable resource you have when starting out. The team at SiDCOR accountants suggest having a think about the following before kicking off:
- Understanding how business works (or being willing to learn)
You might be great at designing greeting cards, but that doesn’t necessarily equate to being a good business person. Being a business owner requires you to have good generalized awareness and a solid vision for what your business will look like. Qualities of an effective entrepreneur include discipline, determination, curiosity, creativity and good people skills.
Being able to price and market your products or services, make a profit, track sales, pay your vendors and invoice your customers are all tasks that you must be able to do as an entrepreneur. If the thought of this fills you with dread, perhaps working as an employee for another business may suit you better.
- Knowing your niche
It is important to make sure your business idea has what it takes to succeed. Obviously you can’t always predict what the outcome will be, but having a bit of awareness around how profitable certain business ideas are doesn’t hurt.
It almost goes without saying that you should opt for a business idea that you are genuinely interested in and passionate about; running a business isn’t easy and your odds of quitting are much higher if you don’t love what you’re doing.
Make sure you consider the profitability of your niche. You can do this by mapping out the financials, looking at start-up and running costs as well as how much you need to make a profit.
Understanding your target audience can help you determine how much demand there is for your products or services as well as what price points you might want to set. Finally, looking at your competition and what differentiates you from the rest can help you figure out how profitable your business is.
- Figuring out what sales you can make
It’s all well and good to daydream and consider the hypotheticals, but when it comes down to it you need to make sure that you can actually sell your products or services in your chosen market. Write up a list of projects, small consignments or potential prospects you can secure to get a sense of how much work is currently available in your chosen area.
The state of your local economy will in part determine how much demand there is. For instance, demand for art is much higher in Lisbon, which is a cheap city to live in. In contrast, if you want to sell houses, Seattle currently has a great housing market. You may find that you need to wait a bit of time before starting up your business or move to a different area where there is more demand.
- Get career advice early on
Getting a career guide, mentor or advisor to help you out from the get-go is a great way to keep you on track, make smart decisions and avoid potential mistakes. Getting help from someone who has more experience than you can be hugely beneficial, in large part due to their knowledge of real-life case studies (something you don’t tend to get from a textbook!). They can also provide a beneficial outsider perspective, offering a different angle on your business (rather than just agreeing with everything you say).As Kev’s Best says, they can assist with training and coaching in order to help you become self-sufficient and come up with your own solutions.
Becoming an entrepreneur can be an intensely rewarding and fulfilling experience. However, it is important to assess whether starting up your own business is right for you or whether it might be something you want to do in the future.