Many people dream of an income opportunity that provides substantial wealth but only demands a little of their time. In a later chapter I pursue the potential reality of doing this and show that there are ways to make a living by doing very little hands on work. However, there are barriers to this type of business and it would be sensless making a start in this vein. Some businesses lend themselves to automation, but getting to that stage needs a lot of experience of how the processes involved work and if this is your goal at stage one, it demonstrates a lack of commitment to succeed.

Do not get me wrong, a full time income from part time work is possible and I am in the process of attempting to establish this myself. I am hoping that the fruits of my current labours will provide me with a residual income in the future when I decide to wind down heading towards retirement! This is not for some time yet and if I reduced my hourly input now I would not earn enough in the future.

So if you are looking for a full time income to replace your current employment you need to establish two facts first in order that you can create a business plan to get you started.

  • How long are you prepared to wait, working at your current job, while your new business opportunity becomes a reality? How long are you prepared to develop your new business hand in hand with your existing employment? How much additional time to work are you prepared to commit each day or week?
  • How much money are you prepared to commit to your new business?

These two items are linked. The longer period you are prepared to spend a few hours each week working on setting up your new full time income opportunity, the less demand you will have on investment – primarily because you will continue to work at your day job for a living. Anything you earn from your new business will be a bonus – as in the case of a part time income.

You will undoubtably have to invest some money into your business, in addition to your time. Even if you are setting up your replacement business alongside your day job you will need to pay for things like computer and web hosting, print and postage and other sundry items. If you are trading you may need to invest in stock, or at least buy samples if you are acting as an agent.

Come up with a compromise

You will need to decide upon your time/money committment up front so that you can begin to establish a business plan for your new venture. I am going to suggest the following as a typical approach for the average business opportunity seeker:

“…I am prepared to invest an hour or two each day, perhaps more on some weekends, for the next one to two years while I continue to work at my current job. I will be happy to incur around $1000 up front costs from my savings and perhaps about $100 every month thererafter. As I begin to make money, this will be reinvested completely in the first year. As the revenue increases I will begin to save some in reserve for when I decide that it is possible to leave my full time employment…”

This does not sound like a lot of time and money, but for somebody who is starting from scratch without a clear plan, believe me it is quite some committment! However, it is achievable if you have a little savings you wish to invest, and the time comes from your existing free time.

So what can you do with a few $ and a few hours every month?

Rather than attempting to enthuse you with ways to make money (we will examine the merits of different business models in later chapters) I would first like to provide some more essential information and tools that you will need if you are every to start a business that will continue to grow and provide you with a full time income.

Business structure

When you set up in business you might want to research the best business structure for you. Starting a corporation immediately may give your business profile a boost, but will dump a whole lot of administrative duties on you when you have little business to show. Do not underestimate the time needed to fill out statutory returns and keep the authorities from your door. For the small business, wherever you are situated, there are dispensations that allow simplification of these obligations.

Get the tax bit right

You do not need to study to become an accountant – but you do need to be aware of your responsibilities. You cannot run a business without informing the revenue that you have done so. There are penalties for failing to declare. However, if you get the business structure right you should have little to worry about as your business takes off for at least a year – after which time employing the services of a competent small business accounts might assist you (at surprisingly little cost for the first year – the fees will go up as your earnings do) if you simply find the subject of finance too dry!

Get your family on side

You must have the support of your family. They may even provide a valuable free resource for you – helping with mailshots or carrying out market research. What you do not want is for any resistance to your plans. The worst thing to do is to start secretively. Some people are a little embarrassed when they start up, possibly because of the fear of failure and the resulting ridicule.

Use your existing resources

As with your family, try to get your friends on side. Some free help from your CPA friend would be worth a fortune compared to the dubious benefit of keeping your venture a secret in the hope of eventually surprising them with your new found wealth.

Re-visit your reasons for wanting to start in business

This suggestion is important. You may be unhappy with your current employment – the daily grind? Ask yourself what makes you unhappy with your work – it might not be the actual work itself, rather the fact that you are not your own boss. If this is the case, it would be much better to consider starting a consultancy or similar business to what you already do for a number of reasons:

  • You are already an expert in the field – no need to research new business opportunities
  • You may already be recognised in the market place – a simple announcement may bring you a lot of custom
  • Depending on your field, you will most likely be able to make a lot more working for yourself
  • There is less risk starting up as you already know some of the pitfalls

I can’t urge you strongly enough – unless there is a good reason not to, you would be best placed continuing your current career but working for yourself.

WARNING – If you do set up on your own take care not to contravene your current terms of employment. Poaching clients and business can be an offence.

The business plan

You might still be wondering why I am not discussing the merits of the different income opportunities that may be available? Be patient – first we are going to practice setting up a business plan using your current area of work to get the hang of what is probably the single most important part of starting a new business – the business plan.

The business plan is a mixture of words and numbers that shows that you have considered all apects of your proposed new business and have come to the conclusion that it works! The plan will form the backbone of a marketing plan going forward and by a template for measuring your degree of success. The plan will accompany your business as it grows, and be updated and corrected as you learn new  facts or forecast outcomes turn out to be different.

A business plan can be a lengthy document submited to a bank to obtain finance, printed in glossy papare and full of colour photographs. Your plan will be approximately four pages – each page covering a separate section of the business – in our example a brief summary of the contents would be:

  • Summary of the business – The plan is to set up a carpentry business serving the Smithfield county area. It will take advantage of the healthy home construction business in the area and the tendency for many occupants to build extensions (this example is based on an employee of one of the constructions firms). The business will involve smaller assignments taking one to two days to complete (and therefore can be done in a weekend) in the first one to two years, after which time it is envisaged that a second employee will be taken on to assist with larger one to two week jobs.
  • The Market – It is estimated that Smithfield county has 10,000 houses with planning for another 1,000 over the coming five years. The county is serviced by three local housebuilding firms with the occasional appearance of a national franchise on larger sites.
  • Finances – this will require the use of a simple spreadsheet to produce monthly and annual cash flows for the business. Working with spreadsheets is not difficult and most people are able to find their way round Excel these days. Using it to plan your likely costs and income is an essential tool in for business opportunity.
  • “S.W.O.T.” analysis – you must examine your business proposal and come up with at least three or four each of STRENGTHS, WEAKNESSES, OPPORTUNITIES and THREATS that your new business faces. Considering each of these areas will focus your mind on whether or not you think overall the business will succeed.

The marketing plan

Whereas the business plan is a formula for working through all apsects of a business idea, the marketing plan assumes the business is going ahead and is an attempt to answre the question – “how will I find customers for the business”.  It can form part of the business plan under the section describing the market – and, as can be seen in the next chapter, should be a “how to guide” to make money in the area that you have chosen.

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Filed under: A Free Business Start Up Guide

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