My social media news feed is full of articles and stories about business ownership. I am a business lawyer. I represent business people. So it benefits me if I promote business ownership and in general I try to do just that. However, I am here to tell you that despite the mountains of articles talking about how successful you can become the truth is that business ownership isn’t for everyone. In fact, it probably isn’t for most people.
Unfortunately, I see the heartache all too often. People who have invested their life savings, only to lose much of it –and sometimes–all of it. People who have bills, stress and anxiety due to a failing business. Most people are just meant to work for other people. They should be employees, not business owners. Sorry but the cold hard truth isn’t said enough in today’s social media channels.
Now, if you aren’t scared off by this point and you’re just bound and determined to move forward with business ownership, the following are some of the more important keys to consider before diving in:
- Is there a market for your product/service? Not just a perceived market or a hunch, but is there a REAL market for your product/service? This requires you to some research and hitting the streets to talk to potential customers. If at all possible, can you pre-sell your product or service?
- Is there a real need for your product/service? If your business doesn’t fulfill a need it is not likely to be successful. To me, this is also a different question that No. 1 above. Trust me, I have seen too many businesses fail because the product/service did not fulfill a true need. Ask yourself, “Is this something people need to have?” I remember hearing the story of a billionaire who started as a roofer. He got into that business because “even Jesus needed a roof.” Businesses that fulfill a need have a greater chance of success.
- Do you have the ability to sell the product/service? If you don’t you have the ability to sell you better get someone on board that does. The greatest idea in the world isn’t any good if you can’t sell it. Execution is more important than the idea and that requires sales. Don’t fall in love with the idea. Fall in love with selling the idea!
- How are you going to pay for the business? Bootstrapping may garner headlines but most businesses require capital. Make sure you have enough capital to survive the difficult early periods. And always keep enough in reserves to weather hard times. And remember you’ll need more than you think you need, so just double your initial estimates to be safe.
The failure to properly answer these questions has been the downfall of many business owners. Don’t let that be you. Ask the tough questions before you invest your hard earned savings.