Business ownership can be achieved in three ways: Start a new business from scratch; buy an existing business; or invest in a franchise, which is a proven business model.
What is important is to understand the pros and cons of each approach. Whatever approach is of interest to you, here are three major tips to consider prior to starting your business:
• Why are you considering starting your own business: Tired of layoffs and job insecurity? Can’t find a “job?” Independence and more control of your schedule? Financial planning for retirement? Always “dreamed” of owning your own business?
The “why” behind starting your business is critical. Be sure the business model you select will obtain your goals — financial, professional and personal. Write down these goals and objectives prior to beginning your business ownership research process. Select the business model that is best for obtaining these goals.
• Investment: Do a thorough financial plan. How much money can you comfortably invest in a business? How much money are you willing to “put at risk?”
And be sure you consider your personal financial obligations — children’s school, mortgage/rent, food, current loan obligation and health insurance. These expenses must be covered outside your business. Plan on at least a year before you can pull money from your business for personal expenses.
• Ideal business model: Take time to really consider your business model — number of employees and type of employees (professional or technical); type of customer (other businesses or end consumer); days and hours in the week you want your business to be open; type of business (service, retail, educational, professional); where will you “work” (home office; office space; retail location); how comfortable are you approaching your customers (cold calling; networking; customers coming to you).
You are probably in a comfort zone with how you have worked up to this point. Be sure you can transition from your current job style into a new business style that is yours.
Cathey Petkash is a franchise specialist with FranNet, which helps people who are considering business ownership. Contact her at 678-644-3868.
Cathey Petkash will speak at SCORE’s Top Ten Tips Monthly Lecture Series on Thursday, Feb. 28, from 11:30 a.m. to 1 p.m. at the Small Business Resource Center, 111 E. Liberty St. She will discuss the top ten tips for choosing a winning franchise business. Lecture is free. RSVP to email@example.com.
SCORE is a nonprofit organization dedicated to helping the small business community through free mentoring and business counseling. Business hours for the Savannah location of SCORE are Monday through Thursday from 10 a.m.-2 p.m. Go to www.scoresav.org for more information.