Want to Be Your Own Boss? Here’s What You Need to Think About
How to follow your dream - Some critical thought and local resources can put you in the driver’s seat.
Do you ever dream of being your own boss, owning your own business? If you have but aren’t sure how to go about it, read on.
Many of us spend our careers working for employers, frequently wondering what it would it be like to determine our own financial destiny. In today’s world of corporate downsizing and companies shifting production and service roles overseas, finding a business that fits you may not only be a dream, it may be a necessity.
The process starts with a few simple questions. Do you know what type of business you want to buy or start? Knowing the answer is not critical at the start of your search, but it sure helps narrow the scope and reduce the time it takes to identify qualified businesses. If the world is your oyster, don’t despair, the process of finding your pearl can be gratifying if organized well and with a positive sense of purpose. Reputable business brokers and companies that specialize in matching buyers and businesses can significantly reduce your search time and increase the probability of success.
Have you vetted your desires with others that your decision will affect? A spouse engaged in your search can be a great ally…a distant spouse an unexpected foe. Location, work hours and lifestyle are variables that will impact on other people in your life. Be sure to spend enough time discussing your dream with them before taking the plunge.
Next. How much cash can you afford to put up for a business? This isn’t the same as how much cash or liquid securities you have in the bank. It means determining how much of your wealth you are prepared to invest in a new business venture. The answer depends on your financial position, risk profile and the type of business you ultimately choose.
The limits of your investment are not the limits to the size of the business you can afford. Often times, sellers are willing to “carry paper”, or make you a loan, for a period of time. In addition to showing a seller has confidence in the business being sold, this also creates a larger pool of buyers for the seller’s business. Furthermore, many businesses for sale have track records that allow them to qualify for bank loans or supplier financing. Before using too much debt to finance a business be sure to understand the risks if payments must be delayed or cannot be made.
You have now determined the type of business that best fits your situation and how much you can afford to pay. Now, where can you go to find your business? Many businesses change hands between family and friends. But don’t get discouraged yet – for example, the City of Vancouver has 9000 licensed businesses. Nearly 1200 of these licenses have been issued in the past year. Gina Bacon, Communication/Public Affairs Coordinator for the Greater Vancouver Chamber of Commerce, reports the GVCC’s membership at 1400 with 45-50 new members joining monthly. Of the new members, she estimates 50% are new businesses to the area or startups. As you can see, there are ample businesses opportunities in the area for those interested in buying or starting a business. Finding the right one for you will be the challenge.
Many businesses for sale are listed in the local newspaper. Web sites like bizbuysell.com and bizforsell.com can be a good source for small and mid sized companies on the market. Local business and real estate brokers, lawyers and accountants specializing in business transactions are also excellent sources for businesses on the market or better yet, soon to be on the market. Local business organizations, like the Chamber of Commerce for instance, frequently have an informal network of owners preparing to sell their businesses.
Bill Roller is the president and chief investment officer of BR Capital, Inc. He started his Vancouver based investment advisory business in November of 2003. In March of 2004, he started a second company: BR Capital Real Estate Finance, a mortgage brokerage. After working for a national brokerage firm for nine years, his dream was to run his own business. His goal is to create a large and profitable diversified, financial services firm. Bill was able to quickly answer the first two critical questions. His experience and knowledge of the financial markets made financial services an easy choice. A family that supported his dream increased his enthusiasm and made the discussion of the second critical question a piece of cake.
Bill had both enough of a nest egg saved up, and a large enough client base willing to follow him to allow him the time to focus full time on launching his two companies without creating a serious financial strain. He also chose an industry where his energy and experience are more valuable than investment dollars. Bill looked at a number of companies to buy but found that none were a good fit for his specific background. He concluded that he could best serve his target customer base by building his business from the ground up with some of his existing clients.
Answer a few simple questions and follow your dream.
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