Have you always wanted to start your own business, but had no clue where to begin? Read on for some practical and expert tips on how to become your own boss.
Many people want to start their own businesses, and for different reasons. While others want to call the shots via virtual meetings while on holiday, others see a gap to monetise in the market, and some want to secure a financially stable future for their children. Whatever your reason, it is important to start with a strong foundation, that includes passion and perseverance, upon which to build the success of your entity.
Take Farah Fortune for example – the Johannesburg- based founder of African Star Communications, a corporate and public relations company that looks after celebrities like rapper Solo plus comedians Trevor Gumbi and Jason Goliath. It offers event management. Why did she want to start her own, successful business?
“I was inspired by the need to provide a better life for my daughter. As the business started to take shape, that never changed. But, I also realised that it was not just a business; it was a tool for change. Before that, I was working a full-time job with a set salary and no time for freelancing, so it was a means to an end.”
Businesswoman Leah Molatseli from Bloemfontein, Free State, is the founder of Lenoma Legal, a tech company that specialises in commercial and labour matters for small to medium businesses. She started her business because she wanted to spend more time with her children, and have more control over her time. If, like these women, you are ready to have your business card read founder and CEO, here is your guide from our business experts.
The aha idea
Any product or service starts with an idea. But, what makes some ideas more successful than others? Johannesburg-based business coach and founder of LIH Management Company Penny Shozi says, “The main reason for a business to exist is to satisfy a customer need. It, therefore, makes sense that the best business idea would be one that is designed to fill a gap or client need. You can find this by analysing a particular market, and defining the demand within.”
Business and personal development coach and founder of Ziveze Coaching Services Patisa Nombakuse adds that business ideas should come from solving a particular problem. They arise from passion, the areas of your strength and frustration. “Identify a problem, even if you enhance an existing solution, and make it better. We are born with gifts and talents that only we can do better. Only you can solve that problem," Nombakuse says.
"Explore what you really enjoy, what you talk about all the time and always complain about. Finding solutions to societal problems can turn into business ideas that can generate income where people are willing to pay for it,” she advises.
Exit strategy from full-time employment
It can be difficult to focus on building and growing your business part time, especially if your job is a demanding one, and when children are involved. But, if the bug bites, Shozi advises that you build a demand and the sustainability of your business.
“In some instances, if possible, start working on the business while you are still employed full time so as to build the client base. Establish your niche without compromising your current full-time position. The transition may be gradual as you begin getting into the business.
This requires the utmost dedication and sacrifice in most cases as you work through your concepts and business plan. A detailed business plan is critical, which clearly defines the viability and sustainability of your business.”
Nombakuse adds that since life comes with no perfect formula, you have to trust your idea and yourself. “Major events, such as retrenchments, an unbearable job, a search for a purpose or divorce, can push you to what you really want in life. But, to formally answer this question, do not follow your passion against all odds.
The reality is that you still have to live, pay bills and self-sustain, and at times you have a family to feed. You need a calculated plan. Set SMART (specific, measurable, achievable, relevant, time-based) goals while you’re still employed. Identify how much time it will take you to build reserves, such as saving money and paying off debt, while getting the support you may need in the transitioning period. Hire a coach and talk to people who have done it before.”
Draft a clear business plan
While business plans may seem too formal if you’re starting small, Shozi says they are very important as they’re the cornerstone of your business. They will help you see clearly where your business is going, and how you will get to the desired results. “The main reason businesses exist is to make profit. The business plan is the tool used to show where that profit or desired outcome will come from.”
Nombakuse adds that it should address the following areas: Create a summary that defines your products and services, target audience and company goals.Define your products and services in detail, including technical specifications and pricing.
Build a marketing plan that includes market research, competitors, target customer and strategy.Define an operational plan that details production, legalities and employees.
List your management team and its role and responsibility. Determine start-up expenses that will affect your business and operations.Develop a financial plan, including 12-month profit and loss projections, cash-flow projections, projected balance sheet and break-even calculations.
“It is important to have a business plan, but I do not believe in spending a lot of time on it. You will be learning as you go along. Your business plan will be your skeleton; don’t be sucked into the details too much though. Get your business going,” she advises.
Cash is queen
The heartbeat of any successful business is cash flow. And, if you don’t have any financial background, Nombakuse suggests that you empower yourself with financial literacy. “Do not just hand over your balance sheet and income statement to an expert.
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Know your figures, too; be interested and ask questions. Know your cash flow and the expenses you pay monthly. Remember that unpaid invoices will kill your business. In the meantime, pay your accountant and learn from them, listen and take advice,” she adds.
Getting your first client amid COVID-19
As much as you need to know your cash flow, you also need to bring in clients in order to make money. While the coronavirus pandemic has negatively impacted many businesses locally and abroad, you can still be your own boss in 2020.
Shozi advises that you join available networks where your potential clients might hang out and use social and local media, such as local newspapers and radio stations, to market your business.
Nombakuse adds, “See COVID-19 as a challenge and an opportunity to teach you something. Transform yourself, be patient and remember that you’re dealing with a global problem. You need to be understanding of the situation; your potential customers will also cut their budget and try to save money."
"Also, find ways on how you can get your product to your customers through the use of digital tools such as online selling – be innovative and creative. Remember that there is never a best time to start a business; it depends on the one you want to start. Businesses that are doing well now are those that have already incorporated technology, such as digital strategies. Even if you are not going to trade right away, you can go ahead and start building your business model during lockdown. Things will not be like this forever. Prepare for post COVID -19.”