It is not a surprise that the UK’s economy has significantly changed since the start of the pandemic, with large numbers of employees furloughed under the government scheme. We are now slowly moving towards restarting the economy, what will be the implications in the job market be as we are moving into 2021?
The Mckinsey & Company report on the effects of the Covid-19 on jobs suggest over 7.6 million jobs are at risk across all employment sectors, with the most significant potential loss could be in the accommodation, service sectors and retail. These are often the sectors in which the would-be entrepreneur might consider starting their small business. It is unfortunately likely that there will be groups of highly skilled individuals wanting to perhaps take their first step into self-employment and a new business venture, is it the right thing to do?
Taking the step from employment to being your own boss can be a daunting one, but it is not necessarily such a significant change as you might expect. With the right sort of formal business plan, you can pick up many of the skills you might need along the way. All entrepreneurial business people need to acquire skills as they go, so don’t let not being an expert in all aspect of running an enterprise hold you back. Who are the true entrepreneurs, remember both women entrepreneurs and men have the winning characteristics. Just remember that everyone needed to start somehow and your success or failure will rely much more on what you are offering your customers than anything else. If you have a successful customer proposition, then your business is likely to succeed. To get things going, consider the following seven steps that all new business owners should take into account before they take the plunge.
The Entrepreneur’s Mindset
The entrepreneurial mindset is a given for today’s successful business leaders. Basically, the term refers to a state of mind which focuses explicitly on human conduct towards business activities and positive outcomes. People who possess entrepreneurial mindsets are not necessarily born with them but have developed them over many years. They are individuals who are commonly drawn to a variety of opportunities, not just business ones. They will also usually favour innovation and have a strong sense of valuing creativity. If you don’t think you are a natural entrepreneur, then you can assess yourself with various psychometric tests which will give you a less subjective indication of your abilities. Alternatively, simply ask yourself the following questions: Are you resourceful? Do you take on challenges or shirk them? Do you welcome or run from change? Are you the sort of person who seeks oversight, or do you get on with things and worry about the consequences later, do you have the entrepreneur characteristics? Is the owner age a barrier to starting their own business; the answer is NO!; the over 40s entrepreneur is more likely to be successful than those in their 20s.
Entrepreneurial characteristics
- Drive and energy – the entrepreneur’s labour and passion are critical factors to being a successful entrepreneur.
- Self-confidence – recognise their internal fears but have the self believe in their skills to be successful.
- High initiative and personal responsibility – self-motivation is a key factor in being a successful entrepreneur.
- Internal locus of control -understands the entrepreneur human element in developing the business.
- Tolerance of ambiguity – recognise the need to make decisions without always having the full facts.
- Low fear of failure – understands that everything they do will be successful.
- Moderate risk-taking – calculating the value of their particular actions.
- Long-term involvement – this is the relation between the entrepreneur and the others involved in the business.
- Money as a measure not merely an end – the passion and entrepreneur internal success is also important.
- Use of feedback – use continual discussions within and outside the organisation to grow the business.
- Continuous pragmatic problem solving – use problem-solving techniques to resolve issues.
- Use of resources – the relationship between the entrepreneur and the using the employees’ skills and expertise.
- Self-imposed standards – the highest stands in all aspects of the business
- Clear goal setting – so that everyone within the business knows the direction and goals you are aiming to achieve.
If you want to develop an improved entrepreneurial mindset, then think about the strategies you make in daily life to give yourself an edge or an advantage. Thinking logically and methodically can help you to develop your business acumen, so try doing this in all aspects of your life in preparation. Also, work on tactics that give you a cutting edge. Think about ways you might beat an opponent in a game or sporting match. Don’t just rely on your overall effort, but try to out-think your opponent. Lastly, when developing an entrepreneurial mindset, you should consider ways of seizing opportunities as they come along. Entrepreneurs tend to be pragmatists, which means that they are just as likely to abandon a plan; if the conditions are advantageous for them to do so. They do not stick to a strategy through thick and thin. Playing strategy and business games are great ways of picking up and improving these skills.
Analyse Your Current Skills and Produce a List of Strengths and Weaknesses
The skills that you have listed on your CV are probably an excellent place to start when thinking about your various aptitudes for running your own business. However, you may have many more transferable or soft skills than you give yourself credit for. Perhaps you are qualified for a specific line of work, but also do much more in that job role than you realise. An example could be anything from liaising with clients to working with colleagues to get the best out of them. Sometimes these sorts of softer skills are undervalued and underpaid in the workplace, but you will need them all when you take the step to begin working for yourself. To understand what you can bring to fore as an entrepreneur, it is a good idea to make a list of your key strengths and measure these against the traits of successful entrepreneurs.
As mentioned, you should list all of your transferable skills. These commonly include things like professional conduct in the workplace, being able to communicate effectively and computer skills. By thinking about your transferable skills for a few minutes, you will probably come up with many more items to list than you had expected. Remember that transferable skills can be used in more than one sort of working environment. Think about your abilities for working within teams, dealing with customers and taking on responsibilities under your initiative.
Along with your transferable skills, list all of your job-related skills. This will include things like your professional qualifications, such as graphic design skills or knowledge of specific technical systems. Your job-related skills will be connected with the sort of work you have done in the past and what training you have received. Remember that any expertise you currently possess can be a big part of your future, depending on what sort of business you intend to launch.
Finally, in your list of skills, also include your so-called adaptive skills. These are sometimes forgotten about merely because they are harder to quantify. This is because they cannot always be demonstrated directly from your work experience. In reality, they are often more reflective of your personality traits. Adaptive skills include things like having a positive mental approach to work, the ability to problem-solve and of being able to adapt to new situations effectively.
Against your exhaustive list of strengths, it is also essential to factor in any weaknesses you might have. There is no point running a business which means you are going to be up against one of your weaknesses from the moment you start. Why begin an early morning cleaning service if you know that getting going first thing is a problem for you? Equally, if you are not the best with numbers, you probably don’t want to run a fully commercial sort of business, such as mortgage broker. Taking into account your deficiencies in an honest way can be very empowering and help you to focus on the next stage.
Brainstorm Business Ideas and Options
If you jump into the first business opportunity that comes your way, then it might work out for you. However, it is much better to take a considered approach to launch yourself as an entrepreneur. It is because you will be much more suited to certain types of enterprise than others – it naturally comes down to your personality type. Having made a list of your skills and weaknesses, you should be much better placed to work out which sector or sectors of the economy you are cut out for. Nevertheless, there is more to it than that.
Brainstorming your business ideas will often help you to focus on what it is you are going to do next in your career. Do you, for example, have a passion for research and development or inventing things, in which case a startup company may be right for you? Alternatively, you may have sufficient capital to purchase a going concern and reinvent it in your own style, perhaps because you have excellent skills already in brand building. If you are not the greatest with marketing but know how to get a team of staff operating efficiently, then perhaps buying into a retail franchise will be for you?
Many people look at the franchise model because the franchise owner should be able to demonstrate the success of their business model and give guides in setting up the business. You will also have the opportunity to discuss with existing franchisees, their personal view on the business model, to provide you with a better perspective, on whether this is the ideal, business route for you.
The online business model has developed with high speed during the pandemic and is the route many would-be business owners, have taken. The cost is significantly less than finding retail premises. There are many online shop providers to help you develop your online presence; these platforms will help you in the building of your online shop. These platforms are suitable for selling services or products. However, the customers will need to find you! You will require you to advertise your venture on platforms such as Facebook, Google and Microsoft Ads. The online shop provider will help you improve your visibility on the web by improving the SEO (Search Engine Optimisation) of your shop web site.
Remember that before you start your new venture, you retain many opportunities to change things and to make new ideas happen. Once you have committed time, effort and – above all – money into your business, you will find that it is much harder to stop and go in a new direction. Before you are fully committed to a particular path, spend time working out all of your options. It is always worthwhile to discuss all the options before deciding a business owner, whose opinion you trust and value.
Do the Finances
Buying a business takes money. If you want to work for yourself and purchase a company that is already operating, then you are going to need some working capital. Even if you are opting for a startup company, you might have initial costs for equipment or premises. In any case, while your business is in its development stage, it may be that it simply generates no income for you until the orders start to roll in. In this case, you will need to consider what money you have to live on until things get going. Before starting a business, work out how much money you have, what assets you own that you can borrow against and the length of time you can survive before you start to see a return on your investment.
When considering borrowing money, it is always beneficial to consider what interest rates might be in the future. At the moment, borrowing rates a relatively low, but this might not always be the case, and the cost of loans taken out earlier might go up. Remember that banks are not the only place you can raise working capital for a startup or for buying a going concern. Consider taking on a partner who has money to invest or looking for venture capital investors who are sometimes more willing to risk their cash on creative or novel business ventures.
Grants and bursaries may be available to you through government-run schemes, and charitable foundations, such as the Prince’s Trust. This avenue of funding is especially worthwhile if you are young or happen to work in specific sectors of the economy, such as cleantech startups, for instance.
Develop a Business Plan
Developing a business plan does not mean you are committed to one path only, but it should offer a written description of how you view your company’s future. This will help you to keep an eye on what the longer-term picture is for your business when you subsequently get bogged down in the day-to-day business of running a company. Ideally, the plan will be a document that informs you and others of what you have planned to do and how you intend on going about making it happen. A business plan should be something that you can show to investors which shows them the potential of your business. Any bank proposing to lend you money to buy equipment would expect you to have one. However, they can be created easily by using from using business plan temples. Even if you were to note down a few bullets on the back of an envelope, then you have created a business plan, so long as it describes your commercial strategy.
When developing a basic business plan into something fuller, it should be increasingly strategic in outlook. A good plan will state what you are going to do in the first year and then the next three to five years, but it should also detail how you are going to go about achieving your plan. If you want to be the top operator in your sector within five years, then your strategy is likely to feature things like competitor buyouts or plans to develop new products or to sell existing ones into new markets.
For newcomers in running businesses, then an action plan for the first 90 days of the business can be very helpful. A three-month-long detailed plan can be crucial for getting past the initial phase of a business when you tend to face the most considerable costs and risks. By making sure you know what you plan to do in the often hectic first 90 days following launch, you are much more likely to stay on track and end up with a successful business.
Launch the Business
Business launches are not for slapping yourself on the back and sipping a glass of bubbly, although you should feel a sense of achievement for having got this far. Think of a business launch as a key marketing opportunity. Many people are simply attracted to the feeling of novelty that a new business, or a business re-launch under new management, brings. However, if your launch fails to hit the target, then you will have little impact on your potential customers and clients.
When launching a business, make sure that every one you might want to reach knows about it. This might mean holding a launch party or inviting guests to come and see what you are up to. Doing so after you have been operating for six months probably won’t work as well. Use your launch to sell yourself, your brand and your new business. Remember that competitors are likely to take an interest in what you are doing, too, so don’t be too transparent with your business model, but present the side of it you want customers to focus.
When launching a business, try to get as much publicity as possible. If your budget does not extend to radio and TV advertising campaigns, then at least leaflet your locality to let people know they can now access your services, if wanted. Write a press release and send this to local and national newspapers. You may even get some publicity for your company for free this way, especially if there is a newsworthy angle, such as raising money for charity at your launch. Remember that a launch will be a busy time for you, but make an effort to connect with potential clients personally. Take on board any feedback you obtain from your would-be customers, even if it is negative. By responding to their first impressions positively, it may be possible for you to alter your plans for the better.
Monitor Against Targets and Make Changes
Once you have your business is off the ground, it is essential to monitor what is going on with the enterprise. This doesn’t simply mean focusing on your small business growth of sales and turnover figures, although these are certainly both worth knowing. You must also make sure that your costs are entirely under control. Many new businesses fail because their owners have not paid sufficient attention to how much money they are spending. Get out of any long term contracts and commitments to spend money in the future. Make sure you can account for every penny of expenditure and cut off additional spending, where it is not business-critical.
It would be best if you had laid out several targets for your enterprise in the business plan. As well as running the day-to-day aspect of the business, it is essential to measure your performance against these goals. Identifying where you are under-achieving should reveal the parts of your business you will need to focus. For example, perhaps your product sales are on target, but your aftercare warranties are falling behind. If so, you ought to be thinking about what you can alter at the point of sale to make this sort of up-selling more appealing to your customers. All businesses need to go through restructuring and changes to make sure they remain at the cutting edge. Only by carefully monitoring your targets and key performance indicators will you be able to know what to keep and what to alter.
Ultimately, running your own business is a never-ending job. Still, it can be an utterly rewarding thing to do, if you have the entrepreneur characteristics and especially if you are willing to commit to the constant changes that all businesses need to survive in the long term
