If you are sick and tired of working long hours for little pay you may be ready to become the owner of your own business. Many people are finding that owning their own business is the only way to truly declare their independence and survive these troubled economic times.
Why are people finding this so attractive? Let us give you some ideas how having a business of your own benefits you.
1. Independence – As you know, you will have no employer directing your every move. Instead you will have the autonomy to make your own decisions and be in charge of your own success. However, there is a trade off. You may no longer have a single boss, you now will have many customers each of which is your “new” boss.
2. Benefits solely for you – All profits of the business are yours. With the exception of Uncle Sam and your overhead, whatever is left is yours alone.
3. Manageable work time – You will no longer need to punch a time clock or be accountable to anyone but your customers. You control your time.
4. Develop creativity – Here you get a chance to be innovative and creative. Put your talents to good use.
Who do we consider self-employed?
A self-employed person is someone who works solely for himself instead of having an employer, gaining income from a business or trade operated solely by yourself. You are considered to be self-employed if you:
– Pursue a trade or business as an independent contractor or sole proprietor.
– A member of a partnership pursuing a trade or business.
Starting your own business requires careful planning and effort. Planning is the major factor for a business to be successful. It may be tedious but the rewards are remarkable. It also entails thorough examination and research. The following are some points included in the planning process:
• Type of business – decide on what business you would like to venture into. You may want to include the benefits and detriments involved in this venture. Determine what products and/or services you will be offering to your future customers.
• Marketing – you also want to consider how you will promote the business. Determine what market you wish to target
Operating your own business can be difficult and there are many factors that need to be considered before you tackle this new career path.
Here are some things that you might want to take in to account…
Every business needs capital to operate. Many businesses start with a small investment. Some will thrive and be able to reinvest their cash flow. However, many start up businesses fail because they began with insufficient funding.
You need to secure a federal tax identification number if you incorporate or hire employees in order for you to operate. If you operate as a sole proprietor your social security number will suffice. You are obliged to pay taxes as you earn or receive income during the year.
Before any business can operate, you must know who your target market will be. Market research is one of the basic steps when operating a business of your own. It entails systematic gathering, documenting and analyzing information and data about potential customers and even competitors.
With this, you are able to determine who will be receiving or purchasing the product and service you will be offering. Finding customers can be really challenging, and a good marketing research plan will definitely help in doing so.
There is an enormous risk in starting a business for yourself and many do not succeed. Before you enter into this new venture make sure that you have thoroughly studied the pros and cons of having a business of your own. With proper planning up front, eventually all your hard work will pay off!
Choosing the Business Model
First of all what do we mean when we say business model?
A business model is a representation of how the company will make money. It is a condensed description of how an organization or company conducts business and how they generate income.
Some pointers when selecting a business model:
– Read and examine models that other successful individuals have used when offering related product and services. Innovation is a good thing however, duplicating a proven business model insures success.
– It must be clear and comprehensible. The simpler the plan is the clearer the revenue model will be.
– Something that is viable. Unless you have plenty of money to put at risk, do not reinvent the wheel. The best option is to duplicate a successful business.
The 9 building blocks of a basic business model would constitute the following:
1. Core capabilities – competency and capacity needed to accomplish the model.
2. Key partners – partner network participation in the model and other aspects of it.
3. Value configuration – underlying principle for a mutual beneficial relationship between an organization or company and its customers.
4. Value proposition – the products and services being offered to the market.
5. Target market – the objective of any business is to attract customers to buy the products and services offered in order to earn income. The target audience to which businesses rely for earnings and determination of different target segments.
6. Distribution channel – communication and distribution route to reach customers and offer them the value proposition which would include the marketing and distribution strategy.
7. Client/Customer relationship – the link that is established with the customers and the process of client relationship development.
8. Cost structure – the monetary requirement in deploying the business model.
9. Revenue streams – how the company makes money which constitutes the revenue model.
Once you have chosen your business model, the next step is to create your actual business plan. One of the best things about creating your business plan is that it may cause you to rethink aspects of your business model.
A change in the model chosen is just part of the process. Although the model picked is firm and tested, there is still a need to make minor changes. Change is good but too much change may pose a threat to your company. An example would be working with other contractors to get a better deal.
Picking out business models that other successful companies use has been proven to increase the chance for success. This has been the strategy used by most leading companies in different industries nationwide. Adopting a business model does not necessarily mean completely copying it.
Business model innovation
Innovation is closely related to the creation of business models. New and innovative models create a threat to replace other established trade models and traditional means of doing business. Some established organizations and companies look for new and unique business models that will compete with other companies thereby securing their position and success in the industry they are in.
Entrepreneurs and executives heighten their competency to manage continuous change and adapt to hasty changes in the business world. They do this by embracing and implementing new ideas into their business models.
A great business model does not ensure you that you are going to be successful. You still have to put effort into making it work. Hard work is certainly a great weapon for anyone’s success!
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