Tens of thousands of Americans have a dream of owning their own business. For some, the idea of taking control of their worklife is a huge motivator. For others, it’s the desire to increase personal wealth that drives them. Whether you are looking to just replace your current income with an independent work life or are looking to be the next Bill Gates, you have to start somewhere. Here are five things you can do now to set yourself on the path to entrepreneurship.
1. Live Cheaply
Starting a business guarantees you just one thing – you will be on a tight budget for some amount of time. It might be just a few months, it might take a year or so to build your company’s profitability, but your personal expenses will need to be under control before you start. Get in the habit of living cheaply now. Review your household budget (or develop one) and look for areas to cut back. Pay off credit cards, look for deals when you shop, clip coupons, find inexpensive entertainment options. The more you can control expenses now, the less stress you will be under during the early stages of your startup.
2. Set Aside Cash
As a result of your reduced budget, you should free up some cash that can be set aside for your startup. Even if your business idea will qualify you for outside loans or investment, you will need to cover a significant portion of the startup out of your own pocket. And, the more cash you have on hand for living expenses during the first year or so, the better able you will be to pour the profits back in to the company, and the more quickly you can grow your venture and meet your goals.
3. Do Your Homework
Whatever your business idea, or even if you are still looking for one, start paying attention to the market now. Visit competitors, talk to friends and family, get to know other small business owners. Surf the web for websites, trade associations, or other businesses related to what you want to do. Sign up for email lists and get up-to-date on the trends within your selected industries.
4. Plan, Plan, Plan
Once you have settled on a particular business idea, get started with your planning. Business planning is not about filling in the blanks of a ready-made business plan worksheet. Rather, actually planning a business is like creating a roadmap for how and what to do, every step of the way. Every aspect of your business idea should be broken down, analyzed, and evaluated for innovative, more efficient opportunities to reduce risk and increase profitability. Don’t underestimate the value of thorough planning. Yes, there are success stories and even startup experts who will tell you that you can make it in business without really trying, but if you are looking for a solid future with limited risk, good detailed planning is the only way to go.
5. Take a Chance!
At some point, you just have to pull the trigger. Yes, you need to build your cash reserves and plan out your business idea, but you also have to choose a starting point and take the leap into entrepreneurship.