WORD OF CAUTION:
I have personally witnessed people who have mortgaged their life savings, homes or both to start unsuccessful businesses, resulting in the loss of savings, retirement plans and their home. I would never discourage anyone against striving for their dream; just make sure that dream doesn’t become a nightmare.
If you have never owned a business before, start small and build. Remember UPS was started by two teenagers, with one bicycle and a vision. The employees, trucks and planes came later. Starting from home allows you to control the risk.
More than half of all businesses close within five years and many within the first year. Don’t roll the dice with your future. Your time, energy and money spent should be an investment for you and your family and not a gamble that you can’t afford to lose. Please take the time to thoroughly research your concept and assess yourself and consider both the positives of business success and the consequence if things don’t go according to plans. The most common reasons for business failure are:
- Poor accounting or lack of financial planning and review
- No successor –
business closes when owner gets sick or dies
dependence on a single customer
- Owner concentrating on the technical, rather than the whole business strategy
- No cushion –
enough cash for personal and business expenses
- Lack of vision, purpose, principles or management system
- Failure to establish or communicate company goals
- Competition or lack of market knowledge
- Poor quality or standards
- Declining market or obsolete products and services
Once you’ve done the proper preparation, start your business and make it a great success! Good luck!