April 25, 2012
Is 2012 your year to become an entrepreneur?
Tired of the 9-to-5 slog? Want to be your own boss and pursue only what you are most passionate about?
This could be your year.
2012 will be the year of the entrepreneur, predicted Time magazine. With technology offering low-overhead business models and access to innovative funding options like crowdfunding, it might be easier than ever to launch your own small business, product or service.
Are you ready to quit your current gig, cash out what's left of your life savings or tap into the retirement account and pursue that lifelong dream?
Entrepreneurship might indeed be the answer for you, but I would think and plan carefully before leaping headfirst. I speak from experience.
In 2007, I was caught in the swirl of the drowning economy: Household income was no longer enough to cover a mounting mortgage and childcare for two children, so I decided to launch an e-commerce business selling high-end, earth-friendly baby diapers. I figured that the low overhead of an online retail store, a social-media-based marketing plan and the initially uncompensated workforce consisting of just my husband and myself would allow us to start up on a shoestring and get in the black quickly.
Some of our initial estimates panned out. Others were way off the mark.
The business model was sound -- the demand for a niche market was there, and parents were searching online for the products we wanted to offer.
But we vastly underestimated the cost of building a highly functional e-commerce site that allowed for the easy navigation and large variety of products we wanted to offer. We tried to cheap out and ended up going through two website developers, including one who stole our money, before finding a team that could execute our vision.
It took more than a year, instead of our initial estimate of two months, to launch our full site.
My initial estimates for the cost of starting inventory were low, too. Some products can be drop-shipped, but Internet shoppers are savvy and generally want a fully stocked store with fast (and free) shipping.
I also never accounted for the nearly two years of late nights (my husband and I working until past midnight, five nights a week, while still managing our regular day jobs and family responsibilities). But this is what it realistically took to execute our vision.
Finally, although the online marketplace is popular with our demographic -- parents and parents-to-be -- it is also saturated with sellers. It turned out that the local demand for our products was where the money was. Luckily, the demand was there, but local shoppers would change our online-only model and require more investment in time, physical space, insurance and other costs.
If you think 2012 is your year to launch your entrepreneurial dream, I suggest that you:
Make a detailed business plan. There are courses and consultants that can help with this. Be open to the possibility that your research might require alterations to your business model. Be flexible.
Build in extra padding for start-up costs. Do not expect to rely on profit in the short term (do not expect any profit in the short term).
Seriously study your competition and the marketplace. Why will customers come to you? What are you offering that other businesses are not?
Create a full-fledged marketing plan. This must include a strong online presence.
Don't quit your day job. If you don't have one, consider getting one while you build your business. That way you won't be reliant on your new venture until it's truly ready to provide for you.
Finally, make sure you have the stamina. Entrepreneurs work long hours and put everything they have into making their venture a success. Chances are a regular day job will be less intensive, less demanding of your time and less stressful, at least at first. But your own venture can be more flexible and personally fulfilling.
The choice is yours.
Karen Burns is the author of The Amazing Adventures of Working Girl, a career guide based on her 59 jobs over 40 years in 22 cities.
Kristen Fife is a senior recruiter, career mentor, blogger and resume consultant based in the Seattle area.
Lisa Quast is a certified career coach, mentor, business consultant, former corporate executive and author based in the Seattle area.
Randy Woods writes about job-search tools, networking techniques and other tips to help you land your dream job.
Matt Youngquist is the president of Career Horizons, a career counseling firm.
Natalie Singer is a Seattle writer, editor and small-business owner.
Michelle Goodman is the author of "My So-Called Freelance Life" and "The Anti 9-to-5 Guide."
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