Number 1 Advice In Entrepreneurship
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Author: Janice Wee
Article source: http://www.punditpreneur.com/. Used with author's permission.
Years ago, when I told an old friend I was quitting my job to go into business myself, she strongly advised me against it.
Her reasons were many. I had a good education. I could get a job with a decent pay with a regular monthly income. Something she, as an entrepreneur herself never had.
Also, the statistics I read about business start ups were really dismal. Back then, and the economy was better then, 90% of the start ups don't make it past the 1st year. Of the 10% who do, 90% close down within 3 years. The failure rate is very high.
We now live in a global economy.
Competition is keener than ever. If you are an internet business, you compete with the best such businesses all over the world.
Her advice to me then, when she saw I was serious about leaving my job to start a business was this.
When times are good, you may feast on lobster. When times are bad, you may only be able to afford plain rice and salt.
She went on to explain that in the eighties, business was booming. Everyone made plenty of money in the costume jewelry manufacturing industry. She was a wholesaler. So was her neighbour, the store beside her. Those were the good times.
Things changed. Now, she can barely make enough to break even. Her neighbour had it worse. Former neighbour actually. He couldn't even pay the rent.
When times are good, plan ahead. Don't spend all the money. Set aside some for a rainy day, which will come. Business is cyclic. During bad times, at least you have some money to go by while you work to recover your business.
Several years have passed.
I have seen really good times. I remembered her advice and was prudent in my spending. I saved what I could and only spent where necessary. The internet world is so volatile. One moment you are right on top. The next, your business could go plummeting down like a deck of cards. Sudden entry of massive competition. Competitors with VC funded bottomless pockets who gobble up your niche. A paradigm shift. These things happen... all the time.
In every business, one has to be prepared for change. To adapt to new surroundings.
Her advice helped me save. I have savings to live on, to pay the bills while I work twice as hard to turn things around, with both eyes wide open, adapting to new circumstances. The writer is the webmaster of http://www.independantlife.com
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