When I resigned from my job to focus on But the Books it was the easiest decision I've ever made. I'd known that I needed to do it for a long time, but as a hugely cautious person, it's also one of the bravest decisions I've ever made … and I've jumped out of a plane! Leaving the security of my monthly pay cheque to do my own thing is huge, but if you have a side-project you know just how much of a balancing act having a job, a life and a family can be and there does come a point when you have to decide whether you're going to go for it or not.
I didn't just blindly hand in my notice though. In deciding what to do I gave a lot of thought to the business, its viability and its finances, as well as my own personal finances. There was a lot I needed to bear in mind, and the decision for everyone will be different. Here are 6 of the questions I asked myself before I decided to take the leap.
1. Is this really a business?
A long time ago, my friend had a little craft "business". She made handbags and jewellery and loved buying craft materials and turning them into things she could "sell". She would spend whole weekends making things, and haul goods down to craft fairs all over the place, pay £10 for a stall, and maybe sell something for £20 all day. It wasn't a business, the stall next door, which sold out of cakes within two hours flat, every time, was a business. What she had was a very expensive and time consuming hobby. It's fair to say that craft wasn't her calling, but she had a strong entrepreneurial drive and kept going (she sells cakes now). I helped her with her figures, to know how much she was selling each month, what her costs were, and the extent of her profit.
Being realistic about your business is so important in deciding whether it could ever support you. When I went full time with But the Books, I did my sums and I had a good idea of how much the business could afford to pay me every month. I know how much the business has in the bank in case there's a quieter month, and I know how much the business needs to sell every month to cover its expenses and then to pay me.
2. Can the business grow?
I built But the Books up by working on the business just one day per week (plus stolen time in the evenings and at weekends) so the amount I thought the business could pay me based on the numbers then, is less than now when I'm focused on the business full time. I knew my business could be scaled. There were more potential clients out there should they wish to work with me, and with more days I could do more work. I knew that there was the option of taking on staff to help me take on even more work one day in the future. From just me, we now have a team of four working at But the Books.
3. Can I afford it?
Of course, initially you’re going to be earning less in your business than you would be in your paid job, so in the meantime you need to look at how much you need to contribute to the family finances and see whether a combination of what the business can pay you and personal savings will be enough. If the business can’t pay you enough or your personal finances are a problem, I would caution against taking the business ahead at this point.
4. What are my goals?
It's easy to make assumptions that the business will just grow, so it's important to set goals about what that growth will look like and how to get there. In the beginning I looked at my current sales figures and what I'd like to reach in the next three, six and 12 months. I broke that down into smaller targets based around the number of clients I had at any one time, the number of other jobs I needed to be doing each month and how that will work with the time I have available.
Goal setting can feel scary but it's important to know where you're heading so that you can do the things you need to do to get there, it also helps you identify when things aren't quite going to plan so you can get back on track or work out what you need to change.
5. What's my time frame?
All businesses have their ups and downs and it can be tempting to try to stick it out when things don't work out initially, but at what point do you call it a day? It's important to have a make or break point in the diary, and regular targets and review points will help you keep on track and ensure you don't get swept away with the business, just hoping it will take off. I had a 12 month window to make But the Books a success. Still here!
6. What's my escape plan?
And if the business fails, what will you do? As an accountant with 15 years of experience working for large organisations, I hoped it would be fairly easy for me to find a new accounting role if I needed one. If things hadn’t worked out in 12 months, that was my escape plan. Sure, I'd be disappointed, but I'd know I'd given my business everything. Today somebody told me they'd once had the opportunity to go freelance, they hadn't taken it and had always regretted it. I don't ever want to find myself telling that story.
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