There’s nothing worse for your career prospects than losing your job, especially if it comes at a crucial time of the year. However, while all hope may seem lost, your redundancy could actually be a blessing in disguise — especially when you look at setting up a small business.
If you fancy yourself a budding entrepreneur and have a potential money-making idea, the best thing you could do is to go into business for yourself. Setting up a small business means you’ll be in total control of your situation and finances, and will have the perfect opportunity to build your best life.
This post will help you tackle the initial steps of going solo, discuss how to develop an idea, and offer insight into what resources you’ll need. Let’s get started!
Why setting up a small business is the perfect reaction to losing your job
With more than 5 million job losses every month in the U.S. alone, it’s sadly inevitable that your number might be called at some point. Even though it may not seem like you have a lot of options if you lose your job, there are a number of things you can do:
- Find employment in a similar field.
- Find a job in a field with transferable skills.
- Work on your Netflix watchlist for a couple of weeks.
Of course, we jest about the last point. However, considering an alternative to being an employee is smart. If you’re creative, disciplined, hard-working, and financially prudent, you might feel that setting up a small business is a better idea than using those qualities to benefit an employer.
Of course, actions speak louder than words.
How to begin setting up a small business (in 6 steps)
Every situation is different, but there are six distinct steps you’ll usually need to follow to set up a small business.
Create and develop an idea.
Put together a business plan.
Plan a budget.
Make sure you’re legally compliant.
Determine what help you’ll need.
Promote your small business.
Let’s begin with some right-brain thinking.
1. Create and develop an idea
First, you’ll need to have a winning business idea. This is arguably the most vital step, as a solid vision at this point serves as the foundation for setting up a small business. Developing a poor core idea will likely mean your business fails to thrive.
As such, you’ll want to spend a while making sure your idea is viable, sustainable, and above all, profitable. Rather than simply laying around waiting for inspiration to strike, putting in the work to create and develop your idea will pay dividends.
2. Put together a business plan
Once your idea is locked in, your next step in setting up a small business is to develop a business plan to help you reach your end goals. Your plan will also assist you in securing funding for your project, and proving your legitimacy to other interested parties.
Fortunately, creating a business plan is not difficult, and we’ve covered the process previously. In summary, first think about where you’d like to be in one year, and then five years. Use these timeframes to consider your earnings, marketing, professional goals, and ideal clients.
3. Plan a budget
As we alluded to previously, it’s key to consider your finances carefully. This will essentially be the red blood cells to your work ethic’s white cells.
If budgeting and business finances are new to you, check out these articles:
- Finance basics for small business owners
- 4 website costs to consider when setting a budget for your business site
- Establishing a small business marketing budget
- Small business expense planning for your new online startup
Ensuing that your finances are on the level is necessary, but isn’t difficult with a little work.
4. Make sure you’re legally compliant
Understanding legal statuses is one area few would-be entrepreneurs are knowledgeable in. Therefore, it’s something many gloss over. However, that could easily get you into a lot of trouble.
Our advice is to put together a solid checklist outlining any aspects you’re unsure of. Essentially, ask yourself (and note) any questions, including ascertaining whether you need a business license, and what you should do if your answer to that question is “Yes”.
5. Determine what help you’ll need
Trying to handle every aspect of setting up a small business will be tough, potentially for years as you build it from scratch. Taking care of everything on your own could hamper your growth due to spreading yourself too thinly.
Of course, you may need to be a one-man band at first, although you should look to delegate tasks you don’t have the expertise for. Relying on the kindness of your friends and family is important, although you’ll need to exercise some ruthlessness by only choosing those who can actually help your growth.
6. Promote your small business
Once you’re ready to promote your small business, you might think the hard work is over. However, nothing could be further from the truth.
This is the area where your creative energies are best spent, and there are many subjective considerations to make. However, you’ll want to start with some basic rules of thumb.
There’s no doubt about it — losing your job can be a negative experience that’s hard to shake. The best counter is often to get back on the horse by setting up a small business of you own. However, if you have a potentially lucrative idea, there’s no reason why you can’t choose a different animal to ride to success.
In this post, we’ve looked to help you out of the doldrums, and into a winning situation. Let’s recap the six steps we recommend for setting up your own small business:
- Create and develop an idea.
- Put together a business plan.
- Plan your finances.
- Make sure you’re legally compliant.
- Determine what help you’ll need.
- Promote your small business.
Best of luck on your next venture!