It's the leap from comfort zone, to the unknown. For many people, this jump is too much. The good news is that an increasing number of individuals are starting to take this leap of face - and are reaping all the self-employed rewards that come their way.
Of course, in and amongst the rewards are a whole host of risks. We don't need to throw at you the start-up statistics that frighten so many people. In short, many of these young companies fail, and your objective in the first year or two is not falling into said category.
To help you do this, we have put together this guide. Granted, there are all sorts of other moving parts when it comes to self-employed life but making sure you avoid these four mistakes can be the difference between start-up success and failure.
Your company needs a marketing plan
For some reason, a lot of companies just don't have one. A business owner thinks that their region needs a particular service, or they think that they have devised an innovative idea which is going to have customers flocking to their doors.
Unfortunately, it seldom works like this. Even the best products need a marketing plan. For some it might be handing out leaflets, while others might invest in an online strategy. Regardless, make sure your customers are finding out about your new existence.
Pay attention on tax from the start
While the above is important, you also can't forget about the formalities. Tax unfortunately falls into this bracket and we hate to break the news that this is something that you are now completely responsible for. There's no employer doing the legwork for you; it's all on you.
It means you need to learn more about SA100, or just simply realize that each transaction you engage in needs to involve tax. The last thing you need is to be left with a huge bill at the end of the year.
Buying luxuries you don’t really need
You’re now self-employed, but this doesn’t mean to say that you need the shiny office and company car. On the contrary, you need to operate on a budget during the early days. Only buy what you need as those first few months will be tough and you will need that cash to pull you out of some situations.
You forget cashflow
Let’s leave the most important element until the very end. You might be wracking in the contracts, and seemingly making a real go of your business. Then, out of nowhere, you realize that the cash has dried up.
What’s happened? You, like many other businesses, have suffered with a cashflow problem. It’s almightily common but worryingly, it’s something that can cause some businesses to close their doors completely. You need to make sure that your invoices are being paid on time as even though you might have a backlog of work, all of this is for nothing if people aren’t paying you on time.