As with many things that are worth doing, starting a trade business can be difficult. It takes sacrifice, a whole lot of organisation, financial stability, strategic thinking, self-confidence, unwavering determination, and plenty of planning.
When tradies commit to going out on their own and starting their own trade small business they will likely have many questions that need urgent answers. The most pressing question will likely be, “am I ready to strike out on my own and run my own small business”.
As a newly minted small business owner it is critical to your success that you feel confident in your decision to launch your own business and in time make it a success. So, how can you know for sure if you’re ready to start your own small business?
Here are five important questions to ask yourself and mull over if you are on the fence about whether starting your own trade business is the right decision for you right now
Am I ready to be my own boss?
Being a small business owner means more than just calling the shots. It also means that you need to be able highly self-motivated. Early mornings, late nights, and sacrifices will likely be required to get your business to where you want it to be. You need to be willing to put in long hours, especially in the early days.
You also need to consider the impact that the extra workload and possible financial stress might have on the people around you. Owning a business can put strain on your relationships and mean that you have less time to share with friends and family. As such, it’s important that you are willing to make these compromises in order to succeed with your new business.
Have I created a thorough business plan?
Having a well thought out business plan before launching your trade business can be critical for increasing your chances of success. Ask yourself if you fully understand what you want to achieve with your business. What problems will it solve for you? How will you differentiate your trade business from the competition? How will you measure success? Where do you envisage your small business being in the next five years time?
You business plan should answer these important questions. If you can’t answer them right now, you may not be quite ready to start your business. Without a concrete strategic plan for where you want to take your new trade small business, it may prove difficult to order your priorities and focus on what needs to be done to achieve long-term growth and business success.
When it comes to growth, you will also benefit from deciding how much and how quickly you want your business to grow. The more your business grows, the more moving parts there will be for you to focus on. These can include:
- hiring and managing staff;
- processing payroll;
- company vehicles;
- business insurance; and
- multi-tasking on multiple jobs at the same time.
If you have a clear vision in mind, do you have a plan to achieve it? If not, that’s something that needs to be created before you launch. Every aspect of your business should be planned out well in advance of its creation. This way, you’ll be able to foresee certain obstacles and take a more organised approach to starting, growing, and maintaining a successful business.
Do I have a brand?
All businesses can benefit from having a memorable brand and strong branding. Is your brand ready to be presented to the public and potential customers? Do you have all your marketing assets in place?
This may include a compelling business name, company logo, company website, phone number and company email address, Google Business Profile, job management system, sign-written vehicles, staff uniforms, social media accounts. You will greatly benefit from have these essential business tools up and running prior to launching your small business.
Do I have the finances to launch your own business?
Starting a trade business generally doesn’t come cheaply. From tools, vehicle expenses, licence fees, rent, wages, business insurance (including Public Liability insurance and Tool and Portable Equipment Insurance), there can be a lot of up-front expenses and required costs that you should be aware of before you commit to starting a business.
It’s a good idea to create a list of expenses (ranked in order of priority) with estimated costs. This will give you an approximate indication of how much capital you may need to get your new trade business off the ground, while also helping to prioritise which areas need investment and which can wait.
If you crunch the numbers and find that you don’t have the funds to front the start-up costs of your business, don’t be discouraged. Instead, explore finance options such as a business loan from your bank, or seeking out potential investors to help get you up and running.
Am I ready to work?
A successful business is an efficient one. As your business grows, so will the amount of admin and office work that goes on behind the scenes. So, have you got a plan in place to manage the workload when your business takes off? Starting off on the right foot with the right systems and people in place may be the difference between a wobbly start and a successful launch.
BizCover helps tradie small business owners throughout New Zealand to reduce the risks to their business via business insurance*, including Public Liability insurance, and small business insurance. Visit bizcover.co.nz and get business insurance for your trade business without drama and get on with your day.
*This information is general only and does not take into account your objectives, financial situation or needs. It should not be relied upon as advice. As with any insurance, cover will be subject to the terms, conditions and exclusions contained in the policy wording. © 2022 BizCover Pty Limited. BizCover Limited is owned by BizCover Pty Ltd (ABN 68 127 707 975).