4 Signs You’re Not Ready to Become a Small Business Owner

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Small business ownership isn’t for everyone. Read on to see why you may not be quite ready for it. 

Starting a small business could end up being a very rewarding experience for you. There’s nothing like the feeling of bringing a great idea to life and turning it into something that provides you and your family with a steady stream of income.

But starting a business isn’t something to dive into casually. It’s important to make sure you’re prepared logistically and financially, and that you’re in the right frame of mind to be successful. With that in mind, here are a few signs that you may not be ready to start a business of your own.

1. You don’t have a lot of savings

LinkedIn says that it takes three to four years on average for a new business to become profitable. And until your business turns a profit, you may not have access to income.

That’s why it’s so important to go into business ownership with a solid level of savings. It may not be feasible to sock away enough money in the bank to cover several years of living costs. But one year’s worth of expenses may be both reasonable and doable. If you’re not at that point, though, then you may want to hold off on starting a business.

2. You’re looking to turn a quick profit

It’s important to have realistic expectations when you’re starting a business. If you’re aiming to turn a profit within a few months, you may want to rethink your plans, since we just learned that it can take a lot longer than that for your company’s bank account balance to grow.

One thing you may want to do before starting a business is set a timeline mapping out your goals. You might tell yourself that you’d like to break even by year two and be enjoying a profit by year three. But if you’re not willing to be patient, then you may want to stick to your current job so you don’t set yourself up for disappointment.

3. You don’t have a business plan

It’s not enough to have a great idea and run with it when you’re starting a business. Rather, you need an actual business plan — an official one you can refer to as you get your venture up and running.

Your business plan should include details such as:

Your strategy for marketing your product or serviceYour estimated expensesYour anticipated challengesYour strengths and weaknesses

It could pay to hire a consultant to help you map out that plan. Yes, you’ll be spending money, but it could help set you on the road to success. But if you’re not willing to invest time, effort, and maybe money into that plan, then you may not be ready to own a business just yet.

4. You don’t have a lot of self-confidence

A big part of being successful as a small business owner is having confidence in yourself. If you’re feeling anxious about your prospects and doubt your ability to do well as a business owner, then starting a company of your own may not be your best move.

Of course, you can’t just snap your fingers and gain confidence overnight. But one thing you can do is spend time talking to business owners and doing research so you gain more knowledge about what you’re getting into. That could help you feel more confident in your ability to pull your business off.

Small business ownership isn’t for everyone. And if these signs apply to you, you may want to hold off. But that doesn’t mean you have to write off the idea of starting a business. Rather, it could just mean that it’s a good idea to wait until you’ve addressed a specific shortcoming, whether it’s a lack of savings, planning, or self-esteem.

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