[This article was written by Dawn Castell.]
“I want to own my own business.” That statement is more than a declaration about professional intentions. Would-be entrepreneurs wish to launch a small business because they want more than the financial benefits. They want better control over their lives. Running a small business provides more personal freedom and even peace of mind. No surprises exist why a budding entrepreneur rushes into creating a startup or buys an existing company.
The big surprise comes when the business fails. Those with experience in owning and running a business aren’t surprised to see newbies falter. They’ve seen the outcome all too often. A neophyte who thinks he/she knows the score rushes into starting up a business instead of spending time working for someone. Don’t rush. It’s better to work for someone else for a time. Here are some reasons why:
Gaining the Necessary Understanding Of The Industry
Experience allows someone to understand the nuances of a particular business sector. You might think you know it from the outside, but such a perspective remains limited. A lack of experience combined with a weak understanding of business sets a course for mistakes. Sometimes, errors prove to be devastating, and a small business may never recover. True, spending time working for someone else requires doing things the other person’s way. The tenure also provides a valuable learning experience. Consider the time an apprenticeship for eventual entrepreneurship.
Working Means Learning About Costs
Working in an office may open doors of perception about how much it costs to run a business. A worker may be stunned to learn at just how much capital an owner outlays. Rent, utilities, insurance, and other typical costs aren’t the most revealing expenses. Costs absorbed for cleaning, unexpected repairs, travel, loan interest, and more factor into play. Fully understanding all the costs allow for better cash flow planning and more realistic expectations of profit.
Examining Lulls and Down Seasons
From the land of the unexpected comes discovering a business’ slow season. A business may experience ups and downs based on the seasons. A new business owner might believe revenue remains consistent throughout all 12 months of the year. And then reality sinks in when business drops off. A resume writing service, for example, picks up business when college students near graduation. A retail store sees an uptick during the holidays. Overspending during the up seasons reduces reserves when low times arrive. A business can find itself financially challenged this way. A better understanding of a seasonal impact allows the owner to manage the startup more efficiently.
Developing a Strong Professional Network
Networking makes many aspects of business easier to navigate. Trying to do everything on your own is impossible. You certainly can’t come up with the perfect answers all the time. Turning to a trusted fellow professional for assistance can get you out of a jam. Of course, you must amass a network of contacts before you can call on anyone. Spending a few years working for someone else creates opportunities for building an all-important network.
Timing a Proper Launch Date
Starting a new business relies heavily on timing and preparation. The owner needs enough money to cover all essential expenses. The company must open at a time when capable of maximizing income and cash flow. The wrong start date could prove disastrous. Once again, experience plays a vital role in choosing the proper launch time. By working for someone else, acquired insights contribute to timing an appropriate start date. Otherwise, a shaky foundation will haunt the enterprise.
Accessing a Mentor’s Guidance
Among the best ways to learn something is to ask the person who knows. Working under a talented manager may change perspectives. Watching how the person operates provides a model for figuring what to do in specific situations. When you cannot arrive at an answer for yourself, an experienced person can provide personal insights. Classroom and self-education are great, but they come with limitations. Developing a good relationship with someone possessing a deep understanding of business and fills in knowledge-base gaps.