Starting your own business
Discussion
how did you find taking the leap from having a guaranteed income each month to not knowing if you would?!Well that's where the 'bottle' comes in. It's really really really scary but I must have done something right because my income grew at about the rate I had planned for.
Year 1 was a bit stressful - by year 3 it was 'normal' and very relaxed.
It did help that I, essentially, did a degree in management at uni and, when I applied for a government grant, I was forced to submit a full business plan. Both helped to 'formalise' my plans.
Otherwise it was a matter of knowing what I was going to do, how to finance it and telling the taxman.
Easy peasy.
Year 1 was a bit stressful - by year 3 it was 'normal' and very relaxed.
It did help that I, essentially, did a degree in management at uni and, when I applied for a government grant, I was forced to submit a full business plan. Both helped to 'formalise' my plans.
Otherwise it was a matter of knowing what I was going to do, how to finance it and telling the taxman.
Easy peasy.
Go to Business Link, a lot of local enteprise type organisaitons run courses in business start up. They teach you the basics in how to sort out a business plan, accounts, VAT and tax implications, some basics of marketing and management. You can also do a NVQ in small business start ups i believe. Also try the Federation of Small Businesses, and of course which bank you go to has a big impact. Barclays business site have some basic factsheets on their website, you are allowed up to 3 free of charge that detail specific job business types and some basic pointers of costs, structure and legals.
You need a decent bit of cash behind you, as a rule of thumb i would say you would need all your start up costs plus about 3-6 months personal living costs in hand. Depending on hif you are a cash business or if you will be providing a service. If you do service work for a lot of companies they have 90 day payment terms which can really put a stress on your cashflow.
If you have any debts such as credit cards or expensive unsecured loans you are well advised to get rid of them before you start, you need as few outgoings as possible. And its generally recommended if you have a partner that at least 1 of you carries on in employment while the other runs the business. Most businesses fail in their first year due to cashflow problems, if you can keep positive cashflow and your cash burn under control then you can beat the odds of survival.
The trick is to go at a sensible pace, don't spend a penny more than you have to initially, do all the deals you can in to get your costs down and watch every penny you spend.
Also you don't have a boss, but remember you don't have someone with a boot up your ass to make you do the work. its very tempting to skive off when you don't feel like it, being self employed is actually double the work of being employed if you want to actually survive and make a profit. Expect 12 hour days and 7 day weeks, cancelled holidays and little free time. If you go into it from the point of view that you are going to do part time hours or simply slack off then i doubt you will make your first year - all the businesses i have known that have done well have been the ones htat sweat blood and burned the candle to get ahead of the game.
good luck
You need a decent bit of cash behind you, as a rule of thumb i would say you would need all your start up costs plus about 3-6 months personal living costs in hand. Depending on hif you are a cash business or if you will be providing a service. If you do service work for a lot of companies they have 90 day payment terms which can really put a stress on your cashflow.
If you have any debts such as credit cards or expensive unsecured loans you are well advised to get rid of them before you start, you need as few outgoings as possible. And its generally recommended if you have a partner that at least 1 of you carries on in employment while the other runs the business. Most businesses fail in their first year due to cashflow problems, if you can keep positive cashflow and your cash burn under control then you can beat the odds of survival.
The trick is to go at a sensible pace, don't spend a penny more than you have to initially, do all the deals you can in to get your costs down and watch every penny you spend.
Also you don't have a boss, but remember you don't have someone with a boot up your ass to make you do the work. its very tempting to skive off when you don't feel like it, being self employed is actually double the work of being employed if you want to actually survive and make a profit. Expect 12 hour days and 7 day weeks, cancelled holidays and little free time. If you go into it from the point of view that you are going to do part time hours or simply slack off then i doubt you will make your first year - all the businesses i have known that have done well have been the ones htat sweat blood and burned the candle to get ahead of the game.
good luck
what you are doing is a good point and what the profit margins are like is a major factor,
If the product or service you are selling is £ 100 deals making 20 - 30 % then you need to do a shit load of deals to cover your currently salary, depending on of course if you are a high earner now.
My last job i was on about 70 K per year now while of course you can live on much much less that that your lifestyle is set at that level , I had a big mortgage, partner did not work etc.
For that reason i never had the balls to start up on my own despite thinking about it everyday, I was forced into it and it was the best thing ever.
I work a normal working week in the office and am always doing other stuff on the PC at home in the evening and weekend but it never really feels like work, Your new boss becomes your clients and in the main its best to always remember that, I am sometimes so tempted to act in a way that I would not do it I had a boss, tell an awkard client to shove it etc.
Somebody earlier said about havinf 3 - 6 months salary behind you, personally I would think the more the better but while I was dreaming about it my goal was to have 12 months salary equal in the bank.
Alot will depend on you as a person and what your motivation factors are, for just me I can suffer a lack of motivation but when you have to make things work because your partner and in particular kids depend on you its a good boost.
Good Luck
If the product or service you are selling is £ 100 deals making 20 - 30 % then you need to do a shit load of deals to cover your currently salary, depending on of course if you are a high earner now.
My last job i was on about 70 K per year now while of course you can live on much much less that that your lifestyle is set at that level , I had a big mortgage, partner did not work etc.
For that reason i never had the balls to start up on my own despite thinking about it everyday, I was forced into it and it was the best thing ever.
I work a normal working week in the office and am always doing other stuff on the PC at home in the evening and weekend but it never really feels like work, Your new boss becomes your clients and in the main its best to always remember that, I am sometimes so tempted to act in a way that I would not do it I had a boss, tell an awkard client to shove it etc.
Somebody earlier said about havinf 3 - 6 months salary behind you, personally I would think the more the better but while I was dreaming about it my goal was to have 12 months salary equal in the bank.
Alot will depend on you as a person and what your motivation factors are, for just me I can suffer a lack of motivation but when you have to make things work because your partner and in particular kids depend on you its a good boost.
Good Luck
POORCARDEALER said:
restoman said:
I've found the best part of being self-employed is being able to tell customers who are a pain in the a*** to p*** off.
lol yes agree with that...do you think as you get older you tolerate idiots less?
think so,the one thing i have learnt is that you never stop working when your self employed its a lot of stress and hard work,but the rewards can be worth it!!!Edited by squeezebm on Sunday 23 September 19:22
Eric Mc said:
What do you intend to do?
Well since iv left school i'v always worked in the motor trade, started off as a valetor for audi then ferrari, now i retail and trade part exchanges for a volkswagen franchise on the south coast. now im 20 as of last week, i want to start trading and retailing cars myself! would like the challenge! built up a few contacts and saved up a fair bit of money, and thats why im selling my S2000 
to help fund this.
RichBurley said:
Eric Mc said:
Car dealing?
The thread was going so well until the OP announced that his business plan was car dealing.M3MTH said:
RichBurley said:
Eric Mc said:
Car dealing?
The thread was going so well until the OP announced that his business plan was car dealing.It's just your post seems to be the weekly "I want to start a car sales business" thread, which is normally followe up by car sales owners advising that it is a bad idea to start a business now, the returns are just not worth it, and the outlay to have a proper "kosher" business with good cars is very high.
I know car dealers who are personal friends of mine, and I have a lot of respect for them; I know how hard it is for them. I wish you luck, I just mention (for your benefit) that it is hard work.
Edited for typo reasons...
Edited by RichBurley on Monday 24th September 14:53
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