GUEST POST (poss.ca): How to start your own business

This article was originally posted on Poss.ca, an initiative of Findhelp Information Services.

    is an Employment Ontario project, funded in part by the Government of Canada.

Image: State Archives of North Carolina via Flickr

For many it starts with a lemonade stand. That first (not sour) taste of what it’s like to be your own boss! So intoxicating. But even with a lemonade stand, the entrepreneurial beginnings can be challenging — your lemonade tastes bad, your poster sucks, the weather doesn’t co-operate, there aren’t enough people passing your stand. It’s the same for grown-ups, actually. In order to make your business work, you really have to be diligent about the plan, you have to be knowledgeable about the market, you need to have your finances worked out and you’ve got to spread the word. No winging it in the business of small business. Here are seven steps to making it work.

Market research Market research is a key component of your business strategy and should be the first step in developing a new product or service. This is your opportunity to check out the competition and find out what’s already out there. It can also help you to determine how your business could offer something better or different — part of the research might involve identifying service or product gaps that need to be filled. Based on your research you will also be able to establish pricing.

Please note that even though you might have your heart set on a particular business idea, you may find there isn’t a current demand for what you’d like to do. This will make it harder to get funding and to make a profit. (For some examples of how a business idea can fail, watch a few episodes of CBC’s Dragon’s Den!) Sometimes this means your dream business will have to wait or you will have to start out on a small scale. Or it may just require a little creativity to figure out how to make your product or service unique.

The federal government’s Canada Business Network site thoroughly describes market research and provides useful tools for conducting it. Often, something simple like doing an online survey (via social media, for instance) can give you an idea of what people want and if your business would be able to meet that want.

What’s the (business) plan? Once you’ve determined that there is a market, you will need to start shaping your idea into a concrete business plan to show funders. This means more than just having a catchy name and a fancy logo (although, branding your business is absolutely crucial).

Funders will expect your plan to answer many questions including:

• What is the demand for your product or service?
• What are the start-up costs?
• How many staff members will you need, if any?
• What are the overhead/production costs?
• How long will it take to start recouping your initial investment?
• What are your projected profits?
• What happens if the market changes?
• Do you have any plans to expand your business?

The Canada Business and the Business Development Bank of Canada sites explain how to create business plans and offer online templates. Additionally, the Canadian Bankers Association and the major Canadian banks all have useful tools to help you decide what type of business to start, where to get financing and how to put together a business plan.

Making a strong business plan is essential to any successful business, whether it involves starting a fruit stand, doing freelance accounting or teaching accordion classes. (Check out some examples of business plans.) You can even consider taking business management courses — schools such as Ryerson, Humber or Rotman offer full-time degrees in business, but you can also get a small business certificate via Centennial College). If you don’t have the desire to manage the business yourself, find a reputable accountant or advisor to ensure your financial affairs are in good order. Being aware of your money is just good business sense and not something that is in conflict with creativity.

Also do check out places and sites such as MaRS, Lean Coffee Toronto, Sprouter or Team Biz to get free peer support, get referrals to services and ask for advice and get all kinds of tips about being an entrepreneur. Finally, don’t forget about the Enterprise Toronto site that’s chock full of resources including small business events, notices about workshops, seminars, events, and much more.

Start small Before you blow your savings on the best glass beads, a walk-in freezer or a storefront on a swanky street, remember that many successful business owners started out with just a few basic materials, using their basements, kitchens or garages as their headquarters. (Dufflet Rosenberg of Dufflet pastries began baking from her home in 1975. She opened her first pastry shop in 1982. Today, “Dufflet Pastries supplies more than 500 restaurants and cafés, specialty food shops, upscale supermarkets, hotels and caterers with more than 100 unique, entirely natural products.”) If you have a clear mental picture of what you want to achieve, you may think it’s fine to skip a few steps and fast-track your business expansion. However, a wise entrepreneur knows that success takes time. (LinkedIn has an interesting forum discussion on how long it takes to get a business off the ground). Don’t overextend yourself financially or by promising larger orders or longer hours than you can keep.

Spread the word As an entrepreneur, you need to be ready to sell yourself and your new enterprise. Mention your business to your friend’s relatives, that guy you met on the bus, and pretty much anyone you lay your eyes on. Set up a Facebook fan page. A Twitter account. And post like there’s no tomorrow — you need to take an active part in promoting your business. Check out this Canada’s Business Network article on advertising for some great tips. And we highly recommend the poss.ca article on branding for more insight on how to spread the word.

Network Once your business is established, developing a community network can also help boost your reputation. Forge relationships with other establishments on the street or with businesses related to your industry. For example, if you’ve just started a carpentry business and are meeting other tradespeople (plumbers, electricians, etc.) on work sites, get chummy with them. Pass out your business cards and keep in touch. If they like your work, there’s a good chance they’ll refer you in the future.

Find out about mentoring opportunities and look into associations, such as business improvement associations (BIAs) or sector councils in your field. Have a question about taxes? Ask your accountant cousin out for lunch. In our article on networking we offer great advice on how to network to get a job — feel free to apply similar strategies to let people know about your small business.

You’ve got to have a website. Period. It seems redundant to tell you how important a website is for your business. After all, you’re reading this online so you must be already indoctrinated into the world of the Internet. “To the eyes of a consumer, having a quality, professionally designed website is a measure of how successful your business is and how likely you are to remain in business. Small businesses without a website seem ephemeral — fleeting,” says this article on the importance of a website for small business. There are more reasons than that, of course, but the main one is that many people simply expect it.

You can either pay a professional to create a website for you or set up one on your own. Basic website creation is actually not that hard; it just takes a little patience. Creating your own website will entail purchasing a domain name (such as [name of your business].ca), finding a website hosting service, and then using a publishing platform to create your pages. There are many website publishing platforms available, such as WordPress, Blogger, TypePad and Movable Type, some of which incorporate hosting and publishing services all in one. One of the easiest and best-looking sites you can build for free is via wix.com.

If you’re still daunted by the idea of creating your own website, you can always sign up for a course in website development. Seneca College offers evening and weekend workshops, and the Toronto District School Board has classes on website design grouped by difficulty level. Additionally, the University of Toronto’s School of Continuing Studies offers a Strategies for a Web Presence course, which could be handy once you’ve got your website up and running.

How would you like to pay for that? Funding options for entrepreneurs It’s expensive to start up a business (especially one that runs out of a storefront, but even online businesses require start-up money). Most people don’t have thousands of dollars lying around, so external financial assistance is usually required. This can take the form of a bank loan, money from family and friends, outside silent partners or even angel investors.

The Industry Canada website is a good place to start researching funding sources. The Canada Business site also has a great financing resource list for specific demographic groups. Private sector financing is another option to investigate. Check out Canadian Youth Business Foundation for more resources.

Related links:

Starting a business in Ontario

Steps to starting a business in Canada

Canada Revenue Agency: New businesses

Inc. magazine: How to start a business

Making a successful career change: Q&A with recent career changer, Kim Phelan

Tired of your daily routine, disgruntled with your job? Thinking about a career change? Being a “career changer” myself I am always interested in hearing other’s stories about why the left their occupation, how they found their passion, managed their transition and what advice they may have for others considering a change. I recently had the opportunity to interview Kim Phelan, owner of Down to Earth Décor (interior decorating) about her recent career change.

Q:  Kim, tell me a bit about your background and what you were doing before your career change
A:  I have a degree in Psychology with a Minor in Economics and I took a Post-graduate Diploma in Business. I’ve always wanted to be in business, so I focused my job searching in that area once I graduated.  I started my career in Marketing at a Software Company. I managed trade shows, marketing collateral, sales support etc. After a while I became very involved with the software product itself. I did competitive research, product marketing and over time became a product manager & a director of product management. A product manager is basically a “CEO” of a product — they figure out what customers want, what to build and make sure it all happens.

Q:  What motivated you to change careers, and why did you move from marketing to interior decorating? 
A:  After 15 years in marketing and product management, I found that I was no longer challenged. There were no problems I hadn’t encountered in some way before and it wasn’t very motivating.  What I did find motivating was my home projects, home decor and different refinishing projects. I like using my hands, and seeing my vision come to reality. So when my last job ended, I reflected (with the help of my partner) on what I actually loved to do; software didn’t make the list but interior decorating did.

Q:Did the change require going back to school? How did you manage the transition and how did you know that this occupation would be suited to you?
A: To become an Interior Decorator, I needed to go back to school.  I researched my options for length of program, the qualifications I’d have when I graduated and the reputations of the schools. In the end, I decided to take a diploma in Interior Decorating from George Brown. Because I wanted to do residential design only, I didn’t need to become an Interior Designer; a Decorator was enough. I decided to do the part-time program in a full-time manner, so I was done the program in 10 months compared to the 3 years part-time it usually takes. I knew that the program was for me because of what I did in my spare time: I loved tracking style trends, and doing home renovation projects. When I reviewed the Diploma curriculum, I was very excited by each course that was listed. I knew that this was the path for me. It allowed me to capitalize on my past experience running a business, marketing and managing technical people, while still allowing me to be creative. Creativity was something that I had relegated to my home life, not my work life up until that point; the ability to combine the two seemed  too good to be true.

Q: Did you do information interviews beforehand, have mentors or have some kind of exposure to the world of interior decorating?
A: I read a lot of information about the industry and how the jobs worked, from blogs and other publications. I spoke to some seasoned Interior Designers about my plans and incorporated their advice. I also spoke to potential customers. As a Product Manager, my old job was to understand what the customer needed and what problems they had, so I used that skill in a new area.  By interviewing people who I knew I was able to understand the type of business that I wanted to run and how I could become successful.

Q:  What advice can you give to a potential entrepreneur interested in building a business?
A: Understand what you will offer, what makes you different.  Talk to the people you think would be your ideal client.  Understand the problems they want solved. If you can position yourself in a way that speaks to the pains your customer has, that’s half the battle.

Q:What challenges did you face (ie: loss of income/financial, back to school stress/anxiety, loss of former identity?) and how did you manage?
A: I definitely had a loss of income, but I was able to overcome that with a supportive partner and funding from Employment Insurance for retraining. Because I had been an expert in my former career, I often had to battle the idea that I don’t know it all yet.  Although that seems logical, after years of knowing what to do in most situations, most of my stress comes from not knowing the answer and having to figure it out on the fly. Because I am a home based business I was able to avoid much of the upfront costs that a lot of companies have. I decided I wanted to keep my costs low initially to reduce my stress level.

Q:  What advice would you give to someone considering a career change?
A: You are only limited by your imagination. By sitting down and figuring out what you love, you may discover a totally new career for yourself.

Q: How do you define success?
A: I define success in a few ways:
The first is happiness: Am I happy every day? Do I feel inspired by what I do?
The second is reputation: Are my clients happy? do they give me referrals? am I running a business that is fair and ethical?
The third is monetary: Am I running a business that is making money? Am I running it effectively? This doesn’t mean being a millionaire, but it does mean having enough.
So for me success is running a business that makes me happy, allows me to sleep at night and provides me with a comfortable living.

Kim, many thanks for the interview! Kim’s website is Down to Earth Décor

 

If you are thinking of making a career change, but not sure about your direction, start with some self exploration. Brainstorm possible options with friends, family and Career/Employment Counsellors, and target fields of interest with in-depth research.  Labour market analysis, information interviews, job shadowing, networking, connecting with associations should all be part of your information gathering (have a look at our blog post on this topic).  Kim assessed why she was unhappy and took time to discover what motivated her.  She spoke to seasoned professionals in the field (and potential clients) in order to gain valuable advice about her career change and that along with researching, returning to school and her background in business all laid the path for a successful career change.

You can assess your interests, values and skills through the exercises in the book What Color is Your Parachute by Richard Nelson Bolles (10 Speed Press)

Other recommended books include:

• I Don’t know What I Want But I Know It’s Not This: A Set By Step Guide to Finding Gratifying Work by Julie Jansen (Penguin Books, 2003)
• I Want Something Else, But I’m Not Sure What It Is by Ron and Caryn Krannich (Impact Publications, 2005)
• 12 Steps to a New Career: What to Do When You Want to Make a Change Now! By Carl J. Wellenstein (Career Press, 2009)
• How to Start a Home-Based Business by Bert Holtje and Susan Shelly (Morris Book Publishing 2010)
• 50 Best Jobs for Your Personality by Michael Farr and Laurence Shatkin (Jist Publishing, 2005)

 

At JVS Toronto we offer services to assist individuals to explore careers:

• Career Exploration Workshops at our Employment Source Centres
• In depth one-on-one  Career Counselling services

Interview with an Entrepreneur

I recently had the opportunity to talk to Michelle Ward, a friend and person I greatly admire for her energy and entrepreneurial spirit.

Michelle has started her own line of clothing called Addaboy which she refers to as “modern clothing for little rockers”. The inspiration for launching Addaboy came to her after her son, Kale, saw an old music video (new wave) and asked her if he could have some clothing that looked like the stuff he had just seen. After about a week of searching and coming up empty-handed, Michelle was stumped and very excited. Kale had inadvertently ignited a new business idea that would become Addaboy.

This is what I truly admire about Michelle because her passions seem to spark ideas for her businesses. Michelle has a passion for music and spent much of her late teens and early 20′s enjoying Toronto’s punk/new wave scenes.

This isn’t her first foray into starting up her own business; Michelle was also the person behind Fly Gurlz, the first women’s mountain biking community in Canada. Her love of biking and the lack of any women’s teams or women specific mountain bike training was the impetus for dreaming up and starting the program.

Kate:
So Michelle, how many days do you work per week?

Michelle:
We have two small children so life is a complete juggling act. I work 4 full days a week and then log in hours at night once the kids are in bed. I tend to do graphic design, web and computer-type work at night and deal with the manufacturing/sales side of Addaboy during the day. We bought a huge wipe off calendar for our kitchen and it never ceases to amaze me at how chock-full it looks at the end of the month!

Kate:
Many people think of ideas for a company or product but never really follow through. Do you consider yourself courageous? And how do you deal with the risk involved?

Michelle:
I think any person tackling something new is courageous and risk taking is generally about doing something that extends you out of your personal comfort zone! This is one of the main things I miss about running the Fly Gurlz. Women would be trying something they had never done before and at the end of the ride, lesson or race they would be on fire with enthusiasm – I fed off this vibe – it was incredible! Then this new-found self-confidence would have a ripple effect throughout their personal and business lives. They took a risk and gained rewards for facing it. This is the way I approach my entrepreneurial life. You have to go all in and experience the good with the bad. There is risk and it can be very daunting and scary at times but because of what I learned from Fly Gurlz, I know that I will come out the other side stronger, tougher and more knowledgeable than before I started. I am surrounded by an amazing family and lean on them often for support and encouragement. I think communication is the key to managing the stress of going out on your own and taking the risks involved with building a business. I am a long distance runner now as well and this seems to really help me stay focused and work out the bugs that tend to creep into your head when you are struggling to build a dream. Passion will get you through the tougher times as well – it is the lifeblood of any small business.

Kate:
When you started building your two ventures (Fly Gurlz and Addaboy) did you have mentors who provided help and advice? If so who were they and what did they teach you?

Michelle:
There were no blueprints available for Fly Gurlz when I started and because of that it was a very tough go. We were trail blazers and as a result I didn’t have any business model mentors to look to for advice. We were the first affiliated all-women’s club in Canada, the first North American all-female mountain bike trade team and the first event organizer to host a women’s only mountain bike race. So initially the community had to rely on itself and ironically this is what created such a strong foundation. As the program developed so did the amazing creative pool of women involved. So I can’t name one person over another, except to say that Fly Gurlz was always a team effort grown out of a mutual love for the sport of cycling!

With Addaboy things are different as there are many designers working in Canada who have already laid an incredible foundation for companies like mine to follow. Sara Filmore at Planet Kid in Toronto is most certainly my mentor for this business and she has been such a terrific help. She has taught me so much that I could fill a page with her wisdom! Suffice to say that I feel so very blessed for knowing and having her in my life.

Kate:
What advice can you give to a potential entrepreneur interested in building a business?

Michelle:
Do it right from the start. All those little things like name searches, registering your business, insurance and looking into the legal obligations of the kind of service/product you wish to bring to the marketplace. I believe it’s worth the investment to hire a lawyer to help you out with incorporation and the like. You also have to have a working business plan. A great book that was recommended to me by one of my mentors is the “E-Myth” by Michael Gerber. I think it’s a must read for any person who wants to improve their small business or launch one.

Other key advice I would give is that there is always a pay-off for hard work and in North America I think we often equate this reward as monetary. I have found over the years that money is often the last pay-off after many intangibles ones have been offered up. You need to keep your expectations in check and don’t get bogged down by negative tapes that can start playing as you struggle to launch your business. It’s normal and natural to experience many highs and lows as you travel down the entrepreneurial path. I remember around year 5 with Fly Gurlz another organization got a huge cash sponsorship. I was still slugging it out – working for 9 bucks an hour to help pay for insurance, team kits etc. That tape started in my head, “Why did they get that money? I should be making a living by now! ” Well, really, who said I should? By allowing those emotions in I became very angry, bitter and resentful and nobody wants to be around a person like that. Keep your expectations in check and realize that the early pay-offs will most often come in the most subtle and quiet ways. If you are in the land of anger they will go right over your head and you won’t see them. These small pay-offs are the very thing that you will need to keep going and persevere through the early hard times of building a business! Celebrate & rejoice in every small achievement and by all means – toot your own horn because nobody else is gonna do it for you!

Kate:
How do you define success?

Michelle:
Success for me would be defined as living a positive and upbeat life and never taking my health, family or passion for being on this planet for granted!

Kate:
Michelle, many thanks for sharing your views and advice on being an entrepreneur!

For further information on starting up your own small business, RBC Royal Bank has a good section on their website, and if you google the words “entrepreneur” and “test” you’ll find many online quizzes which will help you determine if you may have what it takes to launch your own business venture.