At some point in our lives, most of us have considered owning our own business. In fact, I can think of few things more satisfying than being your own boss, with your own rules and schedule. Such thoughts are what push people to explore the idea of starting a business built around something they truly love. But it’s not enough to be passionate: You need to know how to execute your idea so it leads to profitability.
EMOTIONAL COMMITMENT Whether you’re developing the next big technology or have simply identified a service gap, starting your own business can be extremely rewarding, exhilarating—and frightening. The biggest hurdle most people face is the emotional commitment required. It’s like a relationship: If you’re not ready, you can get hurt—or in this case, your business will suffer.
When looking at risk, it’s important to make intelligent decisions while considering all variables. Don’t be blinded by the dollar signs and glamour of being a business owner. By taking the plunge, you not only give up a steady paycheque and vacation time but potentially health benefits and life insurance—at least until you’ve gotten established.
TIMING Ask yourself, Is now a good time? Are you starting a family, for example? Be realistic about your goals and the time frame it will take to achieve them. Under-estimate and over-prepare. Your business will become your baby and will need nurturing and time to become successful.
RESEARCH The timing may be right, but what about the market? Do your research to learn where the gaps are in the market. You might have a brilliant idea and the tools to make it work, but what if the marketplace isn’t ready? One of the best ways to explore the marketplace is to hit the pavement; look at existing businesses in the area and related fields. Most owners love to talk about their businesses. Learn from their success but, more important, learn from their mistakes.
FINANCIAL COMMITMENT Once you’ve researched the market, take that knowledge to the expert. The person you’ll want to talk to most during this entire process will be your business advisor. The relationship with him or her should be like a marriage: Discuss your concerns, ambitions and how you see the business growing. Leverage the advisor’s knowledge to develop an effective business plan that should include these key elements: objectives, goals, key milestones and how to achieve them—and don’t ever be afraid to ask for advice when needed.
Financing can be difficult. Prepare for the upfront expenses and have a backup plan for unexpected costs. As the saying goes, you have to spend money to make money, but that doesn’t mean liquidating your life savings. Assess your credit options and the documents and security required to get that credit set up.
Your plan should also outline how the business fits into your retirement and overall future financial picture. Perhaps you’ve given up that pension and RSP benefit package from your previous employer—what will you do to supplement that income?
MARKETING How will you market your product to the world? Branding strategies can make or break a business. Create a simple and clear brand that conveys your “value-added” message to the consumer. And don’t forget media: Digital marketing has become crucial. These days, don’t we all Google a product or service to learn about it and evaluate its reviews? Your digital footprint now becomes that all-important “first impression”—it’s no longer personal touch. So your online component needs to WOW potential clients, or it could mean lost revenues. That digital strategy brings people in the door, allowing you to step up and give the legendary customer service that’s now expected.
CONCLUDING THOUGHT Becoming self-employed isn’t right for everyone and can be a scary decision to make. There will be peaks and valleys as you grow your business. But if you do your homework and cover all your bases, you’ll be taking a calculated risk that can be very rewarding!
For a comprehensive overview on how to start a business and create a business plan, visit www.tdcanadatrust.com/products-services/banking/index-banking.jsp.
A noteworthy agency offering help to new-business owners (ages 18-39) is Futurpreneur, www.futurepreneur.ca,
formally known as the Canadian Youth Business Foundation. It provides mentoring and loans, partnered with Business Development Bank of Canada.
Al Ramsay is TD Bank Group’s regional manager, LGBTA Business Development. You can reach or follow him on Twitter, @AlRamsay_TD. Contributing to this column were two Small Business Advisors on his team: Marjan Tehrani, Marjan.Tehrani@td.com; and Luke Girard,Luke.Girard@td.com.