When starting a business, Benjamin Franklin’s famous phrase ‘Time is money’ could not be more apt.
Now, I am not advocating that everyone should rush head-long into starting up a business. However, rather than procrastinate, some people definitely should pick up the pace of start-up.
Over the years, I have met plenty of would-be entrepreneurs who should have started up their enterprise straight away. They knew what they wanted to do and had the requisite experience. The next step was to launch their business boldly into the market.
Instead – and it is a great shame – they planned, planned and then planned some more … until they planned their way directly into business oblivion.
So what are the issues to consider when working out the pace of your start up? Here are two critical factors I believe must be considered:
1. Where are you in life?
Timing pressures are very different for people depending on where they are in life. Let’s compare two cases.
Case A: Slow and steady is fine
A single woman in her 20s decides to start up a business. She has no dependents, a part-time evening job and can off-set the cost of living by returning to ‘Mum and Dad’s house’ where food, board and a raft of business necessities such as phone, ADSL, equipment and furnishings can be accessed for free or at a steeply discounted price.
In this case, time is on her side and even if a little is wasted in the start-up process, there will probably be few significant consequences.
Case B: Get cracking today!
A middle-aged man is retrenched from his corporate job. He supports a wife and young family. Overheads include mortgage, car, food, credit card bills … and all the other daily fixed costs of living.
In his situation, every day that passes is eating into the family’s precious savings. Getting active, operational and earning income as fast as possible is absolutely essential. So there is, literally, no time to waste.
2. What type of business will you undertake?
The ability to start a business and the time it takes to bring your product or service to market is also driven by the type of business you are planning to launch. Once again, let’s look at two examples.
Case A: Take your time and invest in the plan
You want to start a new fashion retail business in a local shopping strip. With start-up retail, there are significant upfront costs. These include leasing premises, shop design and fit-out, buying stock, pre-launch marketing activities and staffing … all before your first client walks in the door and purchases a single garment.
In this case, meticulous planning and tightly orchestrated time management is vital to minimise pre-opening costs. Each extra day can equate to significant and rising costs so it definitely pays major dividends to micro-manage timing.
Case B: Go! Go! Go! And don’t look back.
You want to start a consultancy business. Cost of start up is relatively low as you are using your own ‘brain power’ (intellectual property) and network to secure work and operate the business. Basic business essentials you will require include appropriate business structure, corporate ID and collateral, website, email, insurance and some technology solutions. As you are working out of home, a serviced office or sub-leasing some space, you do not have significant overheads.
In this case, go out hard and fast. Importantly, be flexible and always on the alert to meld your business to the actual demands of the market. Planning does have value. However, compared to the benefit of taking your business into the real world and getting real-time, direct feedback from the marketplace, it is very limited.
When thinking about starting a business, remember ‘time really is money’. Keep in mind though that the implications of time are very much dependent on your personal situation. So ask yourself, just where are you at?
Matthew Abrahams is managing director of Business Switch. He has founded, led and advised on the establishment of businesses in Australia and throughout the world, including for global corporations and major government agencies. A former executive at Macquarie Bank, he formed Business Switch after being personally frustrated by the time, cost and stress involved in starting a business in Australia.