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Is It A Terrible Time To Be Thinking Of Starting A Business?

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Reading Suntory's "We Are Facing Another Global Financial Crisis Of Epic Proportions" thread on the main forum underlines to me the troublesome economic times we are currently living in.

That being said, both my partner and I are coming to the conclusion that we are fed up with the insecure nature of our jobs (short term contracts) and are seriously considering the possibility of putting some of our (relatively modest) life savings towards starting a small business. This is something that we have casually talked about for years and think we would enjoy doing, but are now giving it some serious consideration for the first time.

Without going into too much details about the type of business, location or any of those other kinds of micro details, I would be interested in people's thoughts about the current climate for this kind of venture, and a more macro kind of analysis of factors that we should consider, such as a discussion of business cycles for example (of which I currently know nothing, but am keen to learn!).

This will help me to decide whether we are possibly being massively naive or foolhardy in even contemplating taking such a risk at this particular moment in history when we are potentially on the eve of an almighty global recession!

Basically, are we mad, or is this as good a time as any? Or wait a few years to see what transpires?

Any thoughts most welcome :)

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Looking at this from a very high level - I would reckon starting a business at a time when things are a bit shitty makes more sense. If you can make it work then - the money should come rolling in once things get better.

Unless its the repossession business or payday loans etc.. of course.

But in reality - ****** knows.

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Great stuff, thanks.

I think local, needs based, frequent transactions is ideal. I look at an unpromising bakery/sandwich shop near us in a small parade of shops that was bought about a decade ago. They just made the entire feel and proposition very much better. Soon there were queues out the door and workers would make it their stop for buying lunch. It then added a cafe and eventually took on the premises next door. Fantastic opportunities wherever you look, as long as you can run things well, I don't think there's never a time to be in business.

This is fairly similar to the kind of thing we are considering - see ample opportunity to do things better than businesses who themselves seem to be doing ok, so in theory we should be able to at least make it work?!

What he said, when going S/E or starting a business you're properly benchmarking yourself against reality. Recession is opportunity if you're better than the rest.
I wish I'd done it years before, working for other people sucks and PAYE taxation & NI just puts the boot in harder.

That's what I was wondering too.

I also worry about how it might interact with our need to keep a roof over our heads! I imagine that lots of business owners have little or no mortgage outgoings, having bought when property was affordable and paid off their houses by now, hence they could weather a downturn in profits more easily than could people (like us) who have to pay a relatively high rent every month. But this little anxiety would inevitably be confirmed/appeased in viability calculations further down the road...

I would also be really interested in any recommendations for books or other resources that give advice on starting up a business, there seems to be a lot of dross about so good to know what is worth a read!

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Great stuff, thanks.

This is fairly similar to the kind of thing we are considering - see ample opportunity to do things better than businesses who themselves seem to be doing ok, so in theory we should be able to at least make it work?!

That's what I was wondering too.

I also worry about how it might interact with our need to keep a roof over our heads! I imagine that lots of business owners have little or no mortgage outgoings, having bought when property was affordable and paid off their houses by now, hence they could weather a downturn in profits more easily than could people (like us) who have to pay a relatively high rent every month. But this little anxiety would inevitably be confirmed/appeased in viability calculations further down the road...

I would also be really interested in any recommendations for books or other resources that give advice on starting up a business, there seems to be a lot of dross about so good to know what is worth a read!

My experience is that you need to have a driver to push the business forwards. Not having a mortgage hanging over your head, OK, that means you will be under less financial stress, but it also means that you might not pull out all the stops to make the business work. Some people need their backs against the wall to make things happen.

I think that there is never a bad time to start a good business. The key is to find a good business plan and execute it. Make sure you get a lot of miserable sceptics to review your plan and point out the disadvantages. They will come up with some negatives, and its up to you to decide whether they scupper the plan or not.

In small business there is no place to hide and the business never sleeps if its worldwide. Bear that in mind.

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As others have said if you can make it work now ,it will only get better

Been thinking about doing the same (again) have done it before built a small business but grew to hate it and sold my interest in it on (partnerships realy very rarely work) i will learn to listen one day

I was in a similar position to you concerning work and back in the same position now , but what i will say it`s far more work working for yourself than that of being an employee at least for the first few years i personally found it was a 24/7 occupation just by the virtue that you don`t rap up for the day and that's the day over and switch off al la employee style i found i would be constantly planning/thinking and found it very tiresome and unable to relax /totally switch off but also felt far more in control and secure

I can see why people turn to drink

I think the ultimate trick is finding something you enjoy which is a viable proposition especially if it`s going to be a 50 weeks a year job ,i was doing something i "thought" i would enjoy but it turned out not to be so

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In small business there is no place to hide

Plenty of places to hide in that new pod business.

No advice to the OP here. I failed to get my business to make any money, after spending all my time on things I thought worthwhile and interesting but too far removed from anyone with a budget.

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As others have said if you can make it work now ,it will only get better

Been thinking about doing the same (again) have done it before built a small business but grew to hate it and sold my interest in it on (partnerships realy very rarely work) i will learn to listen one day

I was in a similar position to you concerning work and back in the same position now , but what i will say it`s far more work working for yourself than that of being an employee at least for the first few years i personally found it was a 24/7 occupation just by the virtue that you don`t rap up for the day and that's the day over and switch off al la employee style i found i would be constantly planning/thinking and found it very tiresome and unable to relax /totally switch off but also felt far more in control and secure

I can see why people turn to drink

I think the ultimate trick is finding something you enjoy which is a viable proposition especially if it`s going to be a 50 weeks a year job ,i was doing something i "thought" i would enjoy but it turned out not to be so

I think you should start a business involving booze.

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Plenty of places to hide in that new pod business.

No advice to the OP here. I failed to get my business to make any money, after spending all my time on things I thought worthwhile and interesting but too far removed from anyone with a budget.

I think it takes as much bottle to call it quits as it does to start up in the first place in many cases, esp. if you have built something large but unviable.

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My experience is that you need to have a driver to push the business forwards. Not having a mortgage hanging over your head, OK, that means you will be under less financial stress, but it also means that you might not pull out all the stops to make the business work. Some people need their backs against the wall to make things happen.

I think that there is never a bad time to start a good business. The key is to find a good business plan and execute it. Make sure you get a lot of miserable sceptics to review your plan and point out the disadvantages. They will come up with some negatives, and its up to you to decide whether they scupper the plan or not.

In small business there is no place to hide and the business never sleeps if its worldwide. Bear that in mind.

That was the hardest part for me it never sleeps ...and mine was not world wide , the rest of the post is very good advice the easiest person to convince you, you are right is yourself

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I think it takes as much bottle to call it quits as it does to start up in the first place in many cases, esp. if you have built something large but unviable.

Yep ,i found it hard to admit to myself i had made a mistake even though it was a viable business and it still is

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As others have said, never a bad time to start a good business. Consider which part of the business cycle your business targets (e.g. pawn brokers do well in recessions, expensive tat shops in booms). If it can be a global internet based business, then maybe it will be always booming somewhere.

Try not to create a job rather than a business. Ideally, you want to be a business owner and have staff or computers do the work for you. Always be considering how you can be designing yourself out of the business and taking the profits. Otherwise, you have just created yourself a job with additional stress and responsibilities.

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I guess the most important thing you can do is find some way to gauge what the demand for your product/service is before committing everything to creating it i.e. don't just build it and hope they will come.

There's a burrito chain here in Belfast that has exploded in recent years; queues down the street, making a fortune. Over the last 3 years or so other burrito shops have come and gone; there seems to be a brand loyalty.

I know someone who was employed by a chap who was considering setting up a restaurant to sit outside the burrito shop in question, and count how many people went in over the course of a few days. To get a measure of footfall and demand before investing a ton in setting something up.

Good luck with your new business - it'll be hard work but the feeling of being in control of your own destiny and having created something from scratch must be great. I admire anyone with the balls to do it.

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I guess the most important thing you can do is find some way to gauge what the demand for your product/service is before committing everything to creating it i.e. don't just build it and hope they will come.

There's a burrito chain here in Belfast that has exploded in recent years; queues down the street, making a fortune. Over the last 3 years or so other burrito shops have come and gone; there seems to be a brand loyalty.

I know someone who was employed by a chap who was considering setting up a restaurant to sit outside the burrito shop in question, and count how many people went in over the course of a few days. To get a measure of footfall and demand before investing a ton in setting something up.

Good luck with your new business - it'll be hard work but the feeling of being in control of your own destiny and having created something from scratch must be great. I admire anyone with the balls to do it.

You're not in control of your own destiny because a lot of the time luck has everything to do with it. You can make your own luck to some degree, and if you are persistent sooner or later luck will turn. But to ride out the periods of bad luck can be hard work and take a lot of mental strength. Stuff can appear out of nowhere that can hammer you, and bad things always come in 3's IME.

There's a saying that most of the people who become hyper successful in business have a least one bust before they find a formula that works, or get lucky for long enough to form a self sustaining business.

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Make sure you can cope with a hefty fall in revenue - I have a margin of 30% minimum less than you expect in mind. We had that margin and needed it when we bought in late 2006. We had one good year and since then have had to find ways to save money each year since. This has meant that we continue to make money but the job is not what it was and we have moved from running a business to working in the business. That won't be forever though and that is what makes it worthwhile.

Be sure also that the invested money is not simply lost. If you are securing something such as stock then there is a little safety in resale value if things go badly.

There is a great deal of job satisfaction in being your own boss.

This means that whatever the time I would not hesitate to give it a go.

The things you learn about the business as you go along means that it does become significantly easier. If you need any more specific advice especially if contemplating hospitality sector feel free to contact me. Good luck.

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What he said, when going S/E or starting a business you're properly benchmarking yourself against reality. Recession is opportunity if you're better than the rest.

I wish I'd done it years before, working for other people sucks and PAYE taxation & NI just puts the boot in harder.

In think a recession is a good time. Fleet of foot while every one else without initiative is sitting around moaning.

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There's the "if you can make it work when times aren't great then you can make it work anytime" as already mentioned, plus how many businesses that don't survive recessions are essentially pointless gimmicks anyway, with the recession just weeding out the dead wood? If that theory is correct then if you've got a sound idea it should be fine.

Note that I've got no business experience whatsoever so may be talking drivel, but good luck (unless it's to do with building one of the very many things I hate of course!)

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Looking at this from a very high level - I would reckon starting a business at a time when things are a bit shitty makes more sense. If you can make it work then - the money should come rolling in once things get better.

sore of agree on this one, depending on the nature of your business

if it saves people time and/or money it will work.

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Or provides pleasure ;-)

that's not rally the sort of business I had in mind.

besides, when money gets short, they need to learn a few more party tricks to stay in business too I guess!!!

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What he said, when going S/E or starting a business you're properly benchmarking yourself against reality. Recession is opportunity if you're better than the rest.

I wish I'd done it years before, working for other people sucks and PAYE taxation & NI just puts the boot in harder.

I agree

Two views I hold about running a business especially.a start up micro 1. It's like a shark in the ocean do they worry about the weather. just swim harder, work harder and eat the lazy fish

2. Two Cowboys sitting around a fire. Suddenly they are startled by a bear, one guy says run, the other says what's the point he can out run us both. The first guy says I don't have to out run the bear just you

And finally someone in marketing said all business is just a knife fight in a phone box, you won't increase the market size but get in there and carve out your slice

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And finally someone in marketing said all business is just a knife fight in a phone box

I'm going to start that business.

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Whatever business it is see you have a healthy cash flow.....and make sure you have a hedge of many customers rather than two or three bigger ones......else your big customer could bring you down with them. ;)

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I agree

Two views I hold about running a business especially.a start up micro 1. It's like a shark in the ocean do they worry about the weather. just swim harder, work harder and eat the lazy fish

2. Two Cowboys sitting around a fire. Suddenly they are startled by a bear, one guy says run, the other says what's the point he can out run us both. The first guy says I don't have to out run the bear just you

And finally someone in marketing said all business is just a knife fight in a phone box, you won't increase the market size but get in there and carve out your slice

That brings back memories of my great aunt ,she always use to say when i was off out behave yourself and if you can`t do that make sure you can run faster than your mates

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I'm going to start that business.

hmm, interesting footnote on your post.

god probably is willing and able, but we're not entirely sure which sort of god he is.

not entirely sure he subscribes to nietzche's theories...which could be construed as creating problems to give you a bit of tough love

not entirely sure he is too keen on hippy happy clappy pussies either.

depends on which sections of book you derive your beliefs from.

strictly old testament means behave or I will beat you senseless until you've learned a bit of humility..or if you are hardcore disciplinarians I will do the same to the people you conquer....until you get soft and flabby...then I will give them a dose of the medicine you dished out on them to straighten you up a bit

new testament means help other people, turn the other cheek, and don't mind too much about people still using a twisted version on old testament hardcore bitchfest against you..just suck it up.

not entirely sure I agree with either interpretation...because there are people that take the piss that just deserve to be knocked out and humiliated in front of their homey's while they are giving it all the lip

no other message of reason will hit home..they have to be brought down low on the egotistical ladder in public view

doesn't mean just sit there and take all the abuse.

does mean that there is a limit to what will be tolerated, and once the line is crossed..hit hard,and make it count.

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My experience is that you need to have a driver to push the business forwards.

.

.

I think that there is never a bad time to start a good business. The key is to find a good business plan and execute it. Make sure you get a lot of miserable sceptics to review your plan and point out the disadvantages.

Interesting, thanks.

As others have said if you can make it work now ,it will only get better.

.

.

i found i would be constantly planning/thinking and found it very tiresome and unable to relax /totally switch off but also felt far more in control and secure

Yes, I am increasingly aware of the comfort (to some extent) that I would be giving up by going self-employed.v But the potential upside is significant if it works out.

As others have said, never a bad time to start a good business.

.

.

Try not to create a job rather than a business. Ideally, you want to be a business owner and have staff or computers do the work for you. Always be considering how you can be designing yourself out of the business and taking the profits. Otherwise, you have just created yourself a job with additional stress and responsibilities.

I think this is probably great advice, but inevitably we are going to be full time employees in the first instance. Good to think carefully about how that transition can be made over time though...

I know someone who was employed by a chap who was considering setting up a restaurant to sit outside the burrito shop in question, and count how many people went in over the course of a few days. To get a measure of footfall and demand before investing a ton in setting something up.

Yes. My background is research, so I will be collecting all the data I can to help me feel my way around this!

There's a saying that most of the people who become hyper successful in business have a least one bust before they find a formula that works, or get lucky for long enough to form a self sustaining business.

Yes, I know that saying too, and it's what scares me a little. I don't think I would bounce back too well from a failure (at least in terms of giving it another crack), so vitally important to get it right the first time.

Thanks for all the tips and encouragement.

Anyone know of any good books on this topic?

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