Registering as self-employed and running your own business can be extremely rewarding. However, being the captain of your own ship whilst losing the safety net of employment can be tough to balance. It comes about as a result of a conscious decision or a drift into it. In this blog we will share some thoughts based on our own and our clients experience.
Self-Employed – Overview
Becoming self-employed and running your own business is a major life change for most people. This change affects work/life balance; attitude/demeanor and social life, in addition to earning power and ambition. A great number of individuals are thinking of working for themselves, either by accident or design. For most this proves to be a life changing event and there are a number of highs and lows that come about due to this life change.
- Flexibility over working hours
- Greater variety of work
- Increased job satisfaction and work challenges
- Autonomy and independence
- Improved work/life balance
- Increased earning power
- No guarantee of work or income
- Greater degree of isolation and less human contact
- Increase in financial risks and exposure
- Increase in stress
- Heavier workloads
Becoming self-employed can be quite lonely and experiences are akin to that of a roller coaster ride. For example, busy work periods followed by quiet periods and feelings of optimism followed by ones of pessimism. Fortunately, these days there are a greater number of support agencies and forums that provide aid and assistance.
Finally, in my experience there are a number of common pitfalls faced during this transition period. It is useful to be aware of these in order to avoid them and to react accordingly.
- Mismatch between resources and expectations
- Difficulty in making the attitudinal and financial transition to “running the show”
- Poor market research
- Weak control and execution of operational, financial and strategic planning activities
- Poor credit control
- Product led and not customer led
- High level of operational and financial risk
- Over dependence on a single customer/supplier
- Lack of commercial formalities, e.g. basic contracts
- Inadequate working capital.
This list is by no means exhaustive or a judgement on anyone who has experienced the above.
In conclusion, there are many things to consider and be aware of when becoming self-employed. Most of all, it is important to understand that it is a major life change which will impact almost every aspect of your life. Consequently, with the right planning and execution, the rewards can be massive.
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Pro Active Resolutions – Your Business Friend
Get in touch if you’re thinking of becoming self-employed and running your own business to find out where we can support you.