Is Now a Good Time to Start a Small Business?
Have you ever had a dream of owning your own business and not having to work for a boss anymore? That is the dream of many employees who wish to have more control over their lives and their finances. With the unprecedented current level of employee layoffs, more people than ever are considering following that dream rather than trying to apply for a new job. Is now really the best time to do that?
Perhaps it’s time for a reality check. Starting a business is often considered to be one method of building wealth. The fact is, however, that 80% of small businesses fail in the first five years, and almost 80% of the ones that survive fail within ten years. Those that make it through the first decade have a solid financial and entrepreneurial foundation that is strong enough to see the business through the tough times. But what if you’re trying to start a business during tough times? It is possible and there is help available.
The federal government has recently unveiled a plan to get small businesses started and growing. They have allocated $730 million to increasing their funding to the Small Business Administration’s program to guarantee bank loans to small businesses. This should encourage banks to loan to small businesses and increase overall available financing.
Even though the money is there to borrow, starting a profitable business takes planning and patience. In the current economic downturn, consumer spending is down, especially on discretionary items. So, for example, now may not be the best time to start a taffy-making enterprise. There are some industries that are practically recession-proof however and these are great areas to build a business around. Basic services such as tax preparation, home repair, and hair cutting are some examples of things that people need to have done regardless of the economy. Basic goods are also always needed: groceries, baby care, and children’s clothing. Building a business around these foundations will give you a leg up in long term success.
Starting a small business in today’s economy is within the reach of many entrepreneurs who are willing to work and plan hard. The long term potential payoff is worth the effort.
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Tags: business opportunity, entrepreneur, making money, small business
This entry was posted on Wednesday, March 18, 2009 at 6:35 am and is filed under Career, Financial Goals, Investing Basics, Investing Strategies, Loans, Misc, Retirement Planning, Wealth Building. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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