Are you financially ready to start your own Business?
Perhaps no other word inspires an adrenalin rush as the word Entrepreneurship. It conjures not only images of success, wealth and good life, but also of uncertainty and unpredictability.
For most of us excited to take the plunge and be our own boss, a healthy dose of what it entails will be good to consider. In this blog, we specifically share thoughts on the Financial readiness that wannapreneurs must consider, that will make not only the transition, but also growth as an entrepreneur rewarding.
PUTTING FIRST THINGS FIRST:
- How can I sharpen my commercial acumen? This simply means skills in understanding business numbers, cost outlays, revenue figures, factors that play on P&L, and using these insights to make better decisions regards your business, especially when it comes to pricing and negotiation. There are lots of short online courses available via MOOCs which you may want to consider to develop this mandatory, but oft over-looked skill.
- How do I fund my business? Very important question that you may want to consider not just for the start up phase of your business, but also for the scale up phase of your business.
- The type of formal financing options available to you also depend on the company you decide to form, so do check with your CA on these various options.
- Your own personal network of family and friends who hold you in high esteem regards your personal credibility- will they pitch in with additional funds when needed by your business
UNDERSTANDING COST STRUCTURES:
As a budding entrepreneur, it is imperative that you create a business plan. Whilst most of the business plans chalk out ambitious revenue plans, they fail on putting realistic cost heads.
Costs can be broadly categorized as:
- Start up Costs:
- Company registration and Compliances
- Office Space and Infrastructure
- Operational Cost: Cost of providing the service/Product
- Scale up Costs:
- Addition of staff generally always drives up operational cost- so balance the cash available to new expenses you will incur
- Cost of acquisition of customers may go up, payment terms may change, new areas of expansion may not yield desired results all the time- and your business needs to be able to take all such losses capably.
- We recommend having a good amount of research to understand realistic cost structures involved with setting a business within the market you have identified.
- Understanding the general payment terms that your industry works on, and incorporating this element while projecting cash inflows, will help you to plan your out-flows better and also predict those months when you will have to infuse cash from outside.
AND SOME FOR THE RAINY DAY
And yes, as an entrepreneur, you need to be looking at this element without flinching. Not all days are made equal and economies are predictable in their unpredictability. Factor in these and always have reserves to tide through rough patches.
High amount of conviction is needed, to be able to drive a business which becomes a legacy – This conviction fuels a “give it all” madness, knowing deep down that the gamble is going to pay off. Do not be afraid to let go off your prized personal possessions if your business requires. Your commitment to your own idea will be tested quite ruthlessly and only those who go on the limb reap rich rewards.
Over the last 25 years, Antal International Network has walked this talk and has emerged even more convinced that we are THE BEST IDEA IN GLOBAL RECRUITMENT. These experiences and learning are freely shared with those wanting to start their entrepreneurial venture.
To know if you are financially ready to take the plunge, reach out to us on firstname.lastname@example.org