Many people have the goal of starting a small business because they think it’s more flexible.
Alexandria Blaelock, author of Holistic Personal Finance: How to pay for the life you want says “Starting a small business can be flexible, but it’s generally the kind of flexible where you’re working at 3 am, not the kind where you’re going out for morning coffee.”
Here are Blaelock’s tips for starting a small business:
- Have something to sell: A business is not a business if it’s not making money. To make money, you need either a product or service to sell. Product businesses are expensive to start up but scalable. Services are cheap to start up but limited by your available time.
- Research, research, research: The majority of businesses fail in their first year. Before you commit any money to it, make sure you have a reasonable idea about whether there’s a long-term future in it.
- Choose on or off-line: Shop fronts are expensive to set up but suggest stability and draw in passing traffic. On-line are easy to set up and open all hours, but you’re competing with everyone on the planet. Combining the two offers the best of both worlds.
- Transition from employment: Given most businesses fail in their first year, try starting it as a side project, gradually increasing the hours you devote to it. In the meantime, cut your living expenses and save up a nest egg to keep you going when you quit your job.
- Avoid borrowing money: Where possible, avoid borrowing money because your lender has the power to shut your business down (and worse)
.Contact your local Small Business Department to see if you’re eligible for grants, tax incentives or low cost loans.
Alexandria’s tips for starting a small business will help you avoid start-up money stress and get your small business off to a good start.
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