Read Start Your Own Business Online
Authors: Inc The Staff of Entrepreneur Media
Start Your Own Business (7 page)
“Working by day and running a business by night creates a host of potential conflicts and can add a tremendous amount of stress,” cautions Arnold Sanow, co-author of
You Can Start Your Own Business
. Sanow says conflicts between a day job and a sideline business are common, as are family problems: “I’ve seen a lot of divorces as a result of working full time and having a business on the side.”
You Can Start Your Own Business
. Sanow says conflicts between a day job and a sideline business are common, as are family problems: “I’ve seen a lot of divorces as a result of working full time and having a business on the side.”
That’s not to say a part-time business can’t work. It can, Sanow says—if you have excellent time management skills, strong self-discipline, and support from family and friends. Also crucial, he says, is your commitment: “Don’t think that, since you already have a job, you don’t really have to work hard at your business. You must have a plan of attack.”
Market MattersAs with any business, your plan of attack should start with a thorough assessment of your idea’s market potential. Often, this step alone will be enough to tell you whether you should start part time or full time.
You can’t become so caught up in your love for what you’re doing that you overlook the business realities. If you find there is a huge unmet need for your product or service, no major competition and a ready supply of eager customers, then by all means go ahead and start full time. If, on the other hand, you find that the market won’t support a full-time business, but might someday with proper marketing and business development, then it is probably best to start part time at first.
Investigate factors such as the competition in your industry, the economy in your area, the demographic breakdown of your client base, and the availability of potential customers. If you are thinking of opening an upscale beauty salon, for example, evaluate the number of similar shops in operation, as well as the number of affluent women in the area and the fees they are willing to pay.
Once you have determined there is a need for your business, outline your goals and strategies in a comprehensive business plan. You should always conduct extensive research, make market projections for your business, and set goals for yourself based on these findings. It gives you a tremendous view of the long-range possibilities and keeps the business on the right track. Don’t neglect writing a business plan even if you’re starting part time: A well-written business plan will help you take your business full time later on.
Certain businesses lend themselves well to part-time operation: Holland cites e-commerce, food products, direct marketing and service businesses as examples. Doing your market research and business plan will give you a more realistic idea of whether your business can work part time. (For specifics on conducting market research and writing a business plan, see Chapters 6, 7 and 10).
WARNINGDon’t bite the hand that feeds you. Starting a business that competes with your current employer may get you in legal hot water by violating noncompete clauses in your employment contract. If you start a business in the same industry, focus on a small niche your employer has overlooked.
If you’ve got your heart set on a business that traditionally requires a full-time commitment, think creatively: There may be ways to make it work on a part-time basis. For instance, instead of a restaurant, consider a catering business. You’ll still get to create menus and interact with customers, but your work can all be done during evenings and weekends.
Financial PlanOne major factor in the decision to start part time or full time is your financial situation. Before launching a full-time business, most experts recommend putting aside enough to live on for at least six months to a year. (That amount may vary; completing your business plan will show you in detail how long you can expect to wait before your business begins earning a profit.)
AHA!If keeping a full-time job and a part-time business going at the same time sounds too difficult, and taking the full-time plunge sounds too scary, consider taking a part-time or temporary job while you start a full-time business. This can be a way to ensure you have some salary coming in, while giving you time to work on your business. Part-time jobs often offer evening or weekend hours—a big plus if you need to be accessible to clients during regular business hours.
Basic factors you should consider include the amount of your existing savings, whether you have assets that could be sold for cash, whether friends or family members might offer you financing or loans, and whether your spouse or other family members’ salaries could be enough to support your family while you launch a business full time.
If, like many people, you lack the financial resources to start full time, beginning part time is often a good alternative. However, even if you do start part time, you’ll want to keep some figures in mind: Specifically, how do you know when your business is making enough money that you can say goodbye to your day job?
A good rule of thumb, according to Sanow, is to wait until your part-time business is bringing in income equivalent to at least 30 percent of your current salary from your full-time job. “With 30 percent of their income, plus all the extra time during the day to promote their business, [entrepreneurs] should be able to make [the transition at that point],” he says. Another good idea: Start putting more money aside while you still have your day job. That way, when you take the full-time plunge, you’ll have a financial cushion to supplement the income from your business.
Family AffairsThe emotional and psychological side of starting a business is less cutand-dried than financial and market aspects, but it’s just as important in your decision to start part time or full time.
Begin by discussing the situation with your spouse, significant other or family members. Do they support your decision to start a business? Do they understand the sacrifices both full-time and part-time businesses will require—from you, from them and from the whole family? Make sure your loved ones feel free to bring any objections or worries out in the open. The time to do this is now—not three months after you have committed to your business and it is too late to back out.
Then, work together to come up with practical solutions to the problems you foresee (could your spouse take over some of the household chores you currently handle, for example?). Lay some ground rules for the part-time business—for instance, no work on Sunday afternoons, or no discussing business at the dinner table.
To make your part-time business a success and keep your family happy, time management is key. Balance the hours you have available. Get up early, and don’t spend valuable time on frivolous phone calls and other time wasters.
Getting PersonalTIPWhat do you do if you can’t afford to start your business full time but need to be available full time to answer client and customer calls? Consider teaming up with a partner whose available hours complement yours.
Besides the effect business ownership will have on your family, equally important to consider is the toll it might take on you. If the idea of taking the full-time business plunge and giving up your comfy salary and cushy benefits keeps you awake at night biting your nails, then perhaps a part-time business is best. On the other hand, if you need to work long hours at your current full-time job, you commute 60 miles round-trip and you have 2-year-old triplets, piling a part-time business on top of all those commitments could be the straw that breaks the camel’s back.
TAKE IT EASYD
oes all work and no play make entrepreneurship no fun? Some entrepreneurs who run part-time businesses based on hobbies, such as crafts or cooking, find that going full time takes all the fun out of the venture. “Going full time turns an adventure into a job,” as business expert Arnold Sanow puts it.Some entrepreneurs have trouble grasping the fact that their businesses aren’t just pastimes anymore. They can’t work at their leisure any longer, and their ventures may require them to develop talents they didn’t know they had and perform tasks they’d rather leave to someone else.Don’t get so caught up in the creative aspects of the venture that you lose sight of the business responsibilities you must assume to make your startup succeed. Take a realistic look at what going full time will require. Perhaps you can hire people to handle the business aspects you dislike, such as sales or operations.
Of course, a full-time business does require long, long hours, but a part-time business combined with a full-time job can be even more stressful. If this is the route you’re considering, carefully assess the effects on your life. You’ll be using evenings, weekends and lunch hours—and, most likely, your holidays, sick days and vacation time—to take care of business. You’ll probably have to give up leisure activities such as going to the movies, watching TV, reading or going to the gym. How will you feel the next time you drag yourself home, exhausted after a late night at the office ... then have to sit right down and spend four hours working on a project that a client needs the next morning? This is the kind of commitment you will need to make if you expect your part-time business to succeed. Carefully consider whether you have the mental and physical stamina to give your best effort to both your job and your business.
Decisions, DecisionsWhether to start part time or full time is a decision only you can make. Whichever route you take, the secret to success is an honest assessment of your resources, your commitment level and the support systems you have in place. With those factors firmly in mind, you will be able to make the right choice.
PART-TIME POINTERSB
alancing a full-time job with a part-time business isn’t easy—but it can be done. Arnold Sanow, co-author of
You Can Start Your Own Business
, suggests these tips to help make your part-time business a success:•
Involve your family in the business whenever possible
. Whether it’s answering the phone, stuffing envelopes or putting together orders, giving your family the chance to help out is a great way to get more accomplished in less time—while also making your family feel like they’re part of your business.•
Be ready to give up personal time
. You won’t have much time for TV, reading or hobbies you used to enjoy. Be sure the sacrifice is worth it, or both your job and your business will suffer.•
Focus on the task in front of you
. When you’re at work, focus on work; don’t let thoughts of your business distract you.•
Make the most of every minute
. Use lunch hours or early morning to make phone calls; use commuting time on the train to catch up on paperwork.•
Take advantage of time zone differences and technology
. If you do business with people in other states or countries, make time differences work to your advantage by calling early in the morning or after work. Use faxes and e-mail to communicate with clients at any time of day or night.•
Don’t overstep your boundaries
. Making business calls on company time or using your employer’s supplies or equipment for business purposes is a big no-no.•
Be honest
. Only you can assess your situation, but in many cases it’s best to be upfront with your boss about your sideline business. As long as it doesn’t interfere with your job, many bosses won’t mind—and you’ll gain by being honest rather than making them feel you have something to hide.
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