The thought of starting a business is something that excites millions of people. It could unlock the door to increased wealth while the thought of working for yourself has many benefits too. However, it’s not the best option for everyone. If it were, nobody would be prepared to work for others.
If you’re thinking about going it alone with your service-based skills, it’s vital that you understand the environment. Ask yourself the following questions, and you will gain a far clearer idea as to whether it’s the right path for you.
#1: Will I Be Better Off?
Before looking at the specifics of any business model, you must determine whether going it alone will actually benefit your life. After all, there is zero value in taking the risks or making the effort for a worse situation than what you currently have.
Success can be defined in many ways, but financial outcomes are the main goal for most people. Using a weekly paycheck calculator to analyze the details of your current pay will give you a good starting point. This info can be compared against the proposed rates that you plan to charge customers for your services.
This will let you know whether the business model has the potential to benefit you. And it will also let you know what is needed to at least match your current situation.
#2: Do I Still Enjoy the Work?
The fact that you are currently considering the prospect of starting a business shows that you’re not 100% happy in your current position. Of course, there is a strong possibility that gaining control of your work life will be enough to change that. Then again, it might not.
Starting a business won’t suddenly erase lost enthusiasm for the work itself. There are many benefits to be gained from launching a beauty business, plumbing firm, or consultancy. Still, without an appreciation of the potential negatives, you’ll never truly know whether it’s the right choice. A calculated choice is essential.
If you have fallen out of love with the work, it might be necessary to change industry. From here, you can decide whether to start a company or resume traditional employment.
#3. Do I Have the Funds?
Registering a company is more affordable than ever. Moreover, service-based ventures often require a far smaller outlay than product-based firms. Despite those factors, you will need some capital to get the venture off the ground. Financing is a vital prerequisite.
There are several ways to finance your business. Personal investments, private backers, crowdfunding, and bank loans are the most common. Unless opting for personal investment, you will need to convince people that the venture can thrive. A business plan template is one of the best tools at your disposal. Use it.
Over half of all businesses die out within their first five years of existence. Starting out with too little capital is the most common route cause. Ignoring it is not an option.
#4: Is It the Right Time?
Timing is everything in business. Not least in this post-coronavirus arena. If your current job is looking unstable, it might be a reason to start the company ASAP. Conversely, though, if you have stability, it may be better to wait for a few months.
If you do persist with the service-based business, you will need to check out the latest PPE and cleaning tools. Some services (accountants, electricians, etc.) can enjoy minimal contact with clients. Others (hairdressers, beauticians, etc,) will spend more time around customers. Either way, though, safety will be paramount.
When you decide that delaying the launch is a better solution, this time can still be put to good use. Market research, branding preparations, and fundraising are just three examples.
#5: Where Shall I Be Based?
A service-based operation may sell a local service or an online one. In truth, the entire operation will be heavily influenced by this factor. Either way, though, knowing where you will work is one of the most important decisions you’ll ever make.
If offering a local service, there are three main options. You can rent a permanent space (store), use pop-up stores, or run a service that visits the clients. Conversely, if selling online services, your options include working from home, an office, or an industrial unit. There is no right option, except the one that works for you.
The right selection, then, should deliver a cost-effective solution that promotes productivity. When that formula for success is in place, you won’t go far wrong.
#6. Do I Have an Audience?
Your business will rely heavily on the customer base figures. Ultimately, without clients, the quality of your services will count for nothing. Virtually all niches can now secure a large enough following to achieve healthy profits. But only if you target them in style.
The fact is that trying to sell a budget-friendly beauty service will require different tactics to a B2B security systems service. Demographic analysis tools can be used to provide the insight and direction needed to thrive. This will allow you to build marketing content that reaches the right people at the right time. Crucially, it will be focused on engagement and conversions.
Once you find the formula for success, you should see natural growth. When supported by excellent services and customer care, their loyalty should follow.
#7: Where Will I Find the Right Help?
When starting a service-based SME, it’s likely that you will have a very small team. This is especially true when offering a local service rather than something that is delivered via digital methods. Even so, you cannot ignore the need to build a winning team.
While the skills are important, you cannot underestimate the significance of character traits. You need a team of passionate workers that believe in business and put a focus on client care. Getting this right will secure long-term loyalty and encourage people to spread the word. Both of those features are integral to your business plans.
Employees or business partners aren’t the only support you might need, though. Web design contractors, virtual receptionists, and other outsourced workers may also be required.
#8: How Quickly Do I Need to Turn a Profit?
As a service-based business, you can start to generate revenue far sooner than most product-based ventures. Nevertheless, it will take time to reach a level where you turn a profit that can cover your salary while still helping the business grow.
Taking this period of transition into account will be pivotal. Otherwise, you will be forced to quit without ever giving yourself a fair chance at success. For this reason, many entrepreneurs find that it’s best to start out as a part-time side project. That way, the stability of a traditional job can be retained for as long as necessary.
You don’t want to put yourself under unnecessary pressure. Then again, putting deadlines and targets in place will kick you into action. Finding the right balance is vital.
#9: Am I Prepared to Run a Business?
Managing a successful business is one of the most rewarding things you could ever hope to do with your career. Still, it would be very naive to think that it’s easy. Not everyone is suited to the challenge. So, it’s important to address this situation.
The job role includes being available to deal with urgent situations at all times. Likewise, you will have to take on organizational elements that aren’t related to the skills you love showing off. When combined with the people management tasks and inevitable stressful moments in the early moments, you can see it’s not for everyone.
Many aspects of the business can be passed onto others. Nevertheless, an understanding of the tasks and hours that you could face will play a key role in the decision-making process. It’ll either save you from a mistake or give you a boost of motivation.
#10: Do I Need to Develop Better Skills?
Even if you have the personality to manage the business, there’s a good chance that you will have to learn new skills. From learning how to track the financial elements to scheduling and staff management, you must take each step seriously.
In many cases, it may be necessary to upgrade your active skills too. When you have become accustomed to doing things in a certain way to satisfy your employer, it’s likely that bad habits will be picked up. Therefore, teaching yourself to do things in a manner that will impress your future consumers is vital.
Similarly, it’s not uncommon for people to find that their skills have become a little outdated. Learning new techniques and technologies will serve you well.
#11. Are Additional Revenue Streams Available?
One of the great things about going it alone is that you are no longer limited to earnings from one source, such as a wage. When managing a business, you have the opportunity to introduce secondary streams. This can transform everything.
If working as a hairdresser, you may want to sell the hair care products that are used in treatments. Meanwhile, if your service is related to blogging or vlogging, you may want to add a line of products. With a little creative thinking, you could support your main revenue stream in a big way. In some cases, those avenues can outweigh the main service.
Crucially, those ideas help build the brand while it’s an opportunity to have a little added fun by keeping things fresh. Perfect.
#12: What Are the End Goals?
When first launching the business, your main aims are to stay afloat and carve a better life than what you currently have. However, you do not want to level out after just 12 or 24 months in business. A normal career would lead to progression; your company should too.
Long-term goals can be motivated by money, philanthropy, or the desire for status. Moreover, it could take several forms, such as building a franchise or adding additional services to the repertoire. The possibilities are almost endless. While objectives may change over time, it’s important to have one eye on future growth even at the start.
If nothing else, this will keep your motivation levels high during the immediate and long-term future. This purpose and direction could make all the difference.