Business Archives - Page 21 of 52

Small Business Start Up Financing

The number one question I get asked as a small business start-up coach is: Where do I get start-up cash?

I’m always glad when my clients ask me this question. If they are asking this question, it is a sure sign that they are serious about taking financial responsibility for start it.

Not All Money Is the Same

There are two types of start-up financing: debt and equity. Consider what type is right for you.

Debt Financing is the use of borrowed money to finance a business. Any money you borrow is considered debt financing.

Sources of debt financing loans are many and varied: banks, savings and loans, credit unions, commercial finance companies, and the U.S. Small Business Administration (SBA) are the most common. Loans from family and friends are also considered debt financing, even when there is no interest attached.

Debt financing loans are relatively small and short in term and are awarded based on your guarantee of repayment from your personal assets and equity. Debt financing is often the financial strategy of choice for the start-up stage of businesses.

Equity financing is any form of financing that is based on the equity of your business. In this type of financing, the financial institution provides money in return for a share of your business’s profits. This essentially means that you will be selling a portion of your company in order to receive funds.

Venture capitalist firms, business angels, and other professional equity funding firms are the standard sources for equity financing. Handled correctly, loans from friends and family could be considered a source of non-professional equity funding.

Equity financing involves stock options, and is usually a larger, longer-term investment than debt financing. Because of this, equity financing is more often considered in the growth stage of businesses.

7 Main Sources of Funding for Small Business Start-ups

1. You

Investors are more willing to invest in your start-up when they see that you have put your own money on the line. So the first place to look for money when starting up a business is your own pocket.

Personal Assets

According to the SBA, 57% of entrepreneurs dip into personal or family savings to pay for their company’s launch. If you decide to use your own money, don’t use it all. This will protect you from eating Ramen noodles for the rest of your life, give you great experience in borrowing money, and build your business credit.

A Job

There’s no reason why you can’t get an outside job to fund your start-up. In fact, most people do. This will ensure that there will never be a time when you are without money coming in and will help take most of the stress and risk out of starting up.

Credit Cards

If you are going to use plastic, shop around for the lowest interest rate available.

2. Friends and Family

Money from friends and family is the most common source of non-professional funding for small business start-ups. Here, the biggest advantage is the same as the biggest disadvantage: You know these people. Unspoken needs and attachments to outcome may cause stress that would warrant steering away from this type of funding.

3. Angel Investors

An angel investor is someone who invests in a business venture, providing capital for start-up or expansion. Angels are affluent individuals, often entrepreneurs themselves, who make high-risk investments with new companies for the hope of high rates of return on their money. They are often the first investors in a company, adding value through their contacts and expertise. Unlike venture capitalists, angels typically do not pool money in a professionally-managed fund. Rather, angel investors often organize themselves in angel networks or angel groups to share research and pool investment capital.

4. Business Partners

There are two kinds of partners to consider for your business: silent and working. A silent partner is someone who contributes capital for a portion of the business, yet is generally not involved in the operation of the business. A working partner is someone who contributes not only capital for a portion of the business but also skills and labor in day-to-day operations.

5. Commercial Loans

If you are launching a new business, chances are good that there will be a commercial bank loan somewhere in your future. However, most commercial loans go to small businesses that are already showing a profitable track record. Banks finance 12% of all small business start-ups, according to a recent SBA study. Banks consider financing individuals with a solid credit history, related entrepreneurial experience, and collateral (real estate and equipment). Banks require a formal business plan. They also take into consideration whether you are investing your own money in your start-up before giving you a loan.

6. Seed Funding Firms

Seed funding firms, also called incubators, are designed to encourage entrepreneurship and nurture business ideas or new technologies to help them become attractive to venture capitalists. An incubator typically provides physical space and some or all of these services: meeting areas, office space, equipment, secretarial services, accounting services, research libraries, legal services, and technical services. Incubators involve a mix of advice, service and support to help new businesses develop and grow.

7. Venture Capital Funds

Venture capital is a type of private equity funding typically provided to new growth businesses by professional, institutionally backed outside investors. Venture capitalist firms are actual companies. However, they invest other people’s money and much larger amounts of it (several million dollars) than seed funding firms. This type of equity investment usually is best suited for rapidly growing companies that require a lot of capital or start-up companies with a strong business plan.

Starting Your Business: Avoiding the "Me Incorporated" Syndrome

Many people who want to start a business have similar reasons for their ambitions. Typically, they are seeking autonomy from an employer, freedom, or control over their own destiny, which also means that they can determine their own income, work schedule, job duties, and career trajectory. However, upon launching a business, it becomes immediately apparent as to why many entrepreneurs describe their position as that of “chief cook and bottle washer.” This is another way of saying–in the absence of anyone else to address all of the major and minor tasks that must be accomplished to run the business–it is the entrepreneur who him or herself, must do everything.

Sweeping the floors, taking out the trash, wiping counters, answering phones, taking care of customers, packaging, shipping, invoicing, receiving, repairs, handling the bookkeeping, marketing: performing these tasks as well as anything else that must be done, is all in a day’s work for the entrepreneur. The entrepreneur becomes a jack of all trades and also falls into a trap. This scenario bodes well for a prediction: The business will never grow. This is because at the onset–when the entrepreneur’s imagination should have been running wild with “blue sky” possibilities surging through his or her head–there was only one overarching compulsion, which was to rush forward and print the title “President” on the entrepreneur’s new business cards. The entrepreneur was already afflicted with the “Me Incorporated” syndrome.

The job description above also explains why some displaced corporate executives who start businesses are completely unprepared for their new roles as business owners. Now they have to do everything; but, they were trained as specialists who operated in silos. They never had to clean the toilet or polish the brass handrails at “Behemoth Worldwide.” Their jobs there did not prepare them for survival in the “mean streets of Entrepreneur Town.” They can’t deal with the ambiguity and uncertainty that surrounds entrepreneurs, who must create their own destiny and fly without a manual. Their jobs were about keeping their mouths shut, fitting in, and saying, “Yes, boss–that’s a great idea [which you stole from me, you wheezing, blundering, conniving, drooling…idiot].”

Lest I go on into a full fledged rant about oversized corporations and the drone-like behavior that they seem to thrive on (not to mention ethical breaches and other shenanigans), let me stop right here and get back to the primary theme of this article. Suffice it to say that you want to start your own business, and you have your own reasons.

Given that I have explained the outcome of the “Me Incorporated” syndrome, it would be appropriate for me to discuss cause and effect, so that the affliction can be avoided. Let’s start with how you should think about your business in the beginning. Now hang in there with me folks, I’m going to be talking about imagination, crayons, scissors and paste, and being considered just a bit on the edge for a few moments.

Prior to starting a business, there are no restrictions as to the thoughts that you are entitled to have. When you are in the planning stages, it’s no time to squelch anything that pops into your head. There will be plenty of time for you to confront impediments after you start the business. Feel free to doodle, draw, color, paint, cut out shapes, and assemble anything that you wish. Draw other people a picture that’s clear as a bell and show them what you are made of. It’s your vision. Make it big and bold, and throw in a dash of pure crazy colored sugary sprinkles. Many phenomenally successful inventions were created by people who were proven to be geniuses instead of lunatics, only that was after they became successful.

As an example, let’s suppose that you imagined, instead of one sandwich shop, starting a chain of sandwich shops throughout a city. These shops could benefit from efficiencies of scale. Did you know that anything that you have printed, such as napkins, menus, cups, and sandwich wrappers in this instance, is cheaper in larger quantities? If you print 1000 of something, for a few dollars more, you could probably have printed 2500. Most things are “cheaper by the dozen.”

A few other examples of efficiencies are well worth mentioning here, so that your imagination becomes fully engaged. I once serviced a group of franchised business owners who wanted to collaborate and purchase advertising, acting together, instead of separately. First, I helped them write a cooperative agreement. You should know that even though they each provided the same services, realistically, customers would do business with the franchise owner whose store was closest. In other words, customers who were located downtown did business with the downtown store; customers who were located on the east side of town did business with that store, and so on. Technically, these stores competed with one another, but not really.

The store owners purchased a large advertisement in the yellow phone directory, and they split it up so that they had plenty of room to promote not only their individual locations, but also their brand name, and the features and benefits associated with their services. Any given single location could not have afforded to get all of that across; acting as a group of stores, they could.

The majority of all advertising is local advertising. Mom and pop companies advertise to consumers in their own respective market areas. Your single sandwich shop, acting all by itself, just about definitely cannot afford television advertising. However, with five or ten stores in a city, a chain of sandwich shops probably can. TV might be a great medium for featuring the satisfied faces of customers who are consuming your delectable culinary creations–if only your vision had called for that. Purchasing supplies, advertising, food, and anything else can probably be accomplished more efficiently when you are acting on behalf of several stores.

Let’s talk about personnel, too. Instead of rushing to become President, you should think about becoming CEO. In that role, your job is to be the visionary, and the team builder. “What are the qualifications for becoming a successful store manager?” is the question you should be asking. In case you haven’t followed my leap of reasoning–you need ten such store managers in our hypothetical scenario. You are the CEO, remember? Your role is to hire and motivate, compensate, and grow the overall enterprise. Your primary responsibilities are to plan, to confer with other team leaders, take the pulse of the markets in which you operate, understand the economy, and to fulfill the unmet needs of customers. As an entrepreneur, by definition, fulfilling unmet needs is what you are in business to do.

“Where do I get the money?” you may ask. Did you ever think about the fact that you can “sell” the notion of a bigger return on investment more effectively when you are wielding a more imaginative, stronger plan? Many small businesses, afflicted by the “Me Incorporated” syndrome as they are, will do nothing more than struggle and exhaust their owners, who are doing too much, for too long, for too little. Eventually, both the businesses, and the owners will submerge beneath the waters of insolvency and sink to the bottom of the entrepreneurial sea–or they will be eaten alive by larger, better adapted predators.

It is just as easy to say, “All I need is nine-hundred-and-seventy-three thousand dollars to underwrite the opening of ten highly competitive, efficiently run, strongly promoted, professionally managed sandwich stores” as it is to say, “Mom, dad, I was hoping that you could lend me two-thousand bucks for first and last month’s rent on a ‘sandwish’ shop.” No, it’s not a typo. I meant to say “sandwish” shop, because that’s what it is. It’s an uncertain proposal on the part of an unimaginative would-be entrepreneur, who has already demonstrated a lack of foresight or an ability to think beyond him or herself. It’s one thing to bootstrap a business startup, but it’s another thing altogether to proceed without any of your creative juices flowing. If you think “me, me, me,” all of the time, then you won’t think about sharing the work, sharing the profits, or building a team.

No, you’ll do it all yourself. No thanks to all of the other people who have let you down. There’s nobody who can make a “sandwish,” any better than you can. Nor can they run the cash register, accept a delivery, or do anything else as well as you can. “Oh, baby, baby, you are the best!”

To avoid the “Me Incorporated” syndrome, you need to create strategic and tactical plans representing your solutions for recruiting, hiring, training, developing, compensating, and retaining personnel. You need to have external resources lined up to accomplish what is not done in-house. You need a detailed marketing plan, to include the product, pricing, publicity, advertising, facilities, delivery, and customer satisfaction processes that you will utilize. Similarly, you need a financial plan, an operations plan, a technology plan, and contingency plans to manage business interruptions and risk. Whatever you were planning to write down, just add zeros, because that’s what it costs to start a real business and run it right, so that everyone gets their money back, along with a profit.

You will probably not have time to do all of this planning after you are overwhelmed with the responsibilities of handling every aspect of running your business all by yourself. It will be too late by then, for you will already be trapped in a quagmire.

Before you take the entrepreneurial plunge, decide what kind of business you want to create. If you ask for something bigger, and justify it, you may just have a chance of making it happen. What’s the alternative? You’ll be in charge of your own tiny little fiefdom, never knowing how things could have been, if you had only thought a little longer, a little harder, a little bigger, and a little less about how you could do every little thing all by yourself, either scheming to keep all of the profits, or avoiding reality thinking that you could wing it forever.

Put that “sandwish” down and think beyond what you can do yourself, and focus on what you can imagine. The transcontinental railroad that spans the United States was built one railroad tie at a time, but it was always the plan to connect the East Coast, with the West Coast (and a larger part of this vision was to connect the East Coast with goods shipped by merchants from places such as China and India). If you can envision, articulate, sell, and implement a business concept that entails serving, employing, partnering, leading, and uplifting others, you are probably cured.

The Art of Planning a Business: How to Make Money

Entrepreneurship, in today’s world, does not need huge capital or a highly qualified team to start with. The Internet has opened up ways for people to start without investments, and to hire people with expertise on a need basis. Almost all aspects of running a business can be outsourced, while the owner can keep a brief overview of everything and ensure control over everything.

The starting point to create a successful business is to create a plan. A business plan contains your aims, objectives, an executive summary of what you intend to do, how you intend to do, and a complete analysis of the revenues you expect to make in the coming years. The goal of a business plan is to find out the time you are supposed to break even and make profits – thus determining the viability and feasibility of your business. With angel investors looking to invest money on businesses with promising ideas, a good business plan is essential to attract these investors.

However, not everyone has the required skill-set to create an effective business plan even after having all the required ingredients to it. Therefore, people are now looking to hire freelancing business experts who can create a business plan for them based on the requirements and data that have been gathered. This is a great way to earn income in case one has the required skill-set to create proper plans for business.

More often than not, business planners also provide expertise over the ideas provided to them by their clients. With experience, one can easily gauge the viability of certain aspects of business, and providing consultancy over such matters increase your value, and the income from the project. Generally, clients choose business planners from freelancing websites, which is done based on the qualifications portrayed. A degree in business administration is one way to attract clients into awarding you with their projects.

Every business has its own template of business plan, and while creating one, it is extremely important to stick to the standard format of the plan in order to be considered by venture capitalists. While the information is generally provided by the client, it is the duty of the planner to ask for any data that might be required to create a good business plan.

The charges for creating a business plan varies based on several factors like the complexity of the business, the expertise of the planner and the deadline provided among others. If one can create a name for oneself, there are several projects available online, which can help you earn an handsome extra income for yourself.

Women Entrepreneurs: How To Make Your Business A Success

With entrepreneurship holding out the promise of a lucrative future, together with the freedom to be your own boss, many women are choosing to walk the road to free enterprise rather than stay in dead end jobs. Research has shown that twice as many women as men opt out of corporate jobs to start their own business.

Advantages of Starting Your Own Business:

1) Earlier, women were expected to work towards the goals of their organization without considering their own professional satisfaction. Now, more and more women are discovering the joys of being their own boss.

2) As the boss of your own organization, you have more flexibility about setting corporate goals.

3) As a woman entrepreneur, you need not worry about any glass ceiling that may hamper your professional growth.

4) You get to earn more as an entrepreneur.

5) Your contributions will be valued more when you run your own business.

What Makes Women Entrepreneurs Successful

The world over, business analysts are sitting up and taking note of the contributions women entrepreneurs are making to the economy. Entrepreneurship used to be a male bastion, and the glass ceiling in corporate sector is driving many women away. Therefore, an increasing number of women are choosing to leave their corporate jobs and start their own businesses.

Here are some startling facts about women entrepreneurs:

1) Women start more companies than men do.

2) A third of women who left their jobs to become successful entrepreneurs said their employer did not take them seriously.

3) 51 percent of women left corporate jobs because of lack of flexibility.

4) In the US, women own 28 percent of small businesses.

5) Women entrepreneurs in the US employ a little over 9 million people and earned $3 million in revenues for the US in 2005.

Groups for Women Entrepreneurs:

Many organizations support the growth of women entrepreneurs. You can join groups like Women in Entrepreneurship that aim to train women entrepreneurs and provide them with resources.

Women Entrepreneur Groups: Advantages of Joining;

Some of the advantages of joining groups for women entrepreneurs include:

1) Opportunity to share experiences and network with other women entrepreneurs.

2) Get updates on workshops, seminars, trade shows etc.

3) Have access to a directory listing of women entrepreneurs.

4) Participate in competitions for women entrepreneurs.

Women entrepreneurs can also avail grants and loan programs run by many federal, state and private agencies. With more and more women starting their own businesses, the number of grants and loans allocated to them has also gone up. If you are a woman entrepreneur and need to know more about funds, business plans, and organizations that help women entrepreneurs, you can consult a small business expert.

2 Simple Steps Before Starting Your Business

There is so much small business information available today that it’s easy to be bogged down by the sheer volume of it all. Where does one start? Well, it’s safe to say not all the information you’ll receive will be of equal value. So it’s important to be discerning when you’re thinking about applying any suggestions to your new business. In many cases, you’ll find some suggestions don’t match your business type, management style, budget, or industry. This could lead to wasted dollars spent and time lost. So learning how to research and compile information will be key in developing a plan that is tailored to fit your business needs.

What I suggest is a methodical and basic approach to starting your business. No matter what the industry, in most cases, these two initial steps will always be the same.

Take a crash course in small business. There is no better place to start then http://sba.gov. Not only will you find dozens of free tutorials on business planning and managing but you will also find important information regarding legalizing your business in respect to your location and your industry. In addition, you will find links to other leading small business sites and resources. Visit the site and remember to bookmark this page. Try to develop a schedule and visit the site on a regular basis to familiarize yourself with small business ownership and all its related issues, regulations, requirements, and rewards.
Network with other small business owners. Join community websites specifically geared towards small business owners so you can find solutions to common problems such as time management and financing. It’s also the best way to build a support system while you are planning to launch your business. Some entrepreneurs give up because they feel they are going at it alone! But there are so many other people out there going through the same challenges and are more than happy to assist you.

Don’t let your confusion or the amount of information available overwhelm you into paralysis. Once you’ve gained knowledge on how to become a successful entrepreneur don’t stop there. Each day try to work more and more towards formalizing your plans. And don’t be afraid to ask for help. Remember, you’ve got a lot of work ahead of you but these first two steps will ensure you don’t head into entrepreneurship ill-prepared.

How Entrepreneurship Training Programs Help You Excel in Your Business

Have you shunned the 9 to 5 job and ventured into a business to become your own boss? This will probably be one of the most tumultuous times you’ve ever had. There are myriads of aspects that need to keep track of, such as how to raise funding, creating the right team and ensuring your paper work is in order. Even a small slip up could result in disaster.

Why Entrepreneurship Training

Entrepreneurship comes with more baggage than you would expect. From developing a logo to selecting a financial planner, a lot requires to be grasped and executed simultaneously to succeed in commercial endeavors. The order and pattern of things could be specifically tough to comprehend if you are a novice entrepreneur. Here comes entrepreneurship training that can enable you handle the business of doing business in a better way. If you already own a business, then also entrepreneurship training can enable you get more efficient, by bridging any gaps there might be in the way you run your show.

How to Find One

Most training program packages offer many modules spanning from personal finance to business strategy.

Entrepreneurship courses and trainings are generally offered at vocational schools, business schools, and often online schools. Training can include a broad array of classes to aid the dreams of initiating and running a successful new enterprise.

What Entrepreneurship Training Program Offers

If you are planning on venturing into a new business, or are contemplating the purchase of an existing business, vocational schools could be a prudent option to gain entrepreneurship education. Studies will encompass training in business management. Students will learn the nitty-gritty of cost, benefit and competitive assessment; investment returns; legal aspects; e-commerce; marketing and sales; supply and demand; and prevalent tax laws.

To the aspiring entrepreneur, a college degree alone cannot ensure success on the world’s business stage; but right education in entrepreneurship can enable you to better comprehend the business aspects of smoothly operating a new venture, and how to capitalize on intrinsic talents and learned skills.

Who Should Opt for Entrepreneurship Training Programs

Additionally, entrepreneurship training is of essence to those who will ultimately be hiring and developing a winning team of performers. After completion of course of study, you will not only be able to effectively ascertain which candidate will be most productive for you and your business, but you will also be able to realize how to efficiently manage, finance, and launch your small business; identify new and potential business enterprises; and design strategic business plans.

Entrepreneurial Thinking – Connect With Your Higher Business Potential

When you think of a successful entrepreneur your immediately think of personality traits or values that define who they are. Richard Branson is associated with fun. Anita Roddick was an environmentalist. Steve Jobs lived by simplicity. Each one of these evokes an emotional connection with what they were good at (Richard still is).

So what is an entrepreneur? What is entrepreneurship? There are many definitions, but the one that rings true to me is that of Peter Drucker

“This defines entrepreneur and entrepreneurship – the entrepreneur always searches for change, responds to it, and exploits it as an opportunity.”

Does this ring true with you? Do you aspire to think like an entrepreneur?

Here are five features of entrepreneurial thinking based on my work with clients who I mentor to shift their own internal barriers to move on to create incredible change. If you are a business owner and are stuck in a rut, use these strategies to break through the chains that are holding you back:

1. Have a goal and a plan – and work on it

Make sure that your goal is as specific as you can get it. If your goal is to increase your income, be specific about how much. Decide your time frame – when you want your goal to be achieved by. Create your plan to achieve your goal and get started. Don’t procrastinate. If your plan isn’t going the way you want it, don’t give up. The secret is to have a plan. The content of the plan may change, you will make corrections as you go along, but as long as you persist on a regular basis, you will reach your goal. It may be uncomfortable at first. You may feel that you’re not making progress, but after a time things will start happening very quickly to help you reach your goal. Persistence works.

2. Get over your limiting beliefs

It’s very likely that the one thing that is stopping you from achieving what you want to do is YOU. Your attitudes and behaviours are influenced by your self-belief. Stop and listen to the voice in your head. Is it negative, telling you you’re not good enough, or that you can’t afford xyz? Where is that coming from? When you face a problem, sit down and try to write down as many reasons as you can think of (and some) on one half of a sheet of paper why you can’t. Then on the other half, write down the exact opposite. Focus on why you can. It is a really good exercise for working out what in your past or childhood influenced your mind to believe the way it does. When you’ve finished – FLIP THE SWITCH. Use positive wording. When you wake up in the morning, make your first thoughts positive ones as they will influence your mood for the rest of the day.

3. Your five best friends

Jim Rohn, a well-known entrepreneur and motivational speaker said “you are the average of the five people you spend the most time with”. Look around, who are you spending your time with? Are these people able to motivate you to achieve your goals? Can they help you on your journey? If you friends are living a mundane existence, chances are it is comfortable for you to do the same. Snap out of it. Seek out new alliances to help you get to where you want to be. Start with your goal and identify what skills and supports you’ll need. Identify five people and connect with them. One may be your mentor. One may be someone with characteristics you wish to emulate. One may be someone with the contacts and networks you need. Examine your networks. Are there new networks you can join that can open doors for you.

4. Get a mentor

As Richard Branson said, when you think about the missing link between a promising businessperson and successful one, mentoring comes to mind. On a lonely journey to discovery and success, a mentor provides a trusted arm and beacon along the way. You don’t have to be a business owner to have a mentor. You just need to have a goal and a strong desire to get there. A good mentor will guide you along the way.

5. The power of the master mind

Napoleon Hill in “Think and Grow Rich” told of the power of the master mind. Bring two or more minds together and you create “a third invisible intangible likened to a third mind (the master mind). Bring two or more people together to work on their own businesses in a mutual, trusting, tough love environment, coupled with voluntary accountability, will over time, strengthen each business. A master mind group that works well will achieve results through learning, sharing new ideas and stimulating new ideas and business models.

Put these strategies into place and watch as the world moves to make way for you and your goals.

Your Own Business – Risks Vs Rewards

Introduction

Your own business – an expensive German car or even a red Italian one, holidays in the Swiss Alps, your own condo on a remote island – all potential benefits of having your own business. On the other hand you have the prophets of doom that highlights the long hours, difficult employees, economic recessions, stress and high rates of bankruptcies in business. What is the reality?

In actual fact most new entrepreneurial ventures fail within the first few years. Only a small percentage really makes good money. There are various risks in starting your own business that cannot be ignored. These risks can, however, be drastically reduced with detailed market research, proper business planning and effective management. The potential rewards, for the successful entrepreneur, make the effort more than worthwhile.

Some of the more important risks are:

Financial Risk

The personal financial investment of having your own business is generally quite high. Business failure can mean a substantial financial loss for the entrepreneur (and for other stakeholders) and it can even cause bankruptcy.

Social Risk

A business requires much input from the entrepreneur. This implies less time for family life, friendship, sport, entertainment and holidays. The potential of losing a friend and even a marriage partner is very real.

Career Risk

When an entrepreneur starts his or her own business they normally resign from their present job. If things go wrong it can be difficult or even impossible to resume a career.

Psychological Risk

People handle stress different. Good stress, called eustress, gives a person enough adrenaline to handle difficult situations in a positive way. Distress, on the other hand, can be destructive to the entrepreneur and the business. It can leads to serious burnout and depression. Distress can be caused by working too hard over extended times, too much worries about the various aspects of the business (especially if everything is not going to plan), no proper support system (e.g. from a spouse) and even the feeling that the business was a mistake and that the entrepreneur is climbing the wrong ladder.

Fortunately substantial rewards await the successful entrepreneur, including some of the following:

Financial Rewards

A successful business has the potential to make good profits and provide substantial wealth for the entrepreneur. If this wealth is handled with care it can make a big difference in the financial well-being of an entrepreneur (and his or her spouse and descendants).

Social Rewards

There is seldom a higher reward than making a positive difference to another person’s life. Entrepreneurship is already creating most of the new jobs and wealth in the world. The successful business provides jobs, pride and financial security for its employees. Personal wealth can also be used to make a difference to a family member, a friend, the community or any worthwhile cause.

Independence Rewards

Your own business provides you with the privilege to work for yourself, at your own pace, without a boss and having a sense of freedom. Financial success increases the independence potential.Growth Rewards

The whole entrepreneurial process is a personal growth process and an entrepreneur learns about failure and success, difficult people and situations and especially about themselves. Knowledge about various disciplines will also be enhanced. Successful entrepreneurs generally experience a sense of self-actualisation.

Summary

Having your own business definitely carry substantial risks. If you, however, have the right personality profile, the necessary expertise, and the will to prepare diligently and work hard the chances of entrepreneurial success improve drastically. The potential rewards then outweigh the risks by far.

Business Is So Much Fun

There are two things to aim at in life; first, to achieve what you want; and, after that, to enjoy it. Only the wisest of mankind achieve the second. – Logan Pearsall Smith.

How can one ensure that entrepreneurship is fun and not a stressful activity? Follow Mr Richard Branson of Virgin or Vijay Mallya of Kingfisher to learn the joys of risk and enterprise.

Business can be fun, if you enjoy what you do, but easier said than done. If you can, take one of your hobbies and make it the way you make a living. Passionately loving what you do is such a joy. Working with others who share your passion for similar reasons is also vital. But beware, making your hobby into a career can be stressful at times because one tends to loose the balance when one is passionate.

Starting a new business is like giving birth to a baby. One must work hard in the initial years of business, go through the labor pains (pangs of birth or teething troubles), nurture it with sacrifice like a baby and then we can reap the rewards once the business has bloomed into a success. Until then, entrepreneurship remains a rocking stress boat. But if the focus is on learning something new every day and the passion is the driving force, one is bound to overcome the teething troubles successfully.

Nigel Clayton, Entrepreneurship Coach believes in turning entrepreneurs into Ultrapreneurs. He says, “There are many things you can do to make it fun and not a stressful activity. One thing you can do is divide the tasks you do into three categories, those you are bad at, good at, and love to do. If you don’t know the difference, become aware of how your energy is when you are doing each task.”

We need to differentiate between things we are good at and things we love to do. Things we are good at still drain us whereas things that we love to do reenergize us. When you are only doing the tasks you love to do, each day will have an element of fun and other tasks can be delegated, wherever possible. As a budding entrepreneur one is always cutting cots and one may be forced to do tasks which one does not love to do, but as we cross the break even point and have extra resources at our disposal, we can always look for people to whom we can delegate avoidable work.

Initially what one starts as a hobby, grows into a full-fledged business requiring more managerial tasks and consequently less time is left for the hobby. Often entrepreneurs complain, “I like what I do, but it has been a long time since I actually did that task on a day to day level. Now I spend my time taking care of the business and people instead of doing the original task that caused me to start the business.”

Theoretically it is good to have fun and remain stress free, but practically hard to do. When cash flow and staff’s next month salary is at stake, it’s not fun. When 10% of workforce is about to be fired, then it’s not fun. Entrepreneurship cannot be 24 x7 fun of course. One therefore needs to be mentally prepared for the good, bad and the ugly at times.Entrepreneurship can be stressful when you have survival issues, high overheads, no innovations or ideas to offer to your customers or business partners. Entrepreneurship is fun when you make money, you connect with your customers, keep developing great products/ services, empower all people around you to think and work like one towards your goals.

To conclude, if one has the right attitude and some back up to fall upon during the bad times, business can be an enjoyable process. It is also good to have a few NGO clients, if possible. Though profits may be low, but NGO clients tend to be less competitive and more positive and enjoy watching others succeed immensely.

All said and done, business can be so much fun.

Planning Your Small Business Success Journey – Six Steps to a Dynamite Action Plan

You are considering starting a small business. Most startups fail. So why should yours be any different. Any strategist will tell you that there are many factors that contribute to the success or failure of any endeavor, but the one factor that will guarantee failure is lack of a realistic detailed action plan.

Step 1: Set Realistic and Specific Goals

The key to knowing what goals are realistic and specific is experience. In an established business, past history provides the clue. In a franchise, the franchisor can help you set realistic and specific goals based upon years of experience in the industry. For an independent startup, much research is needed. Talk to other businesses in the area you are considering opening your business. Talk to other business owners in your industry. You will want to ask about customer traffic, revenues, and costs. Then set your goals in each specific area.

Step 2: Identify Activities, Resources, and Responsibilities

I know it worked for Kevin Costner in Field of Dreams, but in the real world, if you build it, no one comes. You have to inform your customers about what you do and why they should patronize you. In many startups you have to lure your first customers in using couponing and special events. Identify the specific marketing and sales activities that will bring your customers in. Have a detailed list of all resources available in your area such as signage, media, and public relations. Outsource what you can. Hire when necessary. Do it yourself if you must. Have a detailed list of responsibilities for each activity and hold your contractors, your staff, and yourself accountable.

Step 3: Define Your Timetable

Your timetable is often closely related to capitalization. Industries have time-tested standards for profitability. A house painter may be profitable in 6 months, but a restaurant takes 3 years to be profitable. If you are considering investing your life savings and need to be profitable in the first month to make your mortgage, find a less expensive business to open. Chart your course carefully.

Step 4: Create Contingency Plans for Other Possible Outcomes

General George Patton once said, “Every plan is perfect until the first shot is fired.” What is your contingency if you get a different result than the one you planned for? If you run a special expecting 20 sales of a particular item, what is your plan if you sell 10? What if 30 people want the special? Always have a plan to liquidate excess with minimal or no loss, or to get more product quickly if needed. If you have done your marketing correctly, people will show up wanting to do business with you. Don’t disappoint them. If there is a piece of equipment that is critical to your business such as a brewer in a coffee shop, know where you backup is. That doesn’t necessarily mean you have another in the cabinet, but have a relationship with your repair service so you can rent one within the hour.

Step 5: Merge your Plan of Action with your Timetable

Every plan must be linked to a realistic and specific timetable. In step 4, you set a timetable to reach the overall objective you identified in step 1. Now, set specific milestones linked to the activities you identified in step 2. These can be graphed with project management software, or a simple outline will do. Just make sure you have identified which tasks need to be identified first before others can be started. Think these through carefully. Building from the bottom up makes sense, but don’t lay your carpet before your roof is finished.

Step 6: Delegate, Supervise, and Evaluate

Launching a startup is a daunting task. Often first time entrepreneurs take on too much themselves and burn out. Then they look for someone they can turn the reigns over to while they focus on what they enjoy most. This is called management by abdication and usually ends in disaster. To implement the plan, the entrepreneur needs to focus on delegation, supervision, and evaluation. This gets the job done faster without burning out the owner.

Entrepreneurship is hard work and high risk. So why do so many try it? Because there is nothing quite as rewarding as building a business that can run without you and provide you with financial security for a lifetime. It may seem the odds are stacked against the first time entrepreneur, but a good detailed action plan goes a long way to level the playing field.