iamshack Posted July 1, 2014 Share Posted July 1, 2014 My wife and I are considering starting a new business in the line of service she currently works in at our company. She is frustrated with some of the politics in her department, has a mastery of their business, and thinks she can do better on her own. I also would like to look for ways to increase our earning power and diversify our careers/income sources a bit. The time is not right now, but it could be time in 6-12 months. Has anyone started their own company/business? Words of wisdom or advice? Quote Link to comment Share on other sites More sharing options...
Jake Posted July 1, 2014 Share Posted July 1, 2014 Make sure your business fills a need. If you're the type of business that serves a geographic area (like a storefront), this is even more important. Talk to your wife about contingencies before you launch. How much money are you willing to lose, how much time are you going to allow to get things off the ground, what kinds of personal/social sacrifices are you and aren't you willing to make. On a related note, know when to pull the plug. If it isn't going to work out, then it isn't going to work out. No sunk cost fallacies. I'm of the belief that the small things matter. Every little thing about your company should look excellent to outsiders. Get a good looking logo, a well-designed website (hire a professional if needed and don't accept a mediocre job from them), and ensure all your materials look great and are devoid of things like grammar and spelling errors. Nobody will tell you that these things put them off because it will happen subconsciously. Make all of their interactions with your business give them the expectation that you're great - then, when they actually approach you for whatever service you offer, they'll be convincing themselves that what you say confirms their initial impression that you guys are good. Be personal. Quote Link to comment Share on other sites More sharing options...
iamshack Posted July 1, 2014 Author Share Posted July 1, 2014 QUOTE (Jake @ Jul 1, 2014 -> 10:16 AM) Make sure your business fills a need. If you're the type of business that serves a geographic area (like a storefront), this is even more important. Talk to your wife about contingencies before you launch. How much money are you willing to lose, how much time are you going to allow to get things off the ground, what kinds of personal/social sacrifices are you and aren't you willing to make. On a related note, know when to pull the plug. If it isn't going to work out, then it isn't going to work out. No sunk cost fallacies. I'm of the belief that the small things matter. Every little thing about your company should look excellent to outsiders. Get a good looking logo, a well-designed website (hire a professional if needed and don't accept a mediocre job from them), and ensure all your materials look great and are devoid of things like grammar and spelling errors. Nobody will tell you that these things put them off because it will happen subconsciously. Make all of their interactions with your business give them the expectation that you're great - then, when they actually approach you for whatever service you offer, they'll be convincing themselves that what you say confirms their initial impression that you guys are good. Be personal. Great advice, Jake...thanks! The great thing is we have access to some amazing expertise and talent as a result of our contacts in our current company. And given the fact that our company was recently acquired, we have some folks that are considering walking. There is some incredible potential here...we just have to have the stones to do it and the brains to pull it off. Quote Link to comment Share on other sites More sharing options...
witesoxfan Posted July 2, 2014 Share Posted July 2, 2014 Having taken enough entrepreneurial classes and been involved with speaking to people about their companies, the thing I would suggest beyond Jake's advice is to consider absolutely everything that could go wrong and come up with potential solutions - ideal solution, plans b, c, d-thru-zzz. There is absolutely no such thing as too much preparation. Quote Link to comment Share on other sites More sharing options...
LittleHurt05 Posted July 2, 2014 Share Posted July 2, 2014 While she is still working the other job, just try to make and keep as many solid business relationships as possible right now, you never know when those people could come in handy in the future. I don't know what kind of customer base her business would draw, but having potential customers lined up right when you start is huge, just get some money and stability flowing in right away. Quote Link to comment Share on other sites More sharing options...
iamshack Posted July 2, 2014 Author Share Posted July 2, 2014 QUOTE (LittleHurt05 @ Jul 1, 2014 -> 08:33 PM) While she is still working the other job, just try to make and keep as many solid business relationships as possible right now, you never know when those people could come in handy in the future. I don't know what kind of customer base her business would draw, but having potential customers lined up right when you start is huge, just get some money and stability flowing in right away. Yeah, she would most likely leave after we felt there was an anchor customer or two that could be had. Quote Link to comment Share on other sites More sharing options...
StrangeSox Posted July 2, 2014 Share Posted July 2, 2014 no non-competes to worry about? Quote Link to comment Share on other sites More sharing options...
iamshack Posted July 2, 2014 Author Share Posted July 2, 2014 QUOTE (StrangeSox @ Jul 2, 2014 -> 09:14 AM) no non-competes to worry about? Not for her; most of us do not have contracts here. Although one of the other potential partners would have a 2-year non-compete in a particular area of the general field. We'll have to figure out a way around that...most likely going to have her look into some slightly different areas. Quote Link to comment Share on other sites More sharing options...
EvilMonkey Posted July 3, 2014 Share Posted July 3, 2014 If you will need to sign a lease for space or equipment, get incorporated and stay away from personal guarantees. Keep the terms as short as possible at first in case things don't work out. And don't buy equipment/space and hope the business will come to use it. Deal with over-crowding or longer hours until the business is built up enough to cover it. Not sure what kind of business it is, but doing printing for over 22 years, I have seen way to many owners just buy things that they don't need. Always upgrading to the newest printer, bigger monitor, ink jet printer because they think adding signs will help, and so on. But even when you HAVE the business to warrant purchase, be careful, it can leave just as fast. I signed a 3 year lease on a lightning fast color copier once to cover all the work I got from a new customer. For the previous 6 months I had been working super long hours to cover their job on our slower machine. The new one would save me 20 hours a month! Then 2 months later they went belly up and I was stuck with a lease for a machine that I no longer had production for. I increased the sales effort, but no where near enough to cover that beast came in. Partnerships are harder. You will need to get a business lawyer and take their advice on how to set it up regarding responsibilities and liabilities. Good luck with that. it is scary seeing your name on the signature line instead of the PAY TO line, and watching the check book balance go down. Jake also mentioned 2 very good things. Be willing to pull the plug if it doesn't work. Somewhere, there needs to be a line as to how much money you invest in it. And typos in your printed materials really suck. So when your printers ask you to proof read what they set for you, actually proof read it. Quote Link to comment Share on other sites More sharing options...
Soxbadger Posted July 3, 2014 Share Posted July 3, 2014 Alpha has some pretty solid advice. If you have any specific questions I can probably answer them. Quote Link to comment Share on other sites More sharing options...
StrangeSox Posted July 3, 2014 Share Posted July 3, 2014 (edited) QUOTE (Soxbadger @ Jul 3, 2014 -> 12:07 AM) Alpha has some pretty solid advice. If you have any specific questions I can probably answer them. I can as well, but for a $50k consulting fee. edit: I have some business plan spreadsheets and documents from a class I took a couple of years ago. I could send those to you if you wanted. Drop me a PM if you do. Edited July 3, 2014 by StrangeSox Quote Link to comment Share on other sites More sharing options...
Jenksismyhero Posted July 3, 2014 Share Posted July 3, 2014 Be prepared for the government and future employees to run the company for you. Their opinions matter more than yours. I'm told that's the way businesses should work. Quote Link to comment Share on other sites More sharing options...
iamshack Posted July 3, 2014 Author Share Posted July 3, 2014 Thanks guys...I appreciate the willingness to help! Maybe the company will do well and you guys can all work the Chicago office Quote Link to comment Share on other sites More sharing options...
EvilMonkey Posted July 3, 2014 Share Posted July 3, 2014 QUOTE (Jenksismyb**** @ Jul 3, 2014 -> 08:21 AM) Be prepared for the government and future employees to run the company for you. Their opinions matter more than yours. I'm told that's the way businesses should work. I wasn't going to go there, but you do need to be careful with your employees. Document EVERYTHING. Keep a hard copy file and an electronic file that is backed up off site. Never meet behind closed doors, especially if they are the opposite sex, unless you have 2 people on your side there. And even then, don't do it if you can help it. Don't laugh of complaints no matter how trivial. Again, document them, and what you did or didn't do, and why. If warranted, have the employee sign off on what you documented. make sure to document good things as well such as promotions or raises too. It's CYA all the way and can only help you. Unless you document yourself grabbing the intern's ass and getting a BJ. Then you are on your own. Quote Link to comment Share on other sites More sharing options...
LDF Posted July 31, 2014 Share Posted July 31, 2014 (edited) major question, is your company need a store front location or can you start from the house. overhead, do a little as possible, to save your start up money. first start with knowing the tax law and see how to can work all expenses to be deducted. mode of transportation. know the tax law. advertising, be prepare, 20-30% will go for advertising. salary and employees and of course you are also a employee. future expansion, you may need to open 2 LLC, 1 to be the parent company and the other as the sub. this will help in banking, contracts, salary and will put a buffer between you and any major problems that may develop. like this you can closed the company without affecting your family finance. Protection. know when to start with ref to seasonal time. like will xmas be better than spring, ex-if you are in the pool business, you will not want to start in xmas but right after easter. so timing is the better word. do you need a sale rep ...... plan for that. think again how to save your start up money, furniture, utilities, rent, ins. again some owners keep forgetting, you constantly need to rethink on your start up money budget. to setup the quickbooks acct and continue to learn. if you can swing a loan, work from the loan and save your start up as an emergency fund. try not to spend for ofc equipment and see if you can rent furniture, machines. then this will be an expense of doing business with the lose of age. backup everything in 3 copies, 1 for your acct, 1 for your lawyer and keep one in the safety deposit box at the bank >>> Edited August 1, 2014 by LDF Quote Link to comment Share on other sites More sharing options...
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