Starting a Business During Uncertain Economic Times
Every business owner loves to operate in an environment where the economy is thriving. When there is strong economic growth happening, consumers have more money in their pockets, and they have more disposable income to spend. Even when a business lacks a great product or a flawless marketing strategy, they can still do well during a strong economy.
Should you get into a new business in today’s economy?
How will you deal with social distancing, mask requirements, and other compliance issues that have been brought on by the pandemic?
And what happens if a second wave hits and the country goes into lockdown again?
These are all valid questions. Any business you go into right now will present challenges that would have been unthinkable earlier this year. Yes, we are in the midst of a worldwide pandemic with no definitive timeframe for going back to the way things were before.
In spite of all this, aspiring entrepreneurs should find a business for themselves. If you have an entrepreneurial mindset, you know that owning a business is always a gamble, no matter what market conditions you may be in. If you do not understand this fact, then perhaps you are not meant to be in business in the first place.
Another thing to keep in mind is that whenever there is any type of crisis or market disruption, this always opens up new opportunities to serve others and earn a living by doing so. A crisis of the magnitude of COVID-19 no doubt provides numerous such opportunities to begin your entrepreneurial journey.
Factors to Consider when Going into Business: As is always the case, simply becoming a business owner does not guarantee success. You need to evaluate what type of business to get into and how you are going to go about it. Toward that end, here are some important questions to consider:
What Markets are Likely to Grow: Think about the types of businesses that are going to be “essential” in the years to come. Several may come to mind:
- Digital/E-Commerce Businesses
- Delivery Services
- Contracting and Home Services
- Virtual Offices
- Mailing/Shipping Services
- Cleaning Services
- Senior Care Services
- Auto Repair Services
- Accounting/Bookkeeping Services
What are Your Passions and Skillsets: Now, examine the above-listed businesses and others you have come up with that are likely to be in demand and find out which ones are right for you? Be brutally honest with yourself with regards to what you are truly passionate about, and what tasks you are particularly good at.
A lot of people make the mistake of thinking that just because they are entering an in-demand industry, they will succeed no matter what. This is a common myth that leads to countless business failures. The fact is that no matter what business you are in, you need to be willing to put your heart and soul into it, and you need to have the skills needed to make it work.
How Much Time do you Have to Invest in your New Business: Another thing that you need to evaluate is how much time you have to devote to a business. Some businesses require your full-time attention, while others are more passive and can be managed part-time. Take a look at how much time you need to devote to another job (if you have one), your family, and other obligations, and decide if you have the time available for the business that you want to be in.
How Much Money can you Afford to Invest in Your Business: Getting into a business takes money. Some businesses only require a couple hundred dollars to get started, while others require thousands or tens of thousands of dollars or more. What does your financial situation look like? Do you have the money to invest in the business you want to be in? And if you do not, can you borrow that money from the bank, a family member, or an alternative source?
Should you Start from Scratch or Purchase an Existing Business: There are two general paths you can follow when you become an entrepreneur. You can start a business from scratch, or you can buy one that is already established. Starting from scratch typically costs significantly less money, but it will require a lot more of your time and effort in the beginning, and it will take you a lot longer before you reach the point of profitability.
Again, you will need to examine your personal situation. Are you looking for a business that can instantly provide you a good living? Or can you afford to wait for the rewards while you work another job? Can you come up with the money to purchase or finance an existing business? Or do you have limited financial resources that put that option out of reach?
If you do have the financial capability to buy a business, there are a lot of advantages to going this route. Perhaps the biggest one is that you can bypass the thousands of headaches that occur during the startup months and profit from the hard work the previous owner put in. In addition, if you have done your homework and determine that you are a good fit to own and operate that particular business, then there may be potential for significant growth in the not-too-distant future.
Looking to Purchase an Existing Business: If you are looking for a business to buy based on your criteria, the best place to start is to speak with a local business broker. Business brokers have access to a wide range of listings and other available resources, and they can work hand-in-hand with you to find the business that best fits your unique personality, skillset, and budget.