Deborah K. Swanson
Last month we looked at the characteristics of a successful entrepreneur as the Small Business Administration sees them:
- Guts - that entrepreneurial instinct, which is usually nothing more than an overwhelming desire to own your own business.
- Brains - Have solid knowledge about the business you’re about to start before you start it!
- Capital - Have enough cash on hand to pay your bills for at least a year. You can start on a shoestring and forego frivolities, but do have enough to cover your needs.
- So let’s look at those a little deeper so you can decide what business to start.
Drive thy business or it will drive thee.
- Benjamin Franklin
Ken Mann, chair of the Los Angeles Chapter of SCORE (Counselors to Small Business), says the best thing to “Stick with what you know.” Know the business you’re going to start, whether you’ve already worked in that field or need to do so for a while before starting the business. And if you’re still working in a job you’ve had for years, moonlight until you get the experience you need.
Mann, however, did something a little different. Having worked in the foodservice business for 20 years, he switched to the field of communications services. But there was a common thread in both businesses - sales.
He’s heard some rather off-the-wall ideas from the 6,000 would-be entrepreneurs that come through SCORE’s offices each year. One woman wanted to finance her ultimate dream business, which was a natural progression of her current job. But she wanted to do it by abandoning her current job completely to start two different businesses in which she had no experience at all. She thought these businesses would raise the money to finance her dream. That convoluted idea didn’t pass the SCORE feasibility sense and they gave her better guidance so she could create her dream.
But another SCORE counselor, Frank Schiller, says, “You do not need to have actual experience, but the business idea had to be of great interest in the past, or you’ve done a lot of reading and have possibly visited similar enterprises. If you have the financing, you can always get taught the basics and, with proper budgeting, survive the needed year or two of diminishing losses.”
How to Select Your Business
The SBA has much to say on this and I’ll loosely interpret here.
DON’T PANIC! Take your time. Wait or find the right business for you, don’t jump in without doing your homework. Or has Herodotus said about 1,500 years ago, “Haste in every business brings failures.”
SMALL BITES. Start with a small plate, or goal. You can always add more courses (services/products).
LOOK AHEAD. Don’t grab onto the latest fad, it will probably be over with by the time you get going.
Follow the advice of advertising legend David Ogilvy:
In the modern world of business, it is useless to be a creative original thinker unless you can also sell what you create.
Survival Tips
No matter what you do, here are some survival tips. But as with everything, there are those who did everything wrong and still survived. It will just make sleeping a little more difficult.
- Don’t dip into 401k funds. Keep your finances as stable as possible.
- Try your business part time, if possible.
- Have your spouse continue to work in his/her job until you know your business will survive.
Personal Experience
Personally, I’ve always had more than one “job.” I worked 14 years for one organization and still wrote on a freelance basis for many publications and clients that didn’t conflict with my day job. Yes, sometimes it was taxing and deadlines loomed large at times, but no regrets. That structure made my leaving that job much easier. I had a network established and transitioned easily to working primarily from home.
On a recent trip to a Jamaican estate, I heard the workers in the Walkerswood spice factory (still in a cottage until their luxurious new factory is complete), sing with joy every morning as they started to work. Don’t you want to feel that way when you go to work?
Next up: How to tackle that business plan!
If It Works For You…
Lindsey Coen-Fernandez took her lifelong passion and made it into her Tustin-based fitness business, Rough-Fit, in 2002.
“I’d been working at Intel, running the southwest region, and our division was sold off. I took the package to leave so I could do something I really had a passion for,” says Coen-Fernandez. “I put together a business plan, mapped out the first year and then the second.”
What made her do it? “In corporate industry I found people didn’t make themselves the priority - it was always work. But you only have one body, one self, no one else can help you with that but you.”
Fernandez was very active and had completed marathons. But she had an extra 40 pounds on her and braces on her knees because of it. “I looked like a lot of clients who come to me now. I can empathize with my clients. Most of us work out in unhealthy ways for a long time. Baby boomers don’t want to get old. They want to be the athlete they were 20 years ago — immediately. We state it will take three months to see change and take a progressive approach to minimize injury because in gyms, 90% of people drop out in six months. We have the reverse ratio. All of our 2004 clients signed up for 2005.”
With more than 100 clients, Coen-Fernandez has exceeded her initial expectations, when she thought 40 would be great. Now she’s looking at a growth plan and other areas of wellness. Part of Rough-Fit’s appeal is that most of the fitness work is done outside and the personal trainers really are personal - they know each client and their abilities/goals. And they laugh a lot.
“I believe if you have fun, you’ll be successful.” www.rough-fit.com 714-832-8590
Experience Counts More than 99 Cents
At a SCORE sponsored gathering where the rather eccentric Dave Gold, founder of the 99¢ Only Store chain, spoke of his early days running a store in Los Angeles’ Central Market, where he sold wine for 79¢ a bottle, and up to about $1.49. “The most popular items were always 99 cents. People didn’t want to buy the lowest or the highest price, they went right in the middle.” He and his wife then talked about starting a 99 cent store, but he didn’t act on it for another 20 years, when he was 50, all the while gathering experience. With his legendary launch tactics of selling nine color TVs for 99 cents at every store opening, causing overnight campouts at the stores, he’s garnered major media coverage. His humorous ads, like the recent declaration that the 99¢ Only Store was “the official bridal registry for Charles and Camilla,” since they were getting married on the 99th day of the year, keep his customers laughing and loyal. The $1 store just doesn’t have the same marketing hook, does it? And now there are 219 stores in California, Nevada, Arizona and Texas. The store even owns the brand Rinso, once owned by Lever Brothers/Cheseborough Ponds, and now has the product packaged specifically for the 99¢ Only Stores. The company went public in 1996 and Gold says he’s never had to close a store for lack of business. With an average of 39 cents profit on his 99 cent items, and 2004 sales of $971 million, there are plenty of funds to go around. Gold has shared with his employees and managers millions in stock options, taking none for himself or his family.
Resources:
www.scorela.org
Score has chapters all over the country including Orange County, Ventura, San Diego
There are 75 counselors in the Glendale (Los Angeles) district, and you’ll be matched with a counselor with similar experience to your business. SCORE also offers numerous low-cost workshops on all aspects of running a business. Check their online calendar at www.scorela.org
The Small Business Administration www.sba.gov
The Women’s Business Center, a division of the SBA www.onlinewbc.gov
Books:
“Making a Living Without a Job, Winning Ways for Creating Work That You Love,” by Barbara J. Winter
“The Best Home Businesses for People 50+,” by Paul and Sarah Edwards
There are some fun and practical jobs in this guide - appealing to all personalities
“It’s only too late If You Don’t Start Now, How to Create Your Second Life at Any Age,” by Barbara Sher