Consistent with the theme of hope that spring brings, I am beginning to see some people getting up off the deck and moving in a positive direction during this economic maelstrom. People who have lost their jobs or had their income cut are thinking about starting their own businesses. Cottage industries are coming back as a means to supplement incomes. Here are some thoughts on starting a business.
- Consider forming a corporation or limited liability company to insulate against most personal liability. Don’t bet the family’s assets on a new venture. Partnership considerations should be addressed in the formation stage.
- Create a written business plan. There are many good software programs to do so and some free help online. There are also advisors who are experienced in helping create a plan. It is easier to get where you are going if you have a guide. Make sure all partners buy into it.
- Along with your business plan, which should have realistic goals, write down your personal, financial and other goals. Make sure the goals are measurable. Goal setting is a struggle at times. I have been doing so pretty faithfully for the last 6 years, but it recently took 4 months for me to re-address my goals. Challenge yourself to decide what you really want and how you are going to get it.
- Do background and business checks on partners as to character and experience.
- Consider hiring a good accountant and one who will help you learn the financial aspects of your business. A good small business bank is also useful in this regard.
- Have enough money set aside to keep you in operation during the ramp up period. Do not, unless you have a sure thing (and even then reconsider), use your protected funds, e.g. retirement funds. Do not rely on credit cards, and do not offer personal guarantees. These last two items have caused grief to all of the people with whom I am counseling on financial matters.
- Don’t let the naysayers get to you. When I started my law firm over 20 years ago during another recession, many discouraged me from doing so for lots of ‘good’ reasons. Fortunately, my faith in myself was stronger than my faith in others, no matter how well meaning.
- Test the waters before going ‘whole hog.’
- Consider hiring a business coach.
- Learn something about marketing. Seek advice from people who know how to do it.
- Get a good insurance adviser and, lest I forget to mention it, lawyer.
If you need referrals to any of the above, don’t hesitate to ask me. I believe in referrals. Written by Attorney Irving Hymson, firstname.lastname@example.org
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