Small, singular, personal - consulting businesses - how to start your own. Clue me?

[Sparky Kronkite]

Even though now out of work, laid off after 15 years with the same folks - and searching for regular, salaried positions.....

I thought that for the very least - tax right offs - I'd start my own consulting business. But I know nothing about it.

I've been asking around and have gotten some good info - but thought I'd ask you all about your experience.....

Remember that I will now reside in Northern Virginia area and I don't want this to be real fancy or difficult. And of course it should not be expensive.

But I like to keep in legal in this state, have a business card, an informational/PR 3 fold color-pamphlet, a home office - and maybe even a very simple website.

So let's have it - what do you guys know? Laurel?

The basics please.

 

[Ezzy]

As a spam eater...

You could either comment on the internet or become a food critic.




EZ

 

[Jean Val Jean]

Step one: Stay in your present field.

Step two: Go after clients of your former employer.

Step three: Sell your business to your former employer's competitors.

Invest the proceeds in real estate.

 

[miles]

Be careful with #2 if you have a non-compete.

Plan on doing LOTS of self-promotion, industry networking, and plain old shmoozing.

Plan on going without any income until you get established. It always takes longer than you originally thought. Once you are established, you will still have periods without income. Also be prepared for some slow-paying clients. Make sure you have a good attorney who can provide you with wriggle-free contracts. You will also need a good CPA who can help you with tax writeoffs (which are minimal) and manage your income. You will have to pay your own state, federal, SS tax, medicare tax quarterly (LOADS of fun writing that check). You will also now be the beneficiary of a "self-employment tax" the feds slap you with for having the chutzpah to be an entrepeneur. Oh, and you also pay double social security tax becuase you are an employee AND an employer.

That's the good news.

Seriously, if you have the right skills in the right time/place, you can do very well. Two other things to consider: if you were laid off, there may not be much demand for your skills. BUT....when companies find out they laid off too many people, which will happen soon, you could be in a very good place.

Going into business is a risk - you just have to weigh the factors.

 

[Cheyenne]

You need a written business plan.

"I want the tax writeoffs" isn't a good enough reason to start a business.

 

[p_p_man]

As Cheyenne said: A Business Plan.

But a Business Plan is not just pages of figures for you to show your bank. It's also a plan for yourself.

Q. Why do you want to enter the business world?

A. To say because you have been laid off is no answer to yourself. Think deeply exactly why you want to start a business. Is it to be short term until you can find a salaried position again or long term (ie for life)?

Q. What do you want initially out of the enterprise?

A. Again think deeply about your short term and long term targets. If the answer is just to get a salary to live on then the permanent world of business is not for you. Perhaps a casual enterprise would be more appropriate. In the beginning you probably won't make enough to live on anyway and so your targets must be far more reaching.

Q. What is your ultimate aim?

A. At the end of the day when you want to retire what is the ultimate you want to achieve. Again money and financial security is not the answer. If you're successful they will come anyway.

Q. Are you fit both physically and mentally?

A. Don't take how you feel at the moment as a yardstick. Have a complete physical. Running a business can be debillitating in terms of health. When things go wrong will you be able to cope with the pressure? It's better to find out now how fit you are than later on when you will need all your strength.

Q. Who are your competitors? And what do you want to do about them?

A. Are you content to exist in peaceful co-existence or do you want to be top dog. I know you are saying that you want to keep it simple, but business is not like that. Once you become known you must assume other businesses in a similar field don't want you around.

It's possible of course to have business rivals that are happy to let you get on with it (and that's a moot point in itself. What do you do if these "friendly rivals" start poaching business from your area of expertise, or your geographic area? A dollar in their pocket is a dollar out of yours).


Take your time to write a Business Plan. A more appropriate title for these documents is Battle Plan. They are meant to cover everything you can think of about the business you want to start. The financial part is only one section of many. And that's usually the easiest.

If there are any organisations in your area that give free advice (these are usually Government or State run) join them. Initially get everything you can for free. Even advertising can be free if you use the Free Press or come to deals with clients who might have a financial interest in the media. A printer will often give his services to you in return for your services to him; if by some stroke of good fortune you know someone with influence in your local radio station, maybe you can both come to an "arrangement".

All things are possible just look around.

A cautionary note: don't let too many people know what you're doing, not until you've started anyway.

Richard Branson, founder of Virgin Records, Virgin Airlines, Virgin Trains (UK) etc has been in business since he was sixteen. He was owner of a successful teen magazine giving advice on contraception to young girls. He also ran a few clinics. He was televised even at that young age.

Anyway his first business plan read something like this:

1. Start record company.
2. Start an airline.
3. Start an insurance company.

He's achieved all three. Plus others that just 'happened' along the way.

Best of luck...

 

[Cheyenne]

Never thought I'd say this about a p_p_man post, but yeah, what he said!

You got the short 1 a.m. answer from me about needing the business plan. I meant what p_p_man said, though.