July 7, 2010

Small Business Start-Up, Is It For You? Part 1 of 3

Before you can develop a business plan or start thinking about a catchy business name, you first have to find out if starting your own small business is for you. Many companies fold within the first year of operation and in many cases a lot of those businesses should have never moved past the thought process. The discussions over the next few days will give you a basic breakdown on how to figure out if starting your own small business is a wise decision. Today we will cover the first step in figuring out if you’re compatible with entrepreneurship.

Many people blindly start their own small business without considering if they are truly adept with what it takes to successful make it in the entrepreneur world. According to the SBA seven out of ten new employer firms last at least two years, and about half survive five years (1). To prevent from being part of the failure statistics, you must evaluate if you are even compatible with entrepreneurship.

Business Rule 1#-Know Thy Self
In order to successfully run a business you must have capital, a business plan must be created but what many forget to consider is if you possess the necessary character traits needed to successfully run a small business. Entrepreneurship is not for everyone and understanding that is the key to figuring out if entrepreneurship is for you. The first step to figuring out if you’re compatible with entrepreneurship is by identifying and examining your strengths and weakness. This can be easily done by completing the below exercise, which is a simple way to quickly but thoroughly identify what you believe are your positive and negative character traits.

Step 1. Create a list of your positive and negative character traits (i.e. Positive- outgoing, patient; Negative- shy, impatient.)
Step 2. Take time to review your answers and really concentrate on your positive and negative character traits.

By truthfully listing the character traits that you posses allow you to get closer to figuring out if being an entrepreneur is for you. Now that you have the list created, a deep reflection should allow you to answer the following:
  •    If you weren’t the owner, would you hire someone like yourself to run the business?
  •    Could you trust this person with your life’s work and savings?
It is imperative that you understand yourself and your capabilities in order to figure out if you should start your own business. Knowing self will help prepare yourself for the realism of starting a small business.

Are you compatible with Entrepreneurship?

For further exploring:

Works Cited
(1)United States. Small Business Administration. Office of Advocacy. Frequently Asked Questions. Small Business Administration, Sept. 2009. Web. 25 May 2010. 

Article Worth Checking Out: 
Startup Basics

This article goes over the Small Business Administration steps to business planning.
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