Welcome to another edition of my Weekly Journal! I use this space to share about my journey from lawyer to jewelry business owner. This is part three in a series where I'm sharing what it's really like to be a small business owner and if that path is right for you. So many of you want to start your own business someday and it's important that you have a realistic picture of what that entails. Today we're talking a little about money and what you need to think about before you quit your day job and start your business.
First and foremost, I think a lot of people believe they have a viable business the minute they set up a business Instagram account and create a free website. You know the whole "if you build it they will come" idea from the movie Field of Dreams. They plan on quitting their job on a Monday and starting their business on Tuesday with cash starting to flow by Friday. But that couldn't be further from the truth. It takes time to build a legitimate, profitable business. No one can buy from you if they don't know about you - this is why we engage in marketing, which is building awareness of your brand - and unfortunately marketing doesn't work instantly. It takes time. Some people say that no one will buy from you until you've built the know, like, and trust factor. They know you and your business exist, they grow to like you and what you sell through various interactions with you and your business, and then they grow to trust you enough to buy what you sell. If you're selling something that costs $5, the know, like, and trust factor can be established quite quickly. But if you're selling something that's $100, it's going to take more time. You feel me? Before they shell out $100, they're going to need a little more from you in order to feel confident about their purchase. In short, this is why you shouldn't believe anyone who tells you that a business can be built overnight. Sure, there are "overnight successes" but they are usually fast and fleeting. A one hit wonder. They don't make it for the long haul.
So, what does this mean for you? Well, you need to get realistic about money. You need to accept that you aren't going to quit your job on Monday and start your new business on Tuesday with cash flowing on Friday. Instead, it's going to be more of a process. And you're going to need to have an alternate source of income or a large savings account for the meantime. Preferably, you'll stay at your current day job and work on your business at night and on weekends. So many people grumble at this idea, but listen - if you aren't willing to do this, you probably aren't cut out to be an entrepreneur anyways. Building a business takes a lot of hard work and dedication and it's going to require long hours at times. If you aren't willing to do that in the beginning - when your excitement about your new business is arguably at its highest - then you probably aren't going to be willing to do that 2 years in, when excitement is waning and you're wondering if it's all worth it.
Ugh...so when can I quit my job, you ask? The answer is different for everyone. It varies from living situation to living situation and from business to business. Perhaps you have a husband and you can go on his health insurance and rely on him to pay the mortgage. Or perhaps you're single and all of your living expenses are your responsibility. Perhaps your business is a service-based business like career coaching that doesn't require a lot of monetary investment in products and inventory, compared to the woman who wants to start a high-end clothing boutique which requires a lot of costly inventory to start. You see what I mean? There isn't a one-size-fits-all answer. As your business grows, you'll know exactly when you have enough business revenue to support the business and pay your bills, and only then should you quit your day job. Remember you can always go part-time too when your business starts to earn revenue but not quite enough to support 100% of your expenses.
I always get this question too, so I'll answer it here: "What if my current job is too stressful and too demanding? I don't even have time to wash my hair let alone start working on my business website." Well then, perhaps you can get another full-time job with less pressure so that you do have time and energy to work on your business during nights and weekends. Listen, if you want what you've never had, you need to do things you've never done. I know all of this can be scary, but it's not rocket science. The answers to these questions are quite plain and simple. We make it complicated. We make up excuses as to why it's not feasible, when in reality that's our fear talking. So get real with yourself - do you really, really, really want to start your own business? If the answer is a whole-hearted yes, then look at your situation creatively and make the decisions and the moves that need to be made. It's temporary. If all goes well, you'll be quitting your day job and working full-time on your dream in about 2 years. 2 years! That's nothing. (side note: where did I get 2 years from? The average business takes about 2 years to start seeing consistent profit.)
I hope this real talk is helpful. I'll be back next week with more ways to think realistically and practically about potential business ownership. It's so important to get clear on that stuff before you invest a lot of time and money into your business idea. If there's a topic or subject you want me to address in this series, leave a note in the comments!
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P.S. Are you on Pinterest? I'm in the process of creating a Weekly Journal board on Pinterest so you can easily navigate all of my journal entries. You can view and follow the board by clicking here. I've written so much about quitting my lawyer job to start g+h over the past couple years and I want to make it easier for you to access and read the entries that resonate most!