Should You Quit Your Job to Start a Business?

Should you quit your job to start a business? This is one of the most common dilemma faced by those who want to start a business. Once they've decided they want to be an entrepreneur, they don't know whether they should just quit their jobs or hang on until the business is on a more solid footing.

In my opinion, it depends on several factors:

1. How is your tolerance for risk? Some people love to take risks and live on the edge, while others are very risk averse. If taking risk is in your nature, you would love the challenges of starting and running your own business, and the ups and downs of entrepreneurship. However, if you are the type who is more prudent in decision making and only makes the move it appears that things will work out fine, then maybe staying in your job while jumpstarting the business is the best course of action to take.

2. What are your resources? If you have adequate capital to start and run a business - and keep it afloat for the next couple of years - then giving up a good job is ok As an employee, you are assured of getting a paycheck every 15 days or so. But as a self employed business owner, it may take months before you make your first sale. Worse, you may not make enough to pay the mortgage or rent and purchase groceries. If you have a family, you also need to consider whether your resources are enough to take care of them.

3. Do you have health insurance? Health insurance is another important consideration. As a self employed individual, getting affordable health insurance for yourself and family is not easy. In fact, health insurance is one of the common reasons would-be entrepreneurs are keeping their jobs before the business makes money. It is expensive to get health insurance, so make sure you can really afford buying one for yourself and your family when you decide to quit your job.

4. What about your family? If your business fail, will you have sufficient resources to feed, clothe and give whatever it is your family needs? If not, then having a job as a fall back position would be best.

5. What are the prospects of the business? Do you think there is a strong chance you will earn money from it - more than what a job could bring? Do you think you have the knowledge, resources, and technical skills to make the business succeed? It's just a matter of looking at the potential of the business, and deciding whether it is worth leaving the stability of a job and a regular paycheck. If you think your business will earn in two months what you earn in a year as a salaried employee, then chances are great that you'd do better if you quit your job and provide full-time attention to the business.

6. Can you handle the pressures of doing two things at the same time? If you decide to stay in your job while working on jumpstarting your business, this means that you will be doing both at the same time. This may mean that you work on your job from 9-to-5, then come home and stay up late until midnight doing tasks for your business. Or it may mean doing your job during the weekdays, and your business during the weekends -- which means gone are the days when your weekends are spent at the mall or hanging out with your buddies. Are you prepared for the long working hours ahead? Are you willing to give up your leisure hours? Can you handle the stress of doing both things? It's not going to be easy; especially if you have a family.

Some people are meant to be entrepreneurs and do not like to be boxed in by a corporate environment. If you are this type of person, you will find the risks of entrepreneurship to be so worth it.

Remember, you don't have to quit your job while you are still starting your business. Many people work on their jobs while trying to jumpstart their business, and leave it only when they have proven it to be a moneymaker and they have calculated that they would earn more by spending time on the business than on the job.

How to Start an Online Store

A reader sent in a question through our Consult Your Guides service asking us for advice on the best approach for starting an online store. Should he create his own website, or go open a store at eBay? With eBay's popularity on the Web, many small and home business owners face the question: why should they open a store when they can just go to eBay? In fact, this is one of the most common questions I see over at Yahoo Answers.

My stand is that this is a neither-nor situation: in fact you can do both. It will depend on your overall objectives, resources, and long term plans for your online business. Personally, I prefer doing both as your website can target your market differently while the ebay presence can be an additional sales channel. I made a list of the pros and cons of each approach to help the reader decide on the best course of action to take given his circumstances.

Read my response

Weird Patents: Why Didn't I think of That?

People sometimes think of crazy things -- that's a given. I'm sure you know someone who constantly cooks up loony ideas. The show "American Inventor" is full of these "what the heck were you thinking" ideas. But do you know that you can apply for a patent even for the craziest ideas?

Just look at the following patents granted by the US government; you'd think that someone at the US Patents and Trademark Office would use some common sense. But they didn't, and these "inventors" were awarded patents:

• System and method for providing reservations for airline restroom use (Patent # 6,329,919) which thankfully expired
• Pet display clothing described as "a vest or belt is integrally formed with tubular, pet receiving passageways which extend around the wearer's body and terminate in pocket-like chambers for feeding and retrieval." (Patent # 5,901,666) - Paris Hilton carrying her pets is cute, but I don't think I'd like to carry a hamster IN my clothes and crawling in my clothes
• Chewable toothbrush that works as follows: "the bristle anchor includes a cavity that holds a material such as toothpaste or mouthwash. When the toothbrush is chewed, the material is released from the cavity and onto the bristles." (Patent # 6,769,828) - so how can I get rid of the remnants of this toothbrush in my teeth when I have already eaten the toothbrush?

There are so many more interesting patents granted at the USPTO database. If you are trying to pass the time and you are bored with Web surfing, check the USPTO database for more "why didn't I think of that?" patents.

10 Things You Need to Know When Starting Your Own Home Business

You wake up one day and decide you want to become a business owner. Great! Welcome to the American dream of entrepreneurship. A growing number of people want to eschew the corporate life and become their own boss.

But the question is – how do you become an entrepreneur? What exactly do you need to start your own business? And succeed.

Deciding on becoming an entrepreneur is only the first step of a long journey. There are lots of planning involved, preparations, and in some cases, even red tape. Here are ten things you need to know when starting your own business:

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Book Expo America

I just attended the Book Expo America held in Washington DC, and it is definitely one of the biggest and busiest expos ever. Even taxi cabs in DC are wary of going over to the convention center because of the sheer number of attendees and the traffic it brings. But if you are in the book business, or would like to start a bookstore, this is definitely a MUST-ATTEND show.

I met with executives of Hatchett Books (formerly Time Warner Books), which has been a very generous partner to PowerHomeBiz.com giving us a steady supply of books to giveaway to our subscribers. The folks at Bloomberg Press thanked me for the review I did of their book "Steal These Ideas", and we discussed their forthcoming books that may appeal to our audience. It was also a great opportunity to chat with publicists of other book companies and hopefully start new business relationships with them.

Overall, the event was well worth the steep attendance fee. The only downside is that my shoulders are aching from carrying all the freebie books and bulky catalogs of the publishers.

How Do You Choose a Home Business?

You have made the decision to start a business from your home. But do you know how to proceed, much less what business to start?

Making the decision as to what you need to do in starting a business is the hardest first step. There’s just too many options, too many choices to make. Should you go for what you love and create a business out of your passion? What if you don’t love anything in particular?

There are four routes to take when choosing and starting your home business:

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Tips to Successful Cold Calling

Mention the word "cold calling" and people often get cold feet. Even for me, the prospect of calling up someone and pitching you to them something is too daunting of a task. It typically requires a lot of courage -- and a script that I've practiced several times.

Cold calling goes beyond phone calls; it also includes email or in-person visits. Email I do so much better because I don't have to talk to the person and find the right words to explain myself. Rejection also seems softer through email; not receiving a response is much better than hearing the words "NO" in your ears.

But cold calling is still one of the most effective ways to win deals and form partnerships that can push your business forward. Hotmail was created when former Apple engineer Sabeer Bhatia cold calls venture capitalist Steve Jurvetson about a free email platform. Same with Netscape when Jim Clarks sent an email to Marc Andreessen.

Business 2.0 magazine in an article entitled "Firing Up Your Cold Calls" has some very interesting and practical tips on how to improve your cold calling strategies:

1. Call when the screeners (secretaries, assistants) are out - the ideal time to talk to the decision maker and busy executives would be just after daybreak or after dinnertime. They would still be at work, but their assistants and minders would have already left. Yes, the timing is unconventional, but if it could put you on the phone with the person you need, then that's the thing to do.

2. Engage the gatekeeper. Because you can't always call before or after 9-to-5, chances are there will be times when the secretary or assistant will answer the phone. Charm them or disarm them with unexpected one liners. Make them think of you as a person not as a nuisance.

3. Find something - anything - in common with the person you are cold calling. Sometimes it takes a little digging to get the response you want from the company you want to do business with. An example given in the article is about a vendor trying to get in touch with the head of an asset management company. Since his calls or emails are not returned, what he did was to find other executives in the company with his same last name, and sent that person an email. Pretending to be a long lost cousin may not always work, but it sure can get you the exec's attention.

4. Buy before you sell. You have to first know the needs of the company you want to sell to, even to the extent of doing market research about that company. If you are able to zero in on what they need, and articulate it to them, you stand a greater chance in getting at the exec's door.

5. Be a little unprofessional. Even well-rehearsed scripts can sound, well, scripted. Your pitch may sound professional, but your calls are not returned or your emails deleted. The example given in the article showed the head of a nanotechnology company who have been calling the HR head at Kmart for the last 6 months, to no avail. Finally, he called and simply left the message, "Hey Dante, throw me a bone!" -- and got a call back within 5 hours! Unconventional sometimes work, I suppose.

6. Learn to love striking out. The word "NO" will not kill you. Don't be discouraged by it. You will always get a "no" somewhere somehow. But sooner someone will say "YES" so just keep prodding along until you improve your batting average.

I like the article because it gives a fresh dimension to what I often read about cold calling. Some of the tips are unconventional, but hey, whatever works, right?

Read the full article from Business 2.0

Effectiveness of Radio Advertising

While we haven't done any radio advertising, I always find myself taking note of some of the things I hear on radio ads. I have attended trade shows because I heard it on the radio, and watched concerts because of the radio ad. So I got curious as to how effective radio ads actually are in the real world.

I did some research and found a study on the effectiveness of radio ads. There is an organization called Radio Ad Effectiveness Lab that does an annual study looking at the response rates to radio ads.

Their latest study found that radio's ROI was 49% higher than television ads! They found that "radio moves products" and that "radio ads increase sales" even when national television is present.

You can read the full report here

Marketing Claims and Reality

One of the most effective tool in sales copy is the testimonial. Write in your ad copy how you made thousands, if not millions, using your product or technique -- and you can expect hordes of people joining your program, buying your ebook or getting your product.

But are these claims always real? How true are these claims?

Some I may say are real, with a few embellishments here and there. But others are downright laughable.

Take this person who wanted to advertise with us. His ad says "Learn how I am making $19,500 a month with Google Adsense." Pretty impressive, huh? He sent in his credit card payment, and what do you know, it was declined for insufficient funds! Now, if you are earning almost $20K a month, why can't you even afford to pay $150? I looked at his website, and there's no way that he is making that much money. He doesn't have traffic, he's got low paying keywords, even if his ads are a bit in-your-face.

My point is to take these claims with a grain of salt. Don't take them at face value. This seems like common sense, but believe me, many people are impressed with claims (however empty). They buy the products expecting the same result only to be sorely disappointed.

Marketing claims are designed to sell; not always to represent reality. Buyers beware.

Entrepreneur Success Story: Alison Leibeskind

We're featuring over at Women Home Business Alison Liebeskind, founder and creative force behind the fashion knitwear Alison Beth Company. Alison was able to successfully use her passion for textiles into a thriving business in a cut-throat industry, and her creations have been featured in numerous fashion spreads.

The article focused on how she started, from the time she was doing everything herself hand knitting all her products while running the day to day operations of the business to outsourcing production to other manufacturers.

We get a lot of questions on how to start a fashion business, and it is inspiring to read about someone who was able to actually start a successful business in the field.

Read the full story

Who is the Small Business Entrepreneur?

If you are trying to reach the small business market like us, Experian has commissioned a very interesting study called "The face of today’s small-business owner" shedding light on the characteristics of small business entrepreneurs.

Here are some findings of the study:

• Small-business owners possess a 21 percent higher income than the overall population. The average small business owner’s annual household income is $71,690, compared to a nationwide average of $59,378.
• They are slightly younger than the overall national average, and they’ve lived in those homes longer than the typical citizen.
• 42% more likely than the average American to be married, 25% more likely to have children, and 20% more likely to live in a family with a male head of the household present. Three-quarters of them own a high-value home worth $500,000 or more,
• Small-business owners have higher education levels across all education attainment categories, and are more likely to donate to causes than the overall population.
• 20% more likely than the general population to buy items via mail order, either for their businesses or for their personal use. They are 50% more likely than average to purchase goods or services from the categories of upscale [retail], do-it-yourself supplies, or news and financial categories.
• 54% of small-business owners are more receptive to email than the general population, with highest receptivity among services (a category that takes in medical, consultants, and ad agencies), finance, insurance and real estate business owners. Not surprisingly, those in farming, fishing and forestry were 24% less likely to be reachable by e-mail than the typical American.

Alas, the study is not free and costs $250 to purchase. But if you want a copy, you can order it from Experian

Top 10 Small Business Blogs

60 Second Ideas named this blog as one of the Top 10 Small Business Blogs for posting "solid down to earth advice for home business entrepreneurs. "

Thanks.

6 Hottest Businesses on the Web

The Web is moving towards a new direction. From simply being an information resource, the Internet is becoming a user-centric platform focused on the needs of users. As Newsweek in their recent cover said, this new phase is “Putting the ‘We’ in Web” (April 3, 2006 issue, pages 47-53) with the “Internet’s ability to empower citizens and enrich those who help with the empowerment.”

The Web is becoming deeply collaborative, allowing people to work simultaneously on the same tasks at the same time (example is project collaboration application such as BaseCamp). Many of the new success stories are riding on the powers of social networking (think the very popular MySpace.com); while others rely on user-driven content to create useful resources (great example is Wikipedia). The New Web has turned instant messaging into a crude application with the more powerful instant-voice-messaging and instant-video-messaging applications (Skype is a perfect example). It also allows for getting content here and there and mixing-and-matching them into unique content (Technorati puts together blogs and feeds in one easy to search site).

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