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Considering Taking The Plunge And Starting A Business

There are pretty much more businesses failing every day, and as a result, more people are losing their jobs and facing redundancy.  With a second spike forecast, along with the phasing out of the Coronavirus Job Retention Scheme, the jobless rates could reach levels not seen since the Great Depression, or even more so. Finding new jobs will be difficult for many, especially the older workforce, in such a downturn, so many will look at other options, one of which is starting a small business.

A business needs funding to get off the ground. Funding will enable your business to grow and move in the right direction. The idea of funding your business yourself is important. It is also possible to acquire working capital from outside sources. Your dream business shouldn’t be stymied by a lack of capital. When it comes to funding your business, more options are available today than ever before. Assist business owners in finding the best financing options is one of the reasons the company was formed. Truthfully, there isn’t a one-size-fits-all answer to the question of when to seek funding, nor a simple solution for the issue. 

On the surface, this does not seem like a radical idea.  Since small businesses currently employ around half of the private sector workforce in the UK, joining them might seem like a good idea, since great changes bring great opportunities.  There’s no harm in giving it a try.  Quite a bit actually, so before you take the plunge, you might want to give it some careful thought.

  • Temperament 
  • Appetite to work 
  • Hiring and Firing 
  • Establish your offering 
  • Create a business plan 
  • Source Funding 

Temperament 

It is pretty much a daily occurrence for most small businesses to take risks and make decisions. Can you or could you become someone who is comfortable with this? Despite this, this never goes away as the bigger your business becomes, the bigger the decisions you need to make, as well as the bigger the downside if you make a mistake.  As a result, you should make sure that risk is something you can handle every day.

Appetite to work 

Many business owners work crazy hours, especially in the early stages when they have a lot to do but don’t have the budget to hire others to do it. Will it make you comfortable for at least a few years,  or is it the type that insists you go home at 5 o’clock and forget about work?  In the latter case, the world of SMB is probably not for you.

Hiring and Firing

Do you have any supervisory experience?  Are you capable of recruiting and managing other individuals, as well as disciplining them if necessary?  Is this something you are comfortable with?  Likewise, if it’s the latter case, then you may want to think twice about being your own boss since that usually leads to being other people’s boss as well. Even after considering all of the above, running your own business can be immensely rewarding, both financially and otherwise. 

Successful small businesses bring great benefits to a surprisingly large community of people.  Of course, all the employees you hire benefit directly from their employment, but so do their families and relatives. There are also benefits to shops, pubs, and restaurants that spend income. Your suppliers also benefit from your presence, and so do their own employees. The Treasurer makes his share of both your own income and your profits and the payroll tax levied on your employees, so thanks to you the entire county is better and as a result, the government Must provide that you can spend more on everything you need.

Before you press the go button, you should take some common-sense steps:

  • Establish your offering 
  • Create a business plan 
  • Source Funding

Establish your offering 

The first is obviously to decide what you want your new venture to do. Did you acquire marketable skills and knowledge that you can apply to your business in your pre-career?  If so, this may be a very powerful place to get started, as you may have an off-the-shelf network of potential customers and suppliers that, in addition to your knowledge, is at least half the battle. If not, start with an area you already have experience with, and what are your hobbies that can be a  profitable activity?

Create a business plan 

Once you have created an offering, it is imperative that you create a good business plan. There are many online resources to support this and government-sponsored support. Once you have a plan, it is just as important to have a third party with a background test and challenge you to ask offensive questions and challenge  optimistic assumptions. Asking your mom is probably not enough. 

Source Funding

The main sources of funding are retained earnings, liabilities, and capital. Companies use retained earnings from their businesses to increase or distribute dividends to shareholders. Companies raise funds by personally borrowing from banks or going public (issuing bonds). Last but not least, you should identify how much funding you will need and where you will get it. To put it simply, your funding comes from one of three places or a combination of them. 

A loan from a commercial lender, such as a bank, is the third option, which is often a loan from your own resources, friends, or family. It is no exaggeration to say that banks are not particularly keen on lending to SMEs today. Even if the application is successful, the security requirements will probably be quite annoying for more than a small amount. 

Billing a domestic residence is a normal form of security, with great pressure and risk. We also recommend using your own resources. You’re essentially putting your money at risk, so you don’t have to dance to the tone of an outside lender as long as you’re happy if something goes wrong. You can survive the loss without catastrophic consequences. Get ready for a wild ride, but hopefully, it may be the best decision you’ve ever made. Still, citing Shakespeare’s Julius Caesar, “There is a tide in personnel affairs, which leads to happiness.

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