Making the transition from a full time employee to a small business owner is something that many people dream about all the time. Some people have great ideas, others have business plans, and many operate a business on the side in their spare time, hoping to one day make the leap from part time projects to full time business.
Working on a business part time is one thing, but actually making the leap to running a business full time without the safety net of your full time job is a HUGE step to take. It’s not a decision you should make lightly, and there are a number of important considerations you need to take into account.
Before you up and quit your job to focus on running your business, you need to consider the benefits and potential drawbacks of taking the leap of faith. Ask yourself:
1. Will my projected income from my business be enough? A full time job offers you one significant benefit – a regular income you can depend on. You can use this money not only to pay the bills but also to help fund your start-up.
2. What is your financial plan? How much do you plan to pay yourself when running your business? Do you plan to rely on your savings? Do you have enough money banked that you will be okay if things do not go according to plan?
3. Is the timing right? Timing will be dependent not only on your financial situation, but also based on the type of business you operate. For example, if you’re launching a landscaping business, it probably doesn’t make sense to quit your job during the winter.
4. What is my plan B? Every small business needs a back-up plan. Do you have an option to go from full time to part time to ease your transition? Can you go back to your old job and pick up some hours if your business struggles out of the gate?
5. Am I ready? This is perhaps the most important question to ask yourself. Are you ready to be a small business owner? Are you willing to put in the extra hours and do what it takes to make your business a success?
There will never be a perfect time to quit your job. Taking a leap of faith and running your business full time is dependent on many factors, and they will vary from business to business. Ultimately, you will know when the timing is right.
Before making the transition, it’s important to protect your new business with business insurance that meets all your needs. Get the coverage you need by getting a business insurance quote online.