Learn tips on how to transition from Employee to Entrepreneur / Business Owner.

What are your life goals?. For many of you, this goal may be to be able to become your own boss… Become an entrepreneur… Start your own business.

This is not an easy decision to make, specially when you currently have a job with a good salary and benefits. But it might be definitely worth it! Not only you can achieve better work-life balance once you start controlling your time (and potentially even work from home, as there many good home-based business options out there), but you can potentially generate a much higher income in the long run!

Now… it is important to plan for a smooth transition from corporate life to entrepreneurship, and here are some tips that can help:

business-plan

1) Build a Business Plan

Before you start any investment, it is crucial to build a plan. This plan should include an analysis of the industry (market size, growth, trends, etc), the competition, as well as an overview of your company’s mission, vision, strategic goals and marketing mix (product or service to be offered, promotion plan, placement plan and pricing).

In addition it should include a financial projection (P&L projection, cashflow projection). With that you can have an estimate of how long it might take for the business to ramp up and plan to potentially continue working at your current job until time is right to make a full transition.

There are many business plan templates available for free to download, that can help understand all aspects that need to be considered (click here for some examples).

power-team

2) Build a Power Team

As you become a business owner, it is important to tag along with advisers with expertise in different areas to support you through providing guidance on different aspects of the business. For example, it is recommend you have a CPA who can help you with financial analysis, as well as tips on taxes.

An attorney may also be helpful when it comes to advice on type of legal institution to open, liability protection, and others.

Finally, in the case of a business that relies on a team of employees and a general manager, you should ensure you are building a strong team you can rely on, even in times you won’t be present.

part-time

3) Plan to work part-time in the business at first

If possible, it would be great to keep your current job while ramping up the business, until it is at a stage in which you feel comfortable transitioning to full time business owner. If you are a couple making the investment, consider one of you working full time on the new business, while the other works part time, keeping the job.

working-capital

4) Allocate a working capital budget for the first months

You will want to make sure you have enough working capital available to spend during the business ramp-up phase.

Based on your financial plan and knowing when you would expect to start breaking-even as well as being profitable, you can plan the amount of capital you will need to have available during the ramp-up phase.

milestones

5) Set goals and milestones

It is important, when building your plan, to set goals and milestones (KPIs – key performance indicators), so you can monitor your performance based on them over time. This will help you analyse if your business is performing according to plan, or if you need to make any strategic adjustments.

franchise versus independent

6) Consider investing in a franchise rather than in an independent business

If this is the very first time you are opening a business, a franchise can be a great way to be in business for yourself, but not by yourself! Franchise companies provide training, support and assistance with defining strategic locations to open the business as well as marketing and promotion. In addition, franchises are businesses with proven models that have worked well in other locations, so the chances of success tend to be higher. In addition, the mentoring and support you can get from a franchisor will prepare you for a great future as an entrepreneur. Click here to read more about pros and cons of investing in a franchise.

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