New business owners face hurdles

A unique idea, a bit of genius and a lot of luck could lead to success

Advertisement

— Scott Ford chuckles to think of all of the people who have told him they want to start their own business because they don't enjoy the company of their present boss.

"When you run your own business, do you know how many bosses you have?" Ford asked. "You have hundreds!"

Ford runs the Small Business Development Center at Colorado Mountain College. He made his remarks Friday while teaching a one-day seminar on "How to Start Your Own Small Business." The 16 people attending the class ranged from people who hadn't yet come up with an idea for their own business to some who had already started a business and were planning their second.

Ford said people who want to start a business solely to be their own boss might not have what it takes. Likewise, people who dream of starting a business so they can spend their days at the beach while their employees do the grunt work may not be cut out for their own business.

In fact, the business owner has plenty of bosses, from accountants and attorneys to the Department of Revenue, Ford said. Oh yes, and there are the thousands of customers every business owner hopes to have. Believe it or not, some of them will think they are your boss, he said.

To succeed in business, Ford said, people need a unique idea, a little bit of genius and a big dose of old-fashioned luck.

Before you decide whether starting your own business is right for you, it's worthwhile to spend some time trying to objectively evaluate your own skills and inclinations, Ford said. The skills new business owners will need include: customer service follow-up, tracking competitors, advertising copy writing, cash flow planning, bookkeeping, hiring and firing, written communication and the ability to manage risk and stress.

Bookkeeping might be the most important of all, Ford said. And too many people dismiss that role as something they'll delegate to their accountant.

"Your accountant can't run your business for you," Ford said. "If you're going to start a business, get ready to get baptized into bookkeeping."

If a business person lives close to his or her own books, they'll know exactly where they make their money, Ford said. Just as importantly, they'll have a clear picture of where they spend it.

"I talk to people who are good folks, who don't know where the money is going!" Ford exclaimed during last week's class.

Ford confesses that keeping books is not one of his own strengths, but he ardently recommends that even if they don't have enough of an accounting background to keep a double entry system of debits and credits, prospective business owners at least undertake a single entry system. Such a system amounts to a simple list of expenses and income. For people who have little if any experience in business, Ford recommends a fairly intensive exercise that will test their willingness to keep books.

People who aren't doing it already, and are serious about starting a new business, should begin keeping a monthly household budget, perhaps on a simple computer spreadsheet, Ford said.

"Start doing a monthly budget. If you aren't, your chances of (business success) are very, very small. Become a fanatic about writing everything down," Ford urged. "This is the best exercise you can undertake. When you faithfully keep a monthly budget, you'll be surprised at how much you spend."

The skills gained by keeping a personal budget will transfer well to a fledgling business, Ford said.

Although he says bookkeeping skills aren't his strength, computer skills are definitely his long suit. To be effective in business today, computer skills are a must, Ford said.

"Increasingly, that's how information is moved today," Ford said. "To say, 'I don't do computers,' that's like looking at me and saying, 'I don't do pencils.' You can do it, but you'll just be extremely handicapped."

Even a minimal presence on the Web is a big plus today, Ford said.

"You're almost looked upon as defective if you don't have a Web site," Ford said. "Our interface with this environment will just continue to grow."

Still, he thinks for several years to come, the Web as a source of information will supersede the role of e-commerce for small businesses.

The Internet is an invaluable way for people contemplating a new business to do their basic research, Ford said. They can research existing trade names and government regulations online. They can also research competitors.

However, computers aren't a substitute for face-to-face personal skills in one form of research that Ford recommends. Mountain towns are unlike other business environments, and many of the rules that apply in bigger cities don't apply in Steamboat, Ford said. Fortunately, mountain resort towns share many of those qualities that make them different from almost everywhere else.

Someone planning to open a fly fishing shop in Steamboat probably wouldn't get very far quizzing the local shops about the relative success of their business. But for the price of lunch, the proprietor of a fly fishing shop in Jackson, Wyo., more than likely would be pleased to give out advice on how to succeed in business. Small business owners in other mountain towns have less to fear from newcomers as a source of competition, he explained.

Another quality that is essential to survive as a small-business owner is limitless optimism, Ford said. People who flog themselves with self doubt are often doomed to fail.

"If you're someone whose glass is always half empty, owning our own business will drive you absolutely stark-raving made," Ford cautioned. "You need to be, in many ways, your own biggest fan. You've got to have faith that, 'Yeah, it's all going to work out.'"

Comments

Use the comment form below to begin a discussion about this content.

Requires free registration

Posting comments requires a free account and verification.