Starting A Business: Questions To Ask Before Quitting Your Job
The 6 big questions to answer before going for it ...
POSTED BY JONATHAN VOWLES ON 03/07/2018 @ 8:00AM
If you're thinking of quitting your job and starting a business, you may be wondering what you should consider before you take the plunge. If this sounds like you, then read on ...
If you're thinking of starting a business, make sure you can answer these questions!
copyright: stokkete / 123rf stock photo
The first point is this: if you've got the desire to start your own business, then you are in good company. Small businesses, and the people who start small businesses, are really important to the economy and make up around 50% of UK GDP and about 8% of the population.
However, having the desire to start your own business doesn't mean that it is a good idea! What questions do you need to ask yourself?
Do you have the money?
Equally importantly, how long can you survive without a regular paycheque? Most business start-ups don't have a regular enough income to take cash out of their business to begin with. Profits and income will rise, but it might take a while to get enough.
Do you have passion?
You need to have passion and fire for your business idea. Starting a business can be hard. Do you have what it takes to keep going when the going gets tough? Passion by itself isn't enough - you need drive and determination, but also you need a direction to go in; you need a plan.
Do you have all your ducks in a row?
This is your reality check moment. OK, so you've got a business idea, but have you done your planning and research? Do you have a plan? Do you have or can get the correct licenses, insurances, training, etc.? What business structure is right for you?
What are your start-up costs?
Have you worked out how much money you need to start and how much you need to keep going for the first year? What does your cashflow forecast look like? Can you borrow? Can you lease your computers, phones, equipment or machinery? Will you be able to factor your sales to fund your startup?
Where can you get finance from?
If you need money, consider getting a remortgage before you quit work! Once you have started your business, you are unlikely to get a loan from a bank for a couple of years. So, what are your savings? What can you get from other sources?
If the worst thing happened, would you be OK?
This is your safety check moment. Not every business survives the first few years of starting up. A big proportion of startups fail. If your business failed, would you and your family be OK? Have you kept enough money back to cover your mortgage if it all goes wrong? How easy would it be to get another job?
So, having thought about these questions, are you ready to quit your job and start a business? And yes, starting your own business is a leap of faith into the unknown, but if you have the plan, the finance, the will and the passion then you have the right ingredients.
"Would you like to know more?"
If you'd like to find out more about starting a business and the questions you need to ask yourself, do give me a call on 01234 752 566 or click here to ping me an email and let's see how I can help you.
Until next time ...
More about Jonathan Vowles ...
I've been an accountant in and for business since 1987 and have a wide experience of consultancy, audit, accounts, taxation and wealth planning work from individuals and small businesses to multinational corporations and charities.
My eclectic interests in growing and developing business span a number of areas, which can be summarised as strategic business advice and tax saving advice.
I have worked with the Chamber of Commerce to deliver courses for people about starting up in business and have lectured about tax for a major accountancy practice and for Milton Keynes College.
I relax by reading fiction and by getting away from the office in a campervan.
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