Part IV

Savoring Small Business

Top 5 Keys to Maximizing Your Chances for Small Business Success

• Understand the risks and impact. Running your own small business or buying an existing small business is one of the three proven ownership investments to build wealth. With the potential for high returns, however, comes greater risk — and that risk includes what happens to your employment and work income should the business not do well, including failing.
• Assess your small business acumen before taking the plunge. Not everyone is cut out to succeed at or enjoy their own small business. Don’t get seduced by the notion that being your own boss and setting your own hours can lead to great fortune. In the early years of your business, you’ll probably work harder than you expected and make less than you hoped.
• Understand and explore alternatives to starting your own business, such as buying an existing business or investing in someone else’s small business. Also consider working at a larger company where you can do something entrepreneurial inside the firm. And remember that no matter where you work as an employee, you can invest in your own career and improve your worth to your employer.
• Before pursuing your own small business, draft a thorough business plan. This plan should detail your business concept, your objectives, the marketplace you’ll be competing in, how you’ll deliver and market your product or service, staffing plans, and financial projections.
• Before starting your business, assess your overall financial situation and how you’ll replace important benefits such as personal insurance coverage. Also consider how you’ll finance your business, what type of business entity you’ll use, where you’ll operate from, how you’ll find and keep customers, and what type of accounting system you’ll use.

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In this part …

• Explore the investment opportunities of your own small business by developing a business plan, identifying marketable products or services, finding customers, and understanding and beating the competition.
• Consider your options and do due diligence if you prefer to buy an existing small business instead of establishing your own.