In a previous edition on this page, we considered the small business option for surviving loss of paid employment. As a follow up, we have drawn up an action list for deciding on and financing a new business.
The strategies below are likely to alert you to problems and help you out of them.
Personality profile
Successful self employed persons reveal certain common traits. Human resource experts, in the book Business: The Ultimate Resource, identified that successful, self employed persons are logical, perceptive, organised and responsible.
They are open minded, ready to interact, confident, have communication skill, the ability to take a lead, generally single-minded but listen to advice. They are also believed to be flexible, adaptable to change, smart to exploit opportunities and ready to take risks.
They are courageous and able to handle failure, are creative, imaginative, full of new ideas for the business. They are hard working, committed, have a skills set and are determined to standout from the crowd.
The above character traits mark out the successful self employed. Those who want to venture into sole enterprise should, like them, have such traits in good measure.
Skills set
Skills gap is the bane of most startup businesses. An entrepreneur with the skills set relevant to his business is likely to make a difference, all other factors being equal.
In some cases exceptional ability, such as technical, artistic and design skills might be required and the entrepreneur has to do the needful.
You need to train in the principles of business, business management, administration, marketing, basic accounting, strategic planning, personnel management, and more.
Persuasion for support may not take you far enough. Learn the basic techniques of marketing which your business requires. Better than anyone else, the business owner is the one to blow his own trumpet.
To sustain your operation, these skills and knowledge are relevant and of great advantage to place the entrepreneur in good stead to manage his business properly.
But where you do not have these skills, read them up to prepare yourself, or engage someone with a fair knowledge to manage these aspects of the business.
Plan ahead, organise yourself and anyone under you, and manage your time well. All other things may be smooth in the day to day operations.
SWOT analysis
Before taking off, do a SWOT analysis to determine your abilities, resources, risks and come to terms with risks involved in your choice of business as early as possible.
SWOT analysis will reveal your strengths (S), weaknesses (W), opportunities (O) and threats (T). This is a basis for assessing core capabilities and competencies, a framework for analysing a situation and developing appropriate strategies and tactics.
Then you have to determine your financing sources. Secured loans based on the value of your collateral or personal savings may not be enough.
You also have to determine your level of familiarity with the market to be aware of needs. Adapt to changes.
With this knowledge, develop a bulldog tenacity, discipline and forthrightness to see you through rough times.
Motivation
Let your motivation be the sense to fulfill demand and not to make more money. Keep your motivation always in view. This has to be the very reason and driver of the business, and in the course of that, other things like money, success and job satisfaction can be achieved.
Financing the new business
Getting enough money to start with, keeping operations running or expanding in the face of profitable opportunities are among the most common challenges facing enterprenuers.
You may consider the following
• Raise either quick cash that is short term; or bulk money, also called long term capital.
• Sell your valuables or property.
• Give discounts on advance sales.
• Offer special deals to attract patronage.
• Road shows and pay it now discount for outstanding invoices.