Score: Before starting a business, ask lots of questions
Question: After working for more than 25 years in the publishing industry, the company I worked for downsized, and I accepted an attractive buyout package. Now I'd like to start my own business. What do I do first?
Answer: What's the first thing to do when considering starting a small business? Ask more questions.
That may seem like a rather flip response, but it's true. Success in small business hinges on gathering as much information as possible in order to make sound, informed decisions. That includes understanding your target market, your resources, and - perhaps most importantly - yourself.
Entrepreneurship has many rewards, but also many responsibilities. And if you're not prepared to handle them, those dreams of being your own boss will almost certainly become real-life nightmares.
So before drafting a business plan, brainstorming catchy company names, or pricing office space, pose a few hard questions to the person who will literally make or break your business - you: Is it the right time for me to start a business? The personal factors that affect the timing of a start-up can change quite frequently. According to Chicago-based business advisor Carol Roth, author of "The Entrepreneur Equation," "Your finances need to be in order, your responsibilities should be consistent with the ability to invest time and capital, and you should have the appropriate experience under your belt."
Can you handle the economic roller coaster? Long before volatility defined the general economy, businesses of all sizes experienced both good and bad financial times, a cycle that is sometimes hard to predict.
"You need to get used to variable income versus having a regular paycheck," says Rhonda Abrams, USA Today small business columnist and owner of the Redwood City, Calif.-based The Planning Shop.
Have I taken a hard look at my industry, market and competition and revised my idea accordingly? Abrams adds that the worst entrepreneurs are those who are set in their ways: "You need to be willing to challenge your own ideas, and have the flexibility to change." That includes making a commitment to short- and long-term planning from the outset. "Continually be aware of things that can affect your business, both threats and opportunities," Abrams adds.
Is my personality well-suited for entrepreneurship? Entrepreneurship requires taking risks, being proactive, and riding out the ups and downs. "If you are great at execution, but really prefer receiving direction on what to do next," warns Roth, "you may be better suited to work for someone than to have your own business."
If your responses have you second-guessing your small business plans, don't automatically give up. Roth says that while personal traits may be difficult to alter, "skills can be developed, changed, enhanced and even supplemented."
This column is brought to you by the Merrimack Valley Chapter of SCORE, with nearly 70 current and former business executives available to provide free, confidential, one-on-one business mentoring and training workshops for area businesses. Call 603-666-7561 or visit merrimackvalley.score.org for information on mentoring, upcoming workshops and volunteer opportunities. SCORE is a national, non-profit organization and a resource partner of the U. S. Small Business Administration.