Plan Ahead of Business Ownership
We’re entering a period from September to December when many individuals and families looking ahead to the new year, will start to explore business ownership. Whether a business acquisition, a franchise purchase, and even a startup, it’s important to be well informed and knowledgeable about the path ahead.
As such, I believe it’s a perfect time to revisit some of my previous articles about exploring entrepreneurship, franchising and business ownership. So, over the next few weeks, I will be sharing these articles (in no particular order along with new ones) with a goal of providing information, sharing resources, and addressing questions.
Today, let’s revisit the article, 3 Steps Ahead of Business Ownership. Planning is an essential component to successful business ownership. To that end, there’s no doubt in my mind that the famous Benjamin Franklin quote, “If You Fail to Plan, You Are Planning to Fail” could not be more spot-on!
Of course, we could also look at failing to plan from a different perspective — that of a member of the Baseball Hall of Fame, Yogi Berra. The term Yogi-isims was created to describe Berra’s malapropisms and unintentional witticism. But they’re not just for laughs. As simple as the below statement is, nothing is more true.
“If you don’t know where you are going, you’ll end up someplace else.”
Many people have a dream of owning a business. It’s an American Dream!
However, whether doing so as an independent business or as a franchise there are important initial steps to take to ensure their dream-turned-reality starts off on the right foot.
Improve Financial Health
Review and analyze personal finances. As a first step, it’s essential to understand income coming in and expenses going out each and every month of the year. Think ahead to bills that come due quarterly or annually.
Plan a firm budget. The goal is to ensure living expenses are met for a minimum of one year after starting a business. If a vacation is planned during this period, it must be included in the budget. Pay off all short-term debt to the extent it’s possible and practical to do so.
If savings or income from investments are not allocated for living expenses, it’ll be necessary for personal income to continue through year one. Lenders will require a solid plan that is not dependent upon first year income from the new business. This may require a spouse or life partner continuing their employment while the business gets on firm footing.
Review credit reports for accuracy. Challenge all errors and keep records of the same. Organize all financial records including bank statements, investment account records and insurance policies — auto, health & life.
Consider working through the above with an independent financial coach who can provide valuable professional insight and perspective. From a confidential, non-judgmental position they can help resolve some issues requiring attention that may have initially appeared to have been barriers to business ownership.
Network as Much as Possible
Meet with members of the local business professional services community — bankers, attorneys, financial planners, accountants, realtors. Share plans to start a business within the community. Develop a network of these professionals and keep them apprised of progress.
Attend and actively participate in networking events well in advance of commencing business operations. Networking provides great benefits from a very early stage including introduction of the business to the community, support from fellow business owners and assurance of a busy grand opening.
From visiting with business professional to attending local chamber meetings to participating in community functions, personal involvement starts to establish a long-term commitment to the community. Owning and operating a business is about establishing and building relationships. Do so as early as possible.
Be Honest with Yourself
Although working through due diligence is essential it’s important not to over-analyze to the point of procrastination… or even, paralysis. Taking the necessary steps outlined above should set a foundation of being well-informed and yes, a foundation of comfort and confidence, as well.
If you’re considering business ownership for yourself and your family, and want to learn how the choice of a franchise, startup or acquisition can “jump-start” the process and your earning potential, please review additional information at one of our new resource sites at https://ownabizness.com/.
Have a great day. Make it happen. Make it count!