Oftentimes, the lure of owning a business is more about mistaken notions of fast cash and being your own boss, than about hard work and decision-making. Too many failed business owners believe that the biggest advantage of working for themselves is having no boss. Sure it sounds good, but often a would-be entrepreneur isn’t prepared for the rigors of running a business. It takes vision, capital, courage, commitment, and determination to run a business and without those things, many entrepreneurial hopefuls are quickly shut out of the market.

Avoid the misconceptions

The best way to decide if being an entrepreneur is right for you is to take a close and honest look at your motives, and compare them to those of former business owners.  Here are some common misconceptions to avoid:

1. I don’t need a business plan. A new business owner may think that having a solid business plan written down is a waste of time. Hee may fool himself  into thinking that a “mental plan” is enough to get the business started., and this can be a regrettable mistake. Writing a plan down lends mental clarity. It also can show a business owner any missing parts of his plan. For example, a business plan will hone in on exactly how much capital is needed to start up operations, how much is presently exists, and viable options for coming up with the rest. A “mental plan” is much less likely to have all details in place.
2. I have a unique vision. A good idea is not the same thing as a viable business. A potential business owner’s love for a new product doesn’t mean there is a market for it. The simple fact that one person (the would-be business owner) is willing to pay $49.99 for a product, doesn’t mean that other people are. Millions of people have had a great idea but only a few have been able to build a business out a of it.
3. The competition is no problem. Some potential business owners are so focused on the idea of making fast cash that they forget to do their homework. Venture capitalists hear this all the time: “This widget is going to generate money because no one else makes it!” The reality is that if no one else makes it, one of two things is going on: Either the business owner hasn’t really searched hard enough or the product isn’t in demand.
4. I want the satisfaction of owning a business. Ego is another enemy of business ownership. Some owners insist on running the show but have no real idea of how to do it. Successful entrepreneurs stick to what’s best for the business and are willing to defer to more knowledgeable managers when necessary. For them, ego isn’t a part of the equation when dollars are at stake.

Think twice about business ownership

Fast cash and running the show are both nice, but not necessarily the best motivations for starting a business. Much more is involved and potential business owners should sit down and consider their true goals before starting out. Unless you’re prepared to handle the full responsibilities of an entrepreneur, it’s best to keep your day job and leave business ownership to someone else!

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Find the entrepreneur in you

I have entrepreneurial flair, passion and I can prepare a business plan. I have always had a dream about running my own business my way and making it my success; now’s my chance!

It may be time to follow your dream

They say you should follow your dream and entrepreneurial passion. You are more likely to succeed when you’re doing something you love for a living and, besides, small businesses have shown they stand a good chance of flourishing in tough economic times. If you’re an entrepreneur at heart, this year may be the ideal time to launch that business you have been dreaming of. The tough economic times are in good supply.

How to start

If you a true entrepreneur, there will come a time when you will know that you have to take the plunge and quit your day job. If you don’t grab this opportunity, you will probably never do it.

A business plan

Create a business plan

Look for and identify a gap in the market where you can transform your business idea into a workable plan. A well-presented and researched business plan will convince a bank, the small business administration or prospective financier that you have thought your idea through from A to Z and that you have taken eventualities into consideration. Hone your business plan, work out cash projections and know the bottom line down to the last cent. A sensitivity analysis should be part of the business plan so that interest rate fluctuations are catered for.

You must do your homework

You must do a fair amount of research, not only on the finances of what will be needed to run the business for 6 months, but also market research to ensure viability of your service or product.

Learn the basics of business. There are many stories about people who make it in business without having had any training. You will feel more confident and those you approach for financing will probably be more accommodating when they see that you have invested in gaining some necessary entrepreneurial skills. These skills will also protect your personal business interests. For example, in order to understand your financial position you must be able to read and understand the balance sheet.

Take a course

There are many courses which you can take and which are designed to teach the basics of running your own business and how to communicate effectively with customers and suppliers. Such courses have modules on business accounting, practical bookkeeping, advertising, general office practice, spreadsheets and word processing, among others.

There are other courses which include modules such as how to apply innovative thinking to the development of a small business, researching the viability of new venture ideas, management of finances of a new venture, ethical conduct in a business environment and the productive management of time.

Do not…

Open up the shop without any idea of what will happen. You may have fun for a few months and think that you are doing well, but when it comes to analyzing the business finances, you may find you are slowly losing everything.

I recommend taking the first steps while you are still employed in your job. Enroll in a couple of course to make sure you are well-prepared when you open your own business.