⌚ 4 min read
Being your own boss! Making your own hours! Freedom and the feeling of doing something important!
The fruits of entrepreneurship are tempting to many. But when it comes to actually working to make these dreams a reality, many also realize that it’s not that easy.
However, the ones that have “made it” will tell you that just because something isn’t easy, doesn’t mean it isn’t worthwhile.
That said, there are certain risks that come with entrepreneurship that you must learn to overcome. And what’s the best way to overcome any obstacle? To have a game plan ready!
That’s why we’ve listed out the most common risks entrepreneurs will have to face and given you our two cents on how to overcome these dangers.
No regular income - It takes time to start earning money. And even when you do, most of it will have to be reinvested into your business, so paying yourself often comes last.
The Fix - Have about six months of income saved up for yourself before you start your business. You’ll need something to live off of as you invest into your company. Also be prepared to cut back on “extra” expenses. Living minimalistically for a while can pay back down the road.
Unsteady cash flow - Your cash flow depends on how much you sell. Even when you have clients lined up, unexpected circumstances can occur, like repair costs or clients not paying on time. During these situations, it’s important to be able to cover your everyday expenses, so one setback doesn’t send you to the ground.
The Fix - Just like you should have enough money saved for your living expenses, you should have a rainy day fund for your business as well for when things take a turn for the unexpected. Know exactly how much you need to cover your daily expenses and account for breakdowns, losses, defaulting clients, fees, etc.
Changing markets - Consumer preferences and market demands can change at the drop of a hat. Your business must be able to pivot should you suddenly find yourself in a changed market with undesirable products.
The Fix - Analyze what you're offering and determine if it’s likely to be a fixed market demand or more of a trend. Either way, have backup plans that you can quickly revert to should the demand for your product or service type change.
No time - One of the main states of being entrepreneurs find themselves in is the “no time” realm. They’re spread thin between responsibilities within their business and overseeing just about everything that goes on. Before long, burnout becomes the main state of being.
The Fix - Leave time for yourself! Schedule a time at the end of the day when you turn off your phone and shut down your laptop and focus just on your needs. Learn to delegate responsibilities and schedule your time during the day to avoid feeling overwhelmed.
Health problems - When you work for someone else, you can call in sick and expect everything to run smoothly without you. Not the case when you’re the boss.
The Fix - Running yourself to the ground can seem like it’s good for business in the short term, but in the long term, you will be left defeated and without the energy to commit yourself to your business. Put a focus on getting enough sleep, eating well, decompressing at the end of each day, and moving your body.
Rollercoaster of emotions - After the initial excitement and pride of starting a business, a whole onslaught of other emotions take center stage. Problems, obstacles, failure, and every other pitfall that comes with entrepreneurship takes an emotional toll on individuals.
The Fix - Know that some dark times are likely to come and be prepared by having a contingency plan in place, but also have an emotional support system you can trust that will help you get back up.
Competitors - Whatever your business is, there will be competitors to contend with. Some will play fair, others will work on making business hard for you and even try to steal your ideas.
The Fix - Know the ins and outs of your competitors’ businesses and who the key players are within each company. Protect your business with trademarks, copyrights, and contracts for anyone that has access to sensitive information.
Neglected relationships - Entrepreneurship carries a lot of sacrifice with it, but you should give it your all to not let your business aspirations affect your relationships with family.
The Fix - Help your loved ones understand that while you may not be there for every dinner or family day at the park, they’re still your number one. Try to include them in your business as much as you can to help them understand your passion and commitment.
In short, there are risks you will have to contend with. However, these risks do not and should not be the reason you don’t set out on your journey or be the reason you give up at the first roadblock. Each of these risks can be mitigated and resolved as long as you are prepared ahead of time.
So, take a deep breath and take your first step towards becoming your own boss.
Still hesitating? Check out our coaching programs to make the journey a whole lot easier.