Why choose a Home Business?
There are many short and long-term benefits of joining or starting a home business. The tax benefits are very significant, in many cases allowing you to pay for many items with before tax dollars that you might normally pay for with after tax dollars. Generally there is also a large incentive to invest in your own business as most, if not all expenses related to building your home business, whether it is internet/computer related expenses such as hosting to advertising or printing, can be paid for with before tax dollars. Of course many communication, shipping and/or general transportation costs may very well fall under this category. In fact, many people decide to join a home business opportunity entirely for the tax breaks associated with it.
Joining a Home Business also offers unprecedented freedom. There is perhaps nothing more valuable in life than freedom, and working your own home business, especially one that utilizes e-commerce, allows you to eventually decide your own schedule, your own vacation time, and in fact your own destiny. Every year, thousands of people decide to take control of their lives and future by going into business for themselves. Even among those laid off or downsized, self-employment can be as much an act of liberation as desperation. Studies have shown that starting in the early 1980's, home businesses have grown from about 5 to 30 million. This is because people are taking a second look at their priorities. People are asking themselves if the commute to work is really worth it. Is the stress and aggravation worth it. Are you working just hard enouph to avoid getting fired? Are you being paid just enouph to keep you from quiting? Is your work creative and inspirational, and are you making a difference in other peoples lives? Is every day merely a struggle in a dog-eat-dog environment?
Every year, more and more people discover the joy and time freedom of residual income and home businesses. They realize that there so many tangible as well as intangible benefits associated with this kind business. They learn that you do not commute, and there is no dress code. You do not compete with people that you are elbow to elbow with. And once established, you are not restricted to one area. You can travel at will!
Thursday, June 28, 2007
Monday, June 25, 2007
How do I start a home business
From time to time (at least once a day actually) I'll get an
impossible-to-respond-to email that says something like,
"How can I work from home?", or "I want to start my own
home business. Please send info." or even, "Please send
free info.". Naturally such vague, generalized requests are
not, for reasons of time (among others), going to elicit a
particularly helpful response but it does exemplify the
mindset of a proportion of my site visitors - they think they
want to start a home business but where on earth do they
start?
HOW DO I START A HOME BUSINESS?
The best advice I can give to someone who asks a question
as vague as this is that they're asking the wrong question.
The first question they should be asking themselves is:
"SHOULD I start a home business?", not HOW do they do so.
The person who asks how to start a home business has not
given much, if any, thought to what they might do as such
a business (otherwise, their question would be "How do I start
an errand service home business?" or "How do I start a gourmet
gift basket home business?").
So, first things first. Why do you want to start a home
business? What are the advantages as you see them?
What are the disadvantages? What entrepreneurial qualities
do you bring to the table that make you think you could
make a success of your own business? What is your plan?
What product or service will you market? Who are your
customers? When will you give up your day job? Are you
thinking about this because you just LOST your day job
(if so, warning bells should be ringing very loudly!)? A home
business is most definitely NOT for everyone and it's
certainly not a solution to unemployment per se.
There are financial considerations too, obviously. How will
you support yourself until you generate a profit? Where will
you obtain financing?
Assuming you work your way through the above considerations
and conclude that you do, indeed, want to start your own
home business, then, and only then, should you ask "HOW do I
start a home business?"
There are as many answers to this question as there are
individuals who ask it. There is no one answer that fits all
sizes. Generally speaking, however, the process of starting
one's own home business can be broken down into seven
broad steps.
=> IDENTIFY YOUR PASSIONS
If you're truly starting at ground zero and you don't already
do something on the side that you'd kind of like to see if
you could make fly, your first step is to decide what it is
you'd like to do as your business.
I'm a firm believer in following your passion, whether that
be for gardening (start a herb and spice business or
cultivate cuttings for distribution via mail order), lead-
lighting (design and create stained glass lampshades),
accounting (run a home-based small business accountancy
service) or website design. It doesn't matter whether
other people are equally as passionate about what
you're passionate about. It's YOUR passion that counts
and it's YOUR passion that will propel you towards
success. Do something you love to do in other words.
Make your work your joy and you won't be able to help
but succeed.
=> IDENTIFY A NICHE MARKET FOR YOUR PASSION
Now, it's one thing to know what you're passionate
about, it's quite another to identify an unmet need in
that field. But that's what you must do if you want to
turn your passion into a truly profitable business venture.
Identifying your niche is a pretty straightforward
process:
1. Identify your general category and sub-category
Let's say your general passion is gardening. Gardening is
your general category. Let's also say that you're
particularly interested in growing herbs and how they
can be used for cooking and medicinal purposes. Herb
growing is your sub-category.
2. Hang out with people interested in your sub-category
In order to identify unmet needs in your sub-category
(step 3.), you must find out from people interested in
your sub-category what they're looking for that they
can't find. A good way to find out is to hang out where
they hang out - offline and on. Offline, you may belong
to a local gardening club or cooking class at which you
hear that so-and-so has been looking high and low for
a certain type of specialty herb that isn't commonly
grown in your country. Online, you may sign up for
mailing lists and hang out in newsgroups to listen to
what people are asking time and again.
3. Identify unmet or under-met needs in your sub-category
If you follow step 2, chances are, if you hear the same
things repeatedly, you've found potential unmet needs
or needs that aren't being adequately serviced by your
competition. After all, if the need is being met, it won't be
the subject of repeated questions.
4. Inventory your experience, interests and competencies
In order to decide what to focus on in particular out of
a group of potential unmet or under-met needs, take account
of your experience, interests and competencies. People are
generally good at what they enjoy and are interested in,
after all.
5. Fill the unmet or under-met need
Once you've identified the unmet need(s) in your
sub-category, you can start thinking about how your
business can fill that unmet need.
=> SURVEY THE MARKET AND YOUR COMPETITION
At this stage, you need to take your business idea
and survey your niche market and your competition.
If you have competition, can you be better? If your
market is dominated by a few large, well-established
players and you really don't bring anything new or
different to the table, then the competition is probably
going to be too stiff. On the other hand, if that
competition is focused on the high end of the market
leaving the lower end largely uncatered for, then this
could well be an excellent niche for you.
The bottom line is to identify your best competition in
your niche and decide whether you can be better.
Only if you believe you can be the best in your
niche should you proceed. If not, keep looking until
you find a niche perfectly suited to your particular
blend of experience, interests and competencies in
which you can be the absolute best.
=> BUSINESS PLAN
Once you've identified your niche and surveyed your
market and competition and are reasonably confident
you can be at least as good as your best competitor,
it's time to get down to brass tacks.
This is where you take your business idea and shape
it into a battle plan. Formulating a business plan is
goal-setting for your business.
Once you've thought through and recorded your
business plan you should have an extremely
thorough understanding of your industry and the
challenges you must overcome to make a success
of your business. Take your business plan and
establish objectives, goals (which support attainment
of the objectives) and tasks (which support attainment
of the goals).
Put your tasks and goals into action to achieve
your objectives. Decide where you want your business
to be in five years time and work backwards until
you have 5, 4, 3, 2 and 1 year objectives and goals
to support them and tasks to support the goals. The
end result should be a daily to-do list of things that
will directly lead you closer to the achievement of
your goals and objectives.
=> ACTION
Once you have your daily to-do list, DO IT! The best laid
plans of mice and men are useless if not translated into
action. It's action that will propel you and your business
towards success. Mere thoughts and plans are necessary
but insufficient. They must be translated into activity.
=> TRANSITION
If possible, transition from whatever you're doing now
into your business. Test the waters, in other words.
If you're currently in a paid job, stay there and run
your business part-time, taking the risk on someone
else's nickel until you can be confident this thing's
going to float. Know when you're better off devoting
your full time and attention to your business (i.e.,
know when an hour of your time is worth more when
spent invested in your business than your job) for
that is the time to shift into full-time entrepreneurship.
=> MAKING THE LEAP
Finally, make the leap with faith and courage. Sure,
you'll have moments of self-doubt, thoughts of
"can I do this?" when you're wondering where the next
order's going to come from and you think back to the
nice, safe, secure paycheck you used to be able to
count on in your job. But recognize these insecurities
for what they are. They are your mind playing tricks
on you. You can do anything you set your mind to.
You just have to want it badly enough. So, when the
time comes to make the leap, do it and hold nothing
back. Your success or failure is up to you alone.
There are no excuses.
So, in answer to the question "how do I start my own
home business?", it's quite simple really. You do what it
takes.
impossible-to-respond-to email that says something like,
"How can I work from home?", or "I want to start my own
home business. Please send info." or even, "Please send
free info.". Naturally such vague, generalized requests are
not, for reasons of time (among others), going to elicit a
particularly helpful response but it does exemplify the
mindset of a proportion of my site visitors - they think they
want to start a home business but where on earth do they
start?
HOW DO I START A HOME BUSINESS?
The best advice I can give to someone who asks a question
as vague as this is that they're asking the wrong question.
The first question they should be asking themselves is:
"SHOULD I start a home business?", not HOW do they do so.
The person who asks how to start a home business has not
given much, if any, thought to what they might do as such
a business (otherwise, their question would be "How do I start
an errand service home business?" or "How do I start a gourmet
gift basket home business?").
So, first things first. Why do you want to start a home
business? What are the advantages as you see them?
What are the disadvantages? What entrepreneurial qualities
do you bring to the table that make you think you could
make a success of your own business? What is your plan?
What product or service will you market? Who are your
customers? When will you give up your day job? Are you
thinking about this because you just LOST your day job
(if so, warning bells should be ringing very loudly!)? A home
business is most definitely NOT for everyone and it's
certainly not a solution to unemployment per se.
There are financial considerations too, obviously. How will
you support yourself until you generate a profit? Where will
you obtain financing?
Assuming you work your way through the above considerations
and conclude that you do, indeed, want to start your own
home business, then, and only then, should you ask "HOW do I
start a home business?"
There are as many answers to this question as there are
individuals who ask it. There is no one answer that fits all
sizes. Generally speaking, however, the process of starting
one's own home business can be broken down into seven
broad steps.
=> IDENTIFY YOUR PASSIONS
If you're truly starting at ground zero and you don't already
do something on the side that you'd kind of like to see if
you could make fly, your first step is to decide what it is
you'd like to do as your business.
I'm a firm believer in following your passion, whether that
be for gardening (start a herb and spice business or
cultivate cuttings for distribution via mail order), lead-
lighting (design and create stained glass lampshades),
accounting (run a home-based small business accountancy
service) or website design. It doesn't matter whether
other people are equally as passionate about what
you're passionate about. It's YOUR passion that counts
and it's YOUR passion that will propel you towards
success. Do something you love to do in other words.
Make your work your joy and you won't be able to help
but succeed.
=> IDENTIFY A NICHE MARKET FOR YOUR PASSION
Now, it's one thing to know what you're passionate
about, it's quite another to identify an unmet need in
that field. But that's what you must do if you want to
turn your passion into a truly profitable business venture.
Identifying your niche is a pretty straightforward
process:
1. Identify your general category and sub-category
Let's say your general passion is gardening. Gardening is
your general category. Let's also say that you're
particularly interested in growing herbs and how they
can be used for cooking and medicinal purposes. Herb
growing is your sub-category.
2. Hang out with people interested in your sub-category
In order to identify unmet needs in your sub-category
(step 3.), you must find out from people interested in
your sub-category what they're looking for that they
can't find. A good way to find out is to hang out where
they hang out - offline and on. Offline, you may belong
to a local gardening club or cooking class at which you
hear that so-and-so has been looking high and low for
a certain type of specialty herb that isn't commonly
grown in your country. Online, you may sign up for
mailing lists and hang out in newsgroups to listen to
what people are asking time and again.
3. Identify unmet or under-met needs in your sub-category
If you follow step 2, chances are, if you hear the same
things repeatedly, you've found potential unmet needs
or needs that aren't being adequately serviced by your
competition. After all, if the need is being met, it won't be
the subject of repeated questions.
4. Inventory your experience, interests and competencies
In order to decide what to focus on in particular out of
a group of potential unmet or under-met needs, take account
of your experience, interests and competencies. People are
generally good at what they enjoy and are interested in,
after all.
5. Fill the unmet or under-met need
Once you've identified the unmet need(s) in your
sub-category, you can start thinking about how your
business can fill that unmet need.
=> SURVEY THE MARKET AND YOUR COMPETITION
At this stage, you need to take your business idea
and survey your niche market and your competition.
If you have competition, can you be better? If your
market is dominated by a few large, well-established
players and you really don't bring anything new or
different to the table, then the competition is probably
going to be too stiff. On the other hand, if that
competition is focused on the high end of the market
leaving the lower end largely uncatered for, then this
could well be an excellent niche for you.
The bottom line is to identify your best competition in
your niche and decide whether you can be better.
Only if you believe you can be the best in your
niche should you proceed. If not, keep looking until
you find a niche perfectly suited to your particular
blend of experience, interests and competencies in
which you can be the absolute best.
=> BUSINESS PLAN
Once you've identified your niche and surveyed your
market and competition and are reasonably confident
you can be at least as good as your best competitor,
it's time to get down to brass tacks.
This is where you take your business idea and shape
it into a battle plan. Formulating a business plan is
goal-setting for your business.
Once you've thought through and recorded your
business plan you should have an extremely
thorough understanding of your industry and the
challenges you must overcome to make a success
of your business. Take your business plan and
establish objectives, goals (which support attainment
of the objectives) and tasks (which support attainment
of the goals).
Put your tasks and goals into action to achieve
your objectives. Decide where you want your business
to be in five years time and work backwards until
you have 5, 4, 3, 2 and 1 year objectives and goals
to support them and tasks to support the goals. The
end result should be a daily to-do list of things that
will directly lead you closer to the achievement of
your goals and objectives.
=> ACTION
Once you have your daily to-do list, DO IT! The best laid
plans of mice and men are useless if not translated into
action. It's action that will propel you and your business
towards success. Mere thoughts and plans are necessary
but insufficient. They must be translated into activity.
=> TRANSITION
If possible, transition from whatever you're doing now
into your business. Test the waters, in other words.
If you're currently in a paid job, stay there and run
your business part-time, taking the risk on someone
else's nickel until you can be confident this thing's
going to float. Know when you're better off devoting
your full time and attention to your business (i.e.,
know when an hour of your time is worth more when
spent invested in your business than your job) for
that is the time to shift into full-time entrepreneurship.
=> MAKING THE LEAP
Finally, make the leap with faith and courage. Sure,
you'll have moments of self-doubt, thoughts of
"can I do this?" when you're wondering where the next
order's going to come from and you think back to the
nice, safe, secure paycheck you used to be able to
count on in your job. But recognize these insecurities
for what they are. They are your mind playing tricks
on you. You can do anything you set your mind to.
You just have to want it badly enough. So, when the
time comes to make the leap, do it and hold nothing
back. Your success or failure is up to you alone.
There are no excuses.
So, in answer to the question "how do I start my own
home business?", it's quite simple really. You do what it
takes.
Saturday, June 23, 2007
Do you have what it takes to be an entrepreneur?
Fully one in ten adults in the United States today is an entrepreneur.
This phenomenon is by no means restricted to North America. The
leading country for entrepreneurship is Brazil with one in eight adults
an entrepreneur. Australia is not far behind the U.S. with one in twelve.
These countries - Brazil, the United States and Australia - lead the
way. Contrast, for example, Germany (one in 25), the United Kingdom
(one in 33), Finland and Sweden (one in 50) and Ireland and Japan
(less than one in 100). (Source: Global Entrepreneurship Monitor
2000.)
ENTREPRENEURSHIP DEFINED
The Global Entrepreneurship Monitor 1999 defined entrepreneurship
as "any attempt at new business or new venture creation, such
as self-employment, a new business organization, or the
expansion of an existing business, by an individual, a team
of individuals, or an established business."
ENTREPRENEURIAL ACTIVITY - AN HISTORICAL PERSPECTIVE
Entrepreneurship is a major contributing factor to the economic
well-being of a country both in terms of economic growth and
job creation. Traditionally, entrepreneurial ability tended to focus
on the following four attributes:
=> Initiative - the entrepreneur takes the initiative to bring together
the economic resources of land, labor and capital to produce a
commodity (whether a good or a service) with the hope that
such production will create a profitable business venture.
=> Decision-making - the entrepreneur makes the basic business
policy decisions for the business, thereby setting the course of
the enterprise.
=> Innovation - the entrepreneur is an innovator, attempting to
introduce new products and new ways of doing things.
=> Risk-taker - the entrepreneur risks his or her time, effort,
business reputation and invested funds in the entrepreneurial
venture.
THE MODERN ENTREPRENEUR
Until recently, the above attributes, especially innovation and
risk-taking, were the dominant factors that defined the
characteristics of those who chose to become entrepreneurs.
Now, however, with corporate downsizing being a fact of life,
many entrepreneurs find themselves thrust into the role by
default.
The question for anyone either finding themselves in this position
involuntarily or thinking about leaving corporate life for the heady
world of entrepreneurship is whether you have what it takes to be
successful ... the "right stuff" in other words. Some people do, in
spades. Others simply don't. If you're one of the ones who just
doesn't, either resign yourself to working for someone else or
cultivate in yourself the qualities that successful entrepreneurs
share. Believe it or not, entrepreneurs are not just "born". Well,
some, of course, seem to be natural-born entrepreneurs, but
for the rest of us, the qualities of entrepreneurship can definitely
be acquired by hard work and application.
COMMON ISSUES
The "common denominator" issues facing all entrepreneurs
are planning, finance and implementation.
=> Planning
All entrepreneurs face the challenge of starting a new business,
be it through innovation (inventing something new or doing
something a different way), finding the right opportunity to
get into, or buying a franchise. Whichever road you choose,
it will involve serious planning.
=> Financing
Unless you have ready funds at your disposal, getting finance
is the next major challenge and cannot be attempted until
your business plan is in place. You will need to prepare
funding proposals and applications for loans, venture capital,
and funds from angel investors.
=> Implementation
This is make or break time. Many people think just getting
started is the hard part - and it is hard. But where many
businesses stumble is not in the planning and financing
stages but in implementing their business plan. Why this is
so is not certain. There are various hypotheses including the
idea that ideas people and implementation people are two
very different breeds and it is highly unusual to find one person
who can do both. More likely though, is the simple fact that
implementation requires such a broad range of skills that
no one person can possibly be adept at all of them.
The real challenge and skill of the entrepreneur, then, is to
recognize what you do well and then appoint employees
or subcontractors to do the rest. Of course, if you're running
a business on a shoestring, this simply may not be possible!
So be brutally honest and objective in assessing your particular
strengths and weaknesses BEFORE you cash in your day
job and your 401K.
The areas to think about in terms of implementation are
the same as those encompassed by a broad definition of
management: promotion (marketing and advertising), public
relations, sales, employees, communications, legal issues,
plant and equipment, risk management, disaster planning,
crisis management, insurance, technology, computer systems,
taxes, bookkeeping, finance, and the internet.
PERSONAL QUALITIES
Equally important as the common issues shared by all
entrepreneurs are the personal qualities of the entrepreneur
him or herself. To start you thinking about whether you have
the right stuff to make a success of an entrepreneurial
venture, here's a list of character traits and work ethics
common to successful entrepreneurs. Although it is not
necessary that you possess all of them, you should possess
most:
=> Passion - entrepreneurs have a strong passion for their
idea or concept, so much so that their work is their play. If
you don't like what you do, you won't stick it out when
challenges come along, as they inevitably will.
=> Curiosity - entrepreneurs need to understand how things
work. They ask a lot of questions. Curiosity therefore triggers
innovation.
=> Sponges - entrepreneurs are sponges. They devour
information about their industry and are always current on
new and emerging trends and technologies, not only in
their specific industry but in closely related industries. This
habit of scanning their environment is a rich source of
discovery of new opportunities. Entrepreneurs are ALWAYS
looking for new markets, applications, products or twists on
an old concept.
=> Optimism - entrepreneurs think of problems as opportunities
for improvements and new ideas.
=> Forward looking - entrepreneurs are never satisfied with
the status quo and are always proactively carving out their future.
=> Careful about money - entrepreneurs are careful with money
and have a firm grasp on what things cost and their value to the
business. This allows them to recognize a true bargain when they
see one.
=> Started earning at a young age - entrepreneurs commonly
displayed entrepreneurial leanings as a teenager seeking out
entrepreneurial activities such as babysitting, lawnmowing and
lemonade stands.
=> Competitive - entrepreneurs are naturally competitive and
don't let the grass grow under their feet.
=> Time conscious - entrepreneurs know the value of time and
how to make the best use of it. You won't find entrepreneurs
spending much time on nonproductive activities. That said,
entrepreneurs typically also recognize the value of downtime and
time with family and will factor these activities into their schedule.
=> Risk takers - entrepreneurs are not afraid of taking calculated
risks. They typically trust their hunches and act on them.
=> Usually loners - entrepreneurs generally prefer a solitary work
environment as opposed to teamwork.
=> Professional - entrepreneurs are professional in their approach
to work. They operate as they would in a corporate environment
and don't allow themselves to be distracted by outside influences.
=> High energy - entrepreneurs have a plan and a vision and
they work it. Entrepreneurs are often health-conscious too,
recognizing that the fitter they are, the better their minds work. So
entrepreneurs will take time from their schedule to work out and eat
well.
=> Flexible - entrepreneurs are nothing if not responsive to change.
Although they appreciate the importance of having a plan and working
that plan, they allow themselves room to react and respond to
opportunities that may suddenly reveal themselves.
=> Nurture entrepreneurial spirit - entrepreneurs seek out and nurture
the entrepreneurial spirit in their employees and reward them
accordingly.
=> Confident goal-setters - entrepreneurs are confident and set long-term
goals, both for themselves personally and their businesses. They
view money and financial security as a measure of accomplishment
and a source of peace of mind.
=> Persistent - entrepreneurs never give up. They persist until they
succeed.
=> Learn from failure - entrepreneurs learn from their failures and those
of others. Failure to an entrepreneur is nothing more than an opportunity
waiting to be discovered.
=> Self responsibility - entrepreneurs take the initiative and personal
responsibility for their success or failure (which is always a merely
temporary state).
=> Resource utilization - entrepreneurs utilize ALL of their available
resources.
=> Internal locus of control - entrepreneurs don't believe in luck. They
firmly believe that success and failure lies within their personal
control or influence.
THE FUTURE OF ENTREPRENEURSHIP
As we all know, increasing numbers of people are electing to work
from home either through telecommuting or running home businesses.
While this trend has commonly been attributed to the growth in the
number of working women wanting to be home for their children, over
half of all people now working from home are men.
A recent Purdue University study concluded a number of factors seem
to favor continued high rates of new firm formation:
1. Continuing high rates of change (change creates opportunities for
new firms).
2. Continued growth of the service sector (the highest growth area for
new firm formation).
3. Increasing number of virtual corporations in which firms outsource
their functions, creating opportunities for entrepreneurs.
4. Positive climate for small business - a general perception that small
business is a positive influence on the economic wellbeing of the
country giving entrepreneurs legitimacy and respect.
5. Growth in international business opportunities.
With the traditional corporate-employment track seemingly on the
decline, the trend of forming strategic alliances with other businesses
that are closely aligned with yours or with someone who can add value
to your product is emerging. In fact, futurists envision a return to
extended community living with shared resources but individual living
and working relationships with entrepreneurial activities being the basis
of these communities. Strategic alliances are a first step along this
path.
So, if you have determined entrepreneurship is for you, you can be
confident that you are part of the wave of the future. But understand
what it will demand of you and whether you are prepared to give what
it will take. The allure of entrepreneurship is undeniably strong for many
but make sure you're going into it for the right reasons. Being miserable
in your job does not automatically make starting your own business the
best idea in the world. In fact, it could be the worst reason of all to get
into business for yourself. The right choice may instead be to find another
job that you won't be miserable in. But if, taking into account everything
that's been said above, you're adamant that you have what it takes,
by all means take the bull by the horns and create something
absolutely fabulous.
This phenomenon is by no means restricted to North America. The
leading country for entrepreneurship is Brazil with one in eight adults
an entrepreneur. Australia is not far behind the U.S. with one in twelve.
These countries - Brazil, the United States and Australia - lead the
way. Contrast, for example, Germany (one in 25), the United Kingdom
(one in 33), Finland and Sweden (one in 50) and Ireland and Japan
(less than one in 100). (Source: Global Entrepreneurship Monitor
2000.)
ENTREPRENEURSHIP DEFINED
The Global Entrepreneurship Monitor 1999 defined entrepreneurship
as "any attempt at new business or new venture creation, such
as self-employment, a new business organization, or the
expansion of an existing business, by an individual, a team
of individuals, or an established business."
ENTREPRENEURIAL ACTIVITY - AN HISTORICAL PERSPECTIVE
Entrepreneurship is a major contributing factor to the economic
well-being of a country both in terms of economic growth and
job creation. Traditionally, entrepreneurial ability tended to focus
on the following four attributes:
=> Initiative - the entrepreneur takes the initiative to bring together
the economic resources of land, labor and capital to produce a
commodity (whether a good or a service) with the hope that
such production will create a profitable business venture.
=> Decision-making - the entrepreneur makes the basic business
policy decisions for the business, thereby setting the course of
the enterprise.
=> Innovation - the entrepreneur is an innovator, attempting to
introduce new products and new ways of doing things.
=> Risk-taker - the entrepreneur risks his or her time, effort,
business reputation and invested funds in the entrepreneurial
venture.
THE MODERN ENTREPRENEUR
Until recently, the above attributes, especially innovation and
risk-taking, were the dominant factors that defined the
characteristics of those who chose to become entrepreneurs.
Now, however, with corporate downsizing being a fact of life,
many entrepreneurs find themselves thrust into the role by
default.
The question for anyone either finding themselves in this position
involuntarily or thinking about leaving corporate life for the heady
world of entrepreneurship is whether you have what it takes to be
successful ... the "right stuff" in other words. Some people do, in
spades. Others simply don't. If you're one of the ones who just
doesn't, either resign yourself to working for someone else or
cultivate in yourself the qualities that successful entrepreneurs
share. Believe it or not, entrepreneurs are not just "born". Well,
some, of course, seem to be natural-born entrepreneurs, but
for the rest of us, the qualities of entrepreneurship can definitely
be acquired by hard work and application.
COMMON ISSUES
The "common denominator" issues facing all entrepreneurs
are planning, finance and implementation.
=> Planning
All entrepreneurs face the challenge of starting a new business,
be it through innovation (inventing something new or doing
something a different way), finding the right opportunity to
get into, or buying a franchise. Whichever road you choose,
it will involve serious planning.
=> Financing
Unless you have ready funds at your disposal, getting finance
is the next major challenge and cannot be attempted until
your business plan is in place. You will need to prepare
funding proposals and applications for loans, venture capital,
and funds from angel investors.
=> Implementation
This is make or break time. Many people think just getting
started is the hard part - and it is hard. But where many
businesses stumble is not in the planning and financing
stages but in implementing their business plan. Why this is
so is not certain. There are various hypotheses including the
idea that ideas people and implementation people are two
very different breeds and it is highly unusual to find one person
who can do both. More likely though, is the simple fact that
implementation requires such a broad range of skills that
no one person can possibly be adept at all of them.
The real challenge and skill of the entrepreneur, then, is to
recognize what you do well and then appoint employees
or subcontractors to do the rest. Of course, if you're running
a business on a shoestring, this simply may not be possible!
So be brutally honest and objective in assessing your particular
strengths and weaknesses BEFORE you cash in your day
job and your 401K.
The areas to think about in terms of implementation are
the same as those encompassed by a broad definition of
management: promotion (marketing and advertising), public
relations, sales, employees, communications, legal issues,
plant and equipment, risk management, disaster planning,
crisis management, insurance, technology, computer systems,
taxes, bookkeeping, finance, and the internet.
PERSONAL QUALITIES
Equally important as the common issues shared by all
entrepreneurs are the personal qualities of the entrepreneur
him or herself. To start you thinking about whether you have
the right stuff to make a success of an entrepreneurial
venture, here's a list of character traits and work ethics
common to successful entrepreneurs. Although it is not
necessary that you possess all of them, you should possess
most:
=> Passion - entrepreneurs have a strong passion for their
idea or concept, so much so that their work is their play. If
you don't like what you do, you won't stick it out when
challenges come along, as they inevitably will.
=> Curiosity - entrepreneurs need to understand how things
work. They ask a lot of questions. Curiosity therefore triggers
innovation.
=> Sponges - entrepreneurs are sponges. They devour
information about their industry and are always current on
new and emerging trends and technologies, not only in
their specific industry but in closely related industries. This
habit of scanning their environment is a rich source of
discovery of new opportunities. Entrepreneurs are ALWAYS
looking for new markets, applications, products or twists on
an old concept.
=> Optimism - entrepreneurs think of problems as opportunities
for improvements and new ideas.
=> Forward looking - entrepreneurs are never satisfied with
the status quo and are always proactively carving out their future.
=> Careful about money - entrepreneurs are careful with money
and have a firm grasp on what things cost and their value to the
business. This allows them to recognize a true bargain when they
see one.
=> Started earning at a young age - entrepreneurs commonly
displayed entrepreneurial leanings as a teenager seeking out
entrepreneurial activities such as babysitting, lawnmowing and
lemonade stands.
=> Competitive - entrepreneurs are naturally competitive and
don't let the grass grow under their feet.
=> Time conscious - entrepreneurs know the value of time and
how to make the best use of it. You won't find entrepreneurs
spending much time on nonproductive activities. That said,
entrepreneurs typically also recognize the value of downtime and
time with family and will factor these activities into their schedule.
=> Risk takers - entrepreneurs are not afraid of taking calculated
risks. They typically trust their hunches and act on them.
=> Usually loners - entrepreneurs generally prefer a solitary work
environment as opposed to teamwork.
=> Professional - entrepreneurs are professional in their approach
to work. They operate as they would in a corporate environment
and don't allow themselves to be distracted by outside influences.
=> High energy - entrepreneurs have a plan and a vision and
they work it. Entrepreneurs are often health-conscious too,
recognizing that the fitter they are, the better their minds work. So
entrepreneurs will take time from their schedule to work out and eat
well.
=> Flexible - entrepreneurs are nothing if not responsive to change.
Although they appreciate the importance of having a plan and working
that plan, they allow themselves room to react and respond to
opportunities that may suddenly reveal themselves.
=> Nurture entrepreneurial spirit - entrepreneurs seek out and nurture
the entrepreneurial spirit in their employees and reward them
accordingly.
=> Confident goal-setters - entrepreneurs are confident and set long-term
goals, both for themselves personally and their businesses. They
view money and financial security as a measure of accomplishment
and a source of peace of mind.
=> Persistent - entrepreneurs never give up. They persist until they
succeed.
=> Learn from failure - entrepreneurs learn from their failures and those
of others. Failure to an entrepreneur is nothing more than an opportunity
waiting to be discovered.
=> Self responsibility - entrepreneurs take the initiative and personal
responsibility for their success or failure (which is always a merely
temporary state).
=> Resource utilization - entrepreneurs utilize ALL of their available
resources.
=> Internal locus of control - entrepreneurs don't believe in luck. They
firmly believe that success and failure lies within their personal
control or influence.
THE FUTURE OF ENTREPRENEURSHIP
As we all know, increasing numbers of people are electing to work
from home either through telecommuting or running home businesses.
While this trend has commonly been attributed to the growth in the
number of working women wanting to be home for their children, over
half of all people now working from home are men.
A recent Purdue University study concluded a number of factors seem
to favor continued high rates of new firm formation:
1. Continuing high rates of change (change creates opportunities for
new firms).
2. Continued growth of the service sector (the highest growth area for
new firm formation).
3. Increasing number of virtual corporations in which firms outsource
their functions, creating opportunities for entrepreneurs.
4. Positive climate for small business - a general perception that small
business is a positive influence on the economic wellbeing of the
country giving entrepreneurs legitimacy and respect.
5. Growth in international business opportunities.
With the traditional corporate-employment track seemingly on the
decline, the trend of forming strategic alliances with other businesses
that are closely aligned with yours or with someone who can add value
to your product is emerging. In fact, futurists envision a return to
extended community living with shared resources but individual living
and working relationships with entrepreneurial activities being the basis
of these communities. Strategic alliances are a first step along this
path.
So, if you have determined entrepreneurship is for you, you can be
confident that you are part of the wave of the future. But understand
what it will demand of you and whether you are prepared to give what
it will take. The allure of entrepreneurship is undeniably strong for many
but make sure you're going into it for the right reasons. Being miserable
in your job does not automatically make starting your own business the
best idea in the world. In fact, it could be the worst reason of all to get
into business for yourself. The right choice may instead be to find another
job that you won't be miserable in. But if, taking into account everything
that's been said above, you're adamant that you have what it takes,
by all means take the bull by the horns and create something
absolutely fabulous.
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