Owning a business is most people’s ultimate dream. You can be your own boss, manage your time and work for nobody but yourself. No wonder why people want to be a business owner.
However, while being the boss of your own company can seem ideal, most people aren’t prepared for the demands of starting a business requires.
What do you need to start a business? To ensure you start and maintain your new venture, it’s essential to have these five things at hand.
- An Impeccable Credit Card
If you have credit card debt or your credit score is not at least CC (AA-HH scoring system with AA as the best and HH as the worst), you’re not ready yet to start a business. How do you expect to manage your business operations when your personal finances are not in great shape?
- Good Timing
Picking the right time to launch your business is an action determined by many factors, including the success and failure of businesses in the same industry, the ebbs and flows of the market, availability of your funds and your personal situation (pregnant wife? Maybe it’s best to delay your plans for the meantime. Not having a baby anytime soon? Get on your new venture now.)
- Knowledge About Operations
You should know the ins and outs of P&L statement. Haven’t heard of that? It’s a shorter term for profit and loss, and that’s vital for every business especially the start-ups. It’s also important to understand the tax rules of owning a company. Look for a business development program in your place. These non-profit establishments, which are usually housed at universities and colleges offer trainings and classes to help future entrepreneurs.
- A Clean Start-Up Budget
It can take a year—or even more—to establish a business and start getting revenues on a regular basis, so you will need a cushion to keep your business running. However, your business savings should be separate from your emergency fund and should have nothing to do with your home equity and retirement accounts. Leveraging your home or using your personal savings is too risky and should never be an option.
- Sharp Social Skills
Lucky for you if you know several people in higher position in the industry you’re in. You are a step ahead from a lot of business start-ups. If otherwise, being committed to growing your network and constantly looking for opportunities to make connections is one of the most important parts of your job description.
Yes, you have to do things that make you feel uncomfortable (like talking to people you don’t know and socializing with the elites) and you need to do some sacrifices (like going on a diet to save for your start-up budget). Patiently and whole-heartedly doing all these things might just make you a millionaire in two to three years. You’ll see, the effort and sacrifices you’ve invested will be worth it.