If you are thinking about starting your own business, there are probably certain things you are expecting. You are looking forward to making your own hours and working for yourself, for example. Most people start businesses with the hope and expectation of bringing in more money than they did with their 9-5 jobs. However, you probably also expect to face some hardships and uncertainties along the way.
However, there are some things that you may not realize are coming until you experience them. In many cases, they may have been convenient to know ahead of time. Many businesses don’t make it past the first year, and advanced knowledge of what is to come may be able to prevent some of those failures, including yours. Here are six things people don’t tell you about running a business.
You Need More Money to Start Then You Might Think
As you step into the great unknown of running a business, you know that you will need start-up funding. Unfortunately, however, many companies fail because they don’t have enough capital at the outset. This is because too many new entrepreneurs think that all they’ll need is enough to get through the launch, and then their profits will carry them from then on.
Unfortunately, in most cases, this isn’t what happens. For one, you can run into cash flow issues. If your clients don’t pay on time, or if they do but the waiting period runs past when you need to pay your bills, then you could be in trouble. You should be factoring in your costs several months in advance. That way, if your profits aren’t as robust as you are going, you will have something to fall back on.
You Will Make Mistakes
You should never expect to be perfect. When you look at other successful businesses that seem like they have done everything right, that is usually just perception. In reality, being successful involves being wrong many times and learning from those mistakes. The key is not to let the mistakes drag you down. You may be disappointed and think you don’t belong as an entrepreneur. The truth is that every entrepreneur has made errors, some of them massive. If you take the lesson and make sure never to repeat a mistake, you will be okay.
Insurance is Crucial
Never underestimate the importance of insurance. Your business could be humming along, bringing in significant profits while you are having the time of your life. However, it only takes one bad thing to bring everything to a screeching halt. If a customer gets injured on your property, or if you or an employee makes a mistake when providing a service, you could find your business in big trouble. Even a small lawsuit can cost hundreds of thousands of dollars if it continues too long. The right business insurance will protect you from the costs of potential hazards that could ruin your business. Make sure that you buy insurance for your business before you launch to be fully protected at all times.
There are several types of coverage that you will need. Just about all businesses should have some kind of general liability to protect against personal injury lawsuits. You should also have commercial auto insurance if you have vehicles or use your own vehicle for work-related tasks. If you have employees, workers’ compensation is required by law in all states. In addition, you may wish to consider getting a key person life insurance quote if you rely heavily on one key person. This will cover you financially if they can no longer work. Service-related businesses should have professional liability coverage in case an error causes losses for a client. Finally, life insurance is an absolute must for small businesses and we highly recommend getting a quote to get the best rate and coverage you can.
You Will Be Competitive
You might be a laid-back person, but owning your own business will most likely change that. You will find that you are watching what everyone else is doing and figuring out ways to top it. Even if your own friends own other businesses, you will try to beat them. While being competitive is essential, you also need to stay within yourself. Make sure that you focus primarily on what you can do to improve your business, and leave worrying about your competition to your competition.
Your Work Hours Will No Longer be 9-5
If your goal is to start your own business so you can rake in cash and make your own hours, you might be in for a rude awakening. While you might get there eventually, owning and running a business is hard work. While you can definitely leave your 9-5 job to focus on your company, you can’t expect to work the same hours. You can expect to work long days taking care of paperwork and making calls to partners and stakeholders. Your weekends might be filled with extra tasks and preparing things for the upcoming week. If you have employees, you will have to fill in for them when they are sick. You can find the life you are looking for, but you need to be prepared to work hard to get there.
A Mentor is Incredibly Valuable
You might think that you know it all, except that this list is proof that you don’t. What better than to have someone in your corner who has done it all before and can give you some much-needed advice and guidance? They may look at things in different ways and from different perspectives. They may even be able to help you with networking and finding partnerships. Whether it’s in an official capacity or just as a friend, having a mentor can be the difference between failure and success.
Starting a business is exciting, invigorating, and, yes, terrifying. While you can prepare yourself very well, there will always be things that you don’t expect. There will be bumps in the road, and the best thing you can do is navigate them and move on. As you build, start, and grow your business, keep this article in mind at all times. If you know what you don’t know, then you will be better equipped to face any challenge that comes your way.