Guest post by Thom Stimpel, Proactive Business Improvements LLC
COVID is likely to create a surge in small business start-up attempts and for some, these efforts will stem from misguided decisions. A number of glaring statistics illuminate why a start-up at this time may be risky and we’ll discuss the steps you can take to mitigate the risk.
On the heels of 2020, with massive job losses and thousands of individuals and families in financial distress, there is likely to be a surge in the formation of new businesses. Why? Because many are not finding employment opportunities and believe that their best path forward is to start their own business. For some, this could potentially be a huge mistake for two reasons. First, a successful entrepreneur must have a strong, valid reason for WHY they are starting a business – one that resonates with and motivates their customer base.
Starting a business because you cannot find anything else to do is a poor reason to launch a start-up because the WHY only serves your need to create income. That will not motivate a person to buy from you. Second, far too many people are not well equipped to be an entrepreneur. They lack the patience, creativity, knowledge, resources, experience and support needed to succeed – and most don’t realize what they’re missing!
Look at the statistics. On average, each year, of new businesses begun, 54% will fail within 2 years, and 97% will fail within 5 years. Why? For the reasons mentioned above. Contrary to popular belief, not everyone can be an entrepreneur. Your decision not to move forward may preserve your life savings, or your child’s college education fund, or perhaps even your marriage. Seriously! Even if you have already started a business, if it is less than 5 years old, or you are struggling in any way, you should quickly review your decision and determine what is needed to keep your business out of the weeds.
So, how do you determine if you might have the ability to start and sustain a successful business? The answer lies in honest answers to a set of questions. To succeed as an entrepreneur, you must wear many hats, some of which you have likely never worn.
The Path to Entrepreneurial Success
I have written a book entitled The Entrepreneurial Mindset. It takes a deep dive onto this topic and illustrates a way forward for those who are prepared to succeed. The book will guide you through questions that must be addressed on topics such as such Mission, Vision, Customer Base, Unique Business Identity, Unique Sales Process, Budgets and the creation of a simple but powerful Strategic Business Plan. But before you buy the book you might prefer to read a short white paper on the topic entitled Who Should Be An Entrepreneur? The white paper asks the initial questions that will lead you to understand whether you should attempt a start-up.
Thereafter, there are many other questions to be dealt with if you elect to move forward. Please note that the questions in the white paper are only useful if you are honest with yourself. To receive a complimentary copy of the white paper, send a brief note asking for it by name, to TJS.PBI@outlook.com.
I leave you with this very appropriate quote from the classic novel Robinson Crusoe. Take it to heart.
“Now I saw, though it was too late, the folly of beginning a work before counting the cost and before rightly judging of my own strength to go through with it, and it grieves me heartily!” –Daniel Defoe