Is Starting Your Own Business Right for You?

For many women, life is a roller coaster of organising their families and still managing a demanding job. You may have often considered how much easier things would be if you could be your own boss, with no more worries about how to cope when the kids are off school or stressing about having to work late. Those aren’t good enough reasons on their own to consider self-employment, so if you want to determine whether this is a viable option for you, have a serious think about what you want to do, why you want to do it and how you could achieve it.

Your motivation

Working for yourself might sound like the answer to reducing your stressful schedule, but it comes with its own share of stresses and pressures, and you need to be sure you can handle them. If you have a great idea for a business, having spotted a gap in the market or a business model that matches your skills such as a franchise or agency role, you will have a lot of work to do preparing your business plan.

You will need to do some diligent research to make sure your idea is viable and likely to be profitable, and that is likely to involve conducting some market research to test the waters. If you’re developing a new product, that will require extensive input and testing, and you’ll have to meet certain consumer safety standards; plus there will be packaging design, production methods, sourcing, and marketing to put in place. All this will take a considerable investment, so you may well need outside financing, which means being able to persuade banks or private investors of the merits of your business proposal.

If you’re feeling exhausted at the very thought of all this, it’s probably going to be a stressful and overwhelming experience; however, if you’re feeling fired up and full of ideas, chomping at the bit to get going, you’ll stand a much better chance of success.

Business or self-employment?

These are essentially two sides of the same coin, but people tend to think of self-employment as someone working on their own, and a business owner as someone with premises and staff. Your business idea may be more appropriate for a sole trader working from home, at least to start with. For example, say you have a talent for making pottery figurines and want to earn your living selling them. To start with, you need somewhere at home to work, do your admin and store your products. Then you need to have sufficient capital to buy the raw materials you’ll need and start marketing yourself. That represents a far less onerous level of investment than leasing premises in which to start your business.

So, the answer may be to think smaller, and build up to a bigger business in the future. Your journey to becoming a business owner could start with working from home in the first instance, where you can get used to being autonomous and develop your business plan as you continue to earn money. That way you will find out if self-employment would work for you, or whether you need the structure of a job working for someone else.

Preparing the way

Before you get too excited about the prospect of being self-employed, there are a few things to work out. First of all, your personal finances. Do you have savings that can act as a buffer in the early days where work might be slow coming in? If not, or if they are insufficient for your needs, would you be able to get a loan? Your money management history will be a crucial part of your initial enquiries and plans, for two reasons.

Firstly, if you have a poor credit score or a history that reflects missed payments and financial difficulties, that is going to make it harder to find finance. One of the best ways to rebuild your credit score is not to stop using credit, but to show you can use it wisely. Credit brokers like Bonsai Finance can point you towards the best cards to get, which you can then use to show you are able to make your repayments and not overstretch yourself. The other aspect of your financial management history is the insight it gives you personally into how well you can keep accounts and balance the books. If you have problems in this regard, you need to prove to yourself that you have the ability to cope with the complex finances of business before taking the plunge.

Scaling your business

Whatever you do as a self-employed person is still a business, regardless of the nature of the work or the level of capital required. You could work as a writer for example, for which you need little more than a laptop and an Internet connection. If you are only looking to earn the equivalent of your salary as an employee, then this set-up will be perfectly adequate. However, to develop your business from simply working from home requires something called scaling. That means making more money from the same, or even fewer, hours work. Taking the example of a writer or business coach, initially that would involve increasing your hourly rates as your experience and reputation grew. There will come a point with this model where you have reached the upper limits of your capacity for work and the amount clients are willing to pay. To expand your business and increase your revenue, you then need to look at the products you can sell which will earn you money repeatedly for a single initial investment, like an eBook or webinar for example.

Working for yourself isn’t right for everybody, and you need to be sure that you have the right frame of mind and the skills required to make it work. You’ll also find that although you will have a degree of freedom, you could well be working longer hours when you work for yourself. If you still feel inspired and undaunted by the prospect, it looks like you’re ready to start your journey to business ownership.