Okay, so you want to start a business more than anything but you also have real-life responsibilities like bills to pay? Not to worry. In this post, I will explain how you can make your dream a reality and how you can set up your own business while keeping your day job (for now). I know that you don’t want to hear that you have to keep your day job but unfortunately, the chances of your business being an overnight success are about one in a billion. If that. The best way to reduce the risk that comes with setting up your own business is to hold on to your day job and work on your business in your spare time at evenings and weekends. The beauty of doing it this way is that if your business fails you still have your day job to pay your bills and if your new business succeeds then making the transition to being your own boss will be less risky.
How to get started?
1) Don’t go round telling everyone at your day job about your plans. The last thing you want is for your employer to feel like you are losing focus on your day job and that you’re planning on leaving as soon as you can. Now don’t take this the wrong way, you don’t have to hide what you’re doing but only bring it up when you get asked about it. Also, an obvious add on to this would be to make sure that you don’t work on your business while at your day job.
2) Make sure that you maximise your free time. There are 168 hours in a week, so if you work 40 hours a week at your day job and you take out 8 hours sleep at night then that still gives you a potential 72 hours left to work on your business. Don’t overwork yourself and sacrifice your sleep. Make sure that you get enough sleep every night as overtiredness will make you feel ill, run-down, grumpy and will lead to bad decisions.
3) This next one will either make you or break you. You have to put your social life on hold. You have to look at it as a temporary thing while you get yourself set up in business. You can’t work full time and start a business AND see as much of friends as you used to. Make sure that you speak to your friends and family so that you don’t just drop off the radar all of sudden. They will hopefully understand the importance of your decision to start your own business and should be supportive.
What kind of business works best?
The best kind of business to start in your spare time is an online business. With this kind of business, you do not require your constant physical presence for it to function. With an online business, you can also work from anywhere in the world that has an internet connection. Technology has lowered many of the traditional barriers to starting a part-time business. E-commerce is a brilliant way to set up a business without placing a huge burden on the person running it. But, as running a company in your spare time can be exhausting, it’s wise to choose something you get pleasure from. Motivating yourself to work at evenings and weekends is a lot easier if you enjoy it. In case you need some inspiration here are some ideas of online businesses that you could start.
1) A buying and selling online store
This is one of the easiest things to do as you can start super small depending on how much money you have to buy stock. All you do is, pick the type of business that you want to go into and source products at the right price to sell on for a profit. As simple as that really.
This is when a company will pay you money if a user clicks a link on your site and goes through to buy a product. Basically, you can create an entire e-commerce looking website and just link the buy buttons through to the actual affiliate site and every time someone buys, you get paid a commission of the sale.
3) Start a Drop shipping business
Running any kind of retail business does take a considerable amount of hands-on time, but starting a drop shipping business is a little different from your average retail business. With a drop shipping business, you never actually touch the stock that you’re selling to your customers. Instead, the company buys stock from wholesalers and has them ship the products directly to the customer. You can start this kind of business relatively quickly. You’ll just need to decide what products you want to sell, how you’re going to sell them and where you are going to get products from. One top tip to making this incredibly competitive market a success is to have a really good brand and really find a way that you can stand out from the crowd.
So, hopefully, by now you will know what kind of business you want to go into. So let’s begin on how you can get started with your new business.
Planning your new business
For the best chance of making your new business a success, approach it with a professional mindset. Write a detailed business plan and set yourself realistic and reachable goals. Make sure that your goals take into account how much time you have available. If your new business is something that you get excited about, be careful not to let this cloud your judgement. You need enthusiasm and self-belief, but you must remain realistic. Make sure you think everything through, especially if you have responsibilities. Also, add into your plan your personal goals on what you want to achieve from the business. Maybe it’s to quit your day job or maybe it’s just to earn some extra income on top of your day job? Whatever it is, write it down, with the target figure that you want to reach every month. Again, don’t be ridiculous and write something that is totally unreachable. If you do that then you will just feel bad when you don’t reach that high target.
Outsource what you can
Since you haven’t got all the time in the world you can outsource functions like accounting, admin, order fulfilment and marketing. A great site to find people who can help is peopleperhour.com or fiverr.com. On these sites, you can hire people to do certain jobs for you. I would recommend outsourcing any jobs that take up a lot of your time. Always focus on what you’re good at and outsource the things that you’re not that good at. Try and avoid the thoughts in your head about trying to do everything. Even if you can do everything to a high standard, you haven’t got that much time so you need to prioritise what is most important in getting the business started. There’s no point in you spending all your time sourcing new products to add to a website that isn’t even built yet. Again, this goes back to my last point about planning. Write down what you need to do in the order of what is the most important.
Manage your money
When it comes down to actually starting your new business you need to make sure that you understand the money side of it. Otherwise, it just becomes a very expensive hobby with no return. Now don’t get me wrong, you’re not going to be rolling in it right at the start so make sure that you follow these quick top tips.
1) Get official.
Make sure that you register with HMRC as soon as you start spending money on your business or start to have customers. Register your business while you’re at it too. Trust me, it will save you time in the long run and you could get fined if you’re earning extra income without telling HMRC.
2) Put money aside.
Unlike your day job, you don’t pay tax as you go. You will have to work out how much tax you owe HMRC and pay them directly in a lump sum at the end of each tax year. So make sure that you set money aside for this. Depending on how you have set your company up, you may also have to pay National Insurance too.
3) Have a system.
If you feel like you don’t want to jump right into having an accountant at the start (even though I recommend that you do) you need to keep a record of income and expenses. It can be as basic as it comes as long as you record the important information that you need. Expenses lower your tax bill. Make sure that you keep all your receipts for anything business related.
4) Know your profit.
You shouldn’t really be focused on this at the beginning as it takes time to get going but I’ll still state the obvious. Make sure that you are actually making a profit on what you’re doing. Just because you’ve bought something at £5 and you’re selling it at £10 doesn’t mean you’re making a profit if you are selling that item with free shipping and it’s costing you £3 to send out and then an extra £2 in packing costs. Figure out your markups but also try and keep competitive. Read our blog post on how to stand out from the competition.
5) Don’t let money bring you down.
Lots of people don’t like doing their finances but in business, it’s one of the most important things. Don’t let finances suck the life and enthusiasm out of you. It can take years for many businesses to show a profit. It doesn’t always mean that a business is doing badly if they don’t make a profit, every single business is different. As long as you know why your business isn’t making a profit then you could potentially still be onto something good. An accountant can make sure you’re doing things the right way while you crack on with what you’re good at.