Maybe you are on the verge of a momentous decision. Planning has begun, and the vision, though a distant one, has the possibility of one day becoming a reality. Yes, the idea of being your own boss is an attractive one. A life changing move. However only the well informed are likely to succeed.
When planning to start up your own small business, one should seriously consider the negative points, and problems that are likely to be encountered. Turning a blind eye to the downside of entrepreneurship is a disaster waiting to happen.
In this article, we will touch on some basic, and sometimes obvious, issues that will be encountered as you run your own empire.
Cost of startup. This differs widely; however, it is commonly accepted that, even with the best planning, it will cost you a lot more than you think. Though lending to business is on the rise again, banks are not as free with cash as they were a few years ago. Obviously the cost is entirely dependent on your area of business. A retail establishment, for instance, is going to cost a lot more to set up than a small office. Telecommunications are a good example of a start-up cost you may underestimate. At home, you can find telephone and broadband for an excellent low price. For a small business, the cost will be double, or even more.
Suppliers. If you are in retail, are you aware of the minimum order value? Most suppliers impose it on you, and for a small business it can be crippling. Imagine you ran out of one colour, or size, of an item, and need to replace it. It may only cost ten or twenty pounds; however, your suppliers may not accept orders for less than, say, three hundred pounds. It is a constant juggling exercise.
Clients. Do you have a full client list to start with? Most businesses don’t, and the first year can be a tough one. It takes time to build a good client base and you may find yourself spending days at a time selling yourself on the telephone ,or internet, with little in the way of results. This problem is one of the biggest causes of stress and sleepless nights. Moving forward through the desire to give up, takes a lot off effort sometimes.
Staff. Employing people can be a minefield to the ill-informed. Do you have a basic working knowledge of employment law and procedures? You could easily be opening yourself up to expensive litigation costs when defending yourself against disgruntled ex-employees.
Tax. Once a year you will be required to complete a tax return and pay your dues. You may use the services of an accountant. However, the accuracy of the return filed on your behalf can only be measured by the information you provide. Be honest and keep accurate records. Around one in twenty small businesses is subject to further scrutiny from HMRC every year. Are you also aware that if you make a profit you may be asked to pay part of next years tax in advance?
If your business fails. The buck stops here! The business may be in a mountain of debt, with creditors banging down the door. All too often, businesses are taken into bankruptcy by their creditors or bank. If this occurs, it is essential that you call the professionals. Should you need bankruptcy help in Cheadle, Uttoxeter, or Stafford, help is out there with a simple internet search.
There are a few points for consideration. It does paint a gloomy picture doesn’t it? These issues are not insurmountable though, and there is no reason why you should give up on your dream. Often all it takes is determination and being clued-up. Some of the most unlikely characters you can hope to meet have made huge strides in the business world.
You can do it too!