Entrepreneurship

Basic Skills Ease Start-Up

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A few years ago you could elbow your way into business with a sharp pencil and a calculator. Technology has changed all that. Now it’s hard to imagine writing a business plan or running a business without a computer, email, and the Internet.

A few basic skills in the following areas will make it easier to start or grow a business.

1. Computer. A decade ago, just 10 percent of my business-planning students knew how to use a computer; today more than 90 percent are computer savvy and almost all own computers. If turning on a computer still causes beads of sweat to form on your brow, and if you’re planning to own a business, it’s time to bite the technology bullet and learn how to use a computer.

2. Email. Email has revolutionized business communications. Got a quick question for someone in a different part of the globe? Need an efficient way to communicate with your customers? Want to get a research document mailed to you, fast? Email makes these and many other tasks easy and inexpensive. If you can manage file attachments, you will save even more time and energy.

3. Internet. You have, at your fingertips, a vast global library. Search engines are now simple enough that you can practically teach your pet ferret to use them. At this writing the US Census population counter indicates there are more the 6.7 billion people in the world; one click later another favourite site reveals that more than 1.4 billion are now using the Internet. For business owners, the Internet is the ultimate source of information, whether for market research or to keep tabs on your competitors.

4. Word processor and Keyboard. You can probably get by without these skills in today’s environment, but it’s bound to be limiting and costly as you hire others to compensate for your lack of expertise. If you’re hunting and pecking your way into business, a tiny investment in learning how to keyboard will definitely help. If you simply wish to improve your typing speed or accuracy, you can download any of a number of free typing tutor applications from the web. It seems that most businesses use Microsoft Word™ for word processing, but there are other applications available. For example, Open Office offers a free downloadable option called Writer, available at www.openoffice.org.

5. Spreadsheet. When it comes to determining whether or not your business will make money, a spreadsheet will definitely reduce your stress level. You don’t have to know how to design complex worksheets in order to enjoy the benefits. All you really need are a few navigation skills and some reliable forecasting templates. Most businesses use Microsoft Excel™, but OpenOffice also has a great spreadsheet called Calc (Did I mention it’s free?).

If you’re planning to start or grow a business, or simply looking for ways to make yourself more employable in today’s job market, these skills are sure to benefit you, both immediately and over the long term.

Owning a Business

Are You Starving Your New Business?

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If you’re thinking about starting a business, you will need to ensure your basic living expenses are paid while the fledgling business takes root and grows to where it can support you.

In a perfect world, your business would support you while you work to make it successful. Unfortunately, most start-up businesses do not earn enough for the owners to pay themselves. For most, this means planning to pay your personal expenses some other way until your business can afford you.

The first step toward solving this dilemma is to determine your basic personal financial needs. Make a list of all personal and household expenses that need to be paid each month for the first year the business will operate.

Next, scan your financial horizon to determine how the personal expenses will be paid for at least the first year in the life of your business. Here are some possible sources of funding for your personal expenses:

1. A part or full-time job. Many businesses are started while the owner works for someone else.

2. Support by a spouse or parent. The perfect time to start a business might be while someone is paying all or part of your household expenses.

3. Buy-out or severance package. People are continually displaced from the workforce as a result of business closures, changes in corporate policies, downsizing, rightsizing or early retirement. Regardless of the reason for the layoff, a buyout package can provide the cash you need to jumpstart that little enterprise you’ve been thinking about.

4. Self Employment Benefits (SEB) Program. Bless the Feds and the distant planet they inhabit. The SEB is a wonderful federally funded program that grants EI eligible entrepreneurs enough money to pay personal expenses for up to the first year of a new business.

5. Secure a long-term major client or two. New businesses are often brought into the world when someone falls into an opportunity in the form of a lucrative contract.

6. Sell assets. For those with the good fortune to have assets to sell, doing so can inject the funds needed to nurse a new business through the start-up phase.

7. Pension. More and more it seems, aging baby boomers use their pension as a base from which to launch a new venture. This can be driven by necessity or by a desire to create a certain lifestyle.

Those unfamiliar with business often have an unrealistic expectation that a new business should instantly be able to pay its owner a handsome salary. The reality is that most new enterprises are allowed to take root because the owner is able to leave cash in the business until it grows.

Any other ideas to offer?

How did or how will you avoid starving your business?

Self-Employment

Are You In Business or Enslaved to Self-Employment?

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Oddly, the ultimate goal of self-employment might be to work yourself out of a job.

Many people start businesses simply to create jobs for themselves. Self-employment offers many benefits, not the least of which is the opportunity to develop basic business trade skills, while getting paid for work you love to do. Self-employment is everything some owners want, while others use it as a stepping stone to build sustainable, stand-alone businesses.

What’s the difference between self-employment and being in business? Here are some signs that you are self-employed.

1. You are the business. When customers think of your business they think of you, and they usually count on you to be one delivering the goods.

2. You might be tied to a roller coaster, feast and famine schedule. You work long hours while contracts last and you’re unemployed when they end. You are at the beck and call of your customers and dare not turn down any jobs because you never know when they might stop coming in.

3. Your pay-cheque is tied to the amount of hours you personally spend serving customers. When you stop, the revenue stops; when you get tired the business stops.

4. You spend all or most of your time working in the business, with no energy left over to work on the business.

5. You likely don’t have financial systems in place, probably do your own bookkeeping, and treat your accountant to the occasional shoebox bulging with receipts. You fly by the seat of your pants for the entire year before finding out if you’ve earned a profit.

Here are a few indicators that a business owner is moving beyond self-employment and on to building a business.

1. The business is separate from the owner. Customers don’t necessarily expect the owner to be on the front line. The business takes on more of a team approach, involving people who share the owner’s vision, mission and values.

2. The team will necessitate human resource responsibilities, systems and processes. Jobs have written descriptions and are staffed by the right people, instead of the other way around. The owner’s job shifts from the front line to leading the team.

3. Although the owner will probably still work a considerable number of hours, his pay-cheque is not limited to the number of billable hours worked.

4. While the owner might still choose to work in the business, more time is invested in designing systems for efficiency and growth.

5. The business has proper accounting and financial controls, with regular monthly financial statements and methods for tracking the flow of all monies in and out of the business.

The transition from self-employment to business doesn’t happen by accident. It is brought about when the owner consciously decides to invest in building the systems that form the backbone of the business. Once the infrastructure is in place the owner will be positioned to reduce her work hours, or possibly even sell the business and move on to other pursuits.

Human Resources, Self-Employment

Age or Attitude

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age-attitudeA decade ago, I cheerfully plunged into the second half of my first century on this terrestrial plane. I used to view anyone over the age of 30 as “old.” Today, my more than 60-year-old eyes see very little age difference between myself and my 80-year old parents.While I have the good fortune to be self-employed, I see more and more baby boomers being displaced from the work force. Downsized, right-sized, fired, bumped, replaced, early retired, bought out, kicked out or given the hairy handshake (not many folks seem to get the golden handshake anymore). A slap on the butt and it’s out into the big world.

What do you do with an unemployed baby boomer? I had a fascinating chat with a friend recently who is in his mid-fifties and is competing for a number of management level jobs after 25 years in business for himself and a one year sabbatical. After reaching the very short-list and losing a few major competitions, his question was, “Does age count?” Continue reading Age or Attitude →

Your Business. Your Plan. Your Way.