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The risks and rewards of starting your own business

Tuesday, 8 November 2016

Starting your own business can be a daunting task, but it could also be the most rewarding experience of your life. Read on for an overview of the good and the bad of starting and running your own business.

Why you should do your own thing

So, you dream of becoming a small business owner? Or maybe even the CEO of a major new corporation. Here is a list of reasons why most people dive into the exciting world of entrepreneurship:

  • You will have more freedom and, eventually, more time to do the things you love.
  • Financial independence is on the horizon – if your business becomes successful & self-sustaining.
  • You could create job opportunities for others.
  • You will meet a lot of new people through networking and negotiations.
  • Bragging rights: people will admire you for your entrepreneurial skills.
  • You could benefit from government incentives & tax paybacks.
  • You can’t get fired or retrenched when you work for yourself. But, you’ll probably work harder than you’ve worked in your entire life!
  • You will develop new skills and make innovative discoveries.

The risks you might face

Many businesses fail within the first few years, or even months. This is because individuals aren’t aware of the risks of having a start-up. Take a look at some of the risks listed below:

  • Poor planning. This can cause havoc. You should have a proper business plan in place, and consult with industry professionals before putting any money towards your business.
  • Running out of money. You’ll need enough money for all the start-up costs, as well as extra cash for those “ifs” and “whens”. Remember, your business might not start generating cash immediately.
  • Having too much ambition. Yes, this could be a bad thing! Over-expansion could lead to financial distress. Start small, and develop the business as your cash flow increases.
  • Losing your health. It is important to consider death/disability/serious illness. Who will be responsible for debts if this happens? Make provision for the future by getting life insurance products for your specific needs.

Insuring your hard work

As soon as your business gets going, you’ll need comprehensive business insurance. Insurance will cover the cost of business interruption, office contents, employers’ liability, theft of/damage to your business vehicle, and much more. If you need a business insurance quote, you can give one of our trusted consultants a call today and they will guide you through the process while providing you with quality service.

Terms and conditions apply. This article should not be construed as financial advice and is provided for information purposes only.

Information obtained from:

20 reasons to start your own business
6 commonly overlooked risks when starting a new business

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