How to Start a Successful Business Even in a Recession

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Starting your own business is never easy in the strictest sense of the word “easy” because there is plenty to think about, and lots to do. Just ask anyone who has already gone down that path. They will have soon discovered that getting the right product or service, to the right market, and in just the right way is no easy task in itself, and then there are legalities, training, costs, staffing, premises, health & safety issues and many, many other aspects to consider.

WHEN to start a business is another matter. And one that I shall deal with separately because it may matter a great deal more than any of the above, depending on the economics of the region/country you are in, and on the real or perceived financial security of markets across the world (especially if yours is a global rather than local marketplace). So, is starting a business a good idea in a recession? Well no-one has said that we are in a recession, although there is lots of talk about the “credit crunch” and the “economic downturn”. Naturally people fear the prospect of a “recession”. People fear losing their jobs and their financial security in tough economic times. Companies do actually downsize, people can find it more difficult to find a job, and in any case, job security (or a “job for life”) is no longer truly viable (with or without other economic pressures being exercised).

Starting your own business means that you are the boss; there is no-one to hire and fire you, because you run the show. Starting your own business means that you make the decisions; so provided you are making well-informed and prudent decisions, they will always be the best for your own financial security. So I would say, YES, now is a GOOD time to start your own business – but NOT just any old business. Many small businesses fail due to lack of training, lack of support, lack of relevant skills or knowledge of the market and by pure bad timing, bad management or bad luck. In order to avoid the pitfalls, (at any time but particularly during the tough times), you would have to carefully consider the following points:

FINANCES

1. Does your proposed business have Low Start Up Costs?
2. Does it have low running costs?
3. Does it have low overheads?
4. Will it need additional staff – or can you run it yourself?
5. Will you need to pay for training, or to acquire certain skills?

THE MARKET

1. Is there a market for this particular product or service?
2. How big is your market, and is it local, national or international?
3. Who is likely to be your customer?
4. Is this a repeat product or service, or a once-only potential customer?
5. What is the competition like for your business products or service?

YOUR SKILLS

1. Will you be able to realistically cope with what the business requires?
2. Can you work hours to suit yourself, or will you need to work more hours than you can possibly provide?
3. Have you the necessary skills for this business – or will you require training?
4. Apart from the cost of any necessary training, how easy is this to access? And will it take you away from running your Business, at all?

Ideally, you need to find a business for which answers to these questions appear to be thus:

FINANCES

1. Yes – Low or Very Low Initial Start Up Costs
2. Yes – Very Low Running costs (looking at a monthly outgoing which can be easily covered from your own “other” funds to start with, or at least being realistically recouped within the first 6 months at least. You have to decide how long you can run a business without making a profit…. Check your finances!
3. Minimal overheads – and these can be avoided altogether on some months wherever possible.
4. NO – additional staff are NOT required. You should be a sole trader or partnership only without need to employ any other people to make your business a success
5. Look for a business which requires little or no training (something you already know, or is quite easy to pick up); training should be available FREE if required or at least you can access relevant training materials online etc without having to spend loads on acquiring necessary new skills for the business

THE MARKET

1. You need a huge, global marketplace to reach the maximum potential clients.
2. A global market place which can be reached easily via the internet
3. What if your product appealed to as many as 9 out of 10 people!
4. You need a daily consumable, repeat product for maximum sales with most potential profit
5. Something with little or no competition, (eg. how about a unique world-patented product with exclusive marketing rights?)

YOUR SKILLS

1. Well, what if the Business was all about something you know already? For instance, CHOCOLATE?
2. A business which offers totally flexible hours with no targets, ever. Work an hour a week, or 40 hours a week. Full or part-time. The choice MUST be yours.
3. Find something easy (you already know about, or it’s easy to pick up quickly) and yes – where there is FREE training, if required
4. All training should be easily accessed from wherever you are; internet access is really all that you should need plus a little “mentoring” or support would help

If you are thinking of starting your own business, NOW or in the future (with or without an economic downturn) then considering these points will help you to succeed.

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Source by Teresa Steventon