With so many professional people being laid off in the past 18 – 24 months, and with so many of them having experienced difficulty finding new positions at similar titular levels and pay, many of these people are considering transitioning to small business ownership. Some are considering purchasing franchises, others are considering buying a small business in the area, still others are considering freelancing their skills. If you are one of these people, whichever you are considering, here is some helpful information.

First, working as an employee in corporate America, whether you were a vice president or administrative assistant, is vastly different than owning your own firm. I can’t stress this enough. If you are aware of the potential pitfalls, you can take steps to avoid them or minimize their impact. The biggest difference is that you may have been an excellent marketer or IT representative or HR manager, but that does not a business make. You can output excellent marketing materials and still have a horrible business. Why? You know how to do your functional area very well but you do not know how to run a business.

Second, when you work in corporate America, you have significant support that you take for granted. You have a marketing machine behind you so many businesses and individuals recognize your business’ name, you have an HR and payroll department that handles most of the recruitment and retention of employees (advertising, hiring, benefits, policies, etc.), you have an in-house mail department that sends out the mail and an IT department that fixes your locked-up computer or inability to access the server. When you start a small business, you generally have none of that. You need to mail something, get in your car and go to the post office. Your computer locked up? Go to your local Staples or Best Buy or similar or contact the Geek Squad unless you have a friend in IT. You get the point. All the back office operations you NEVER thought of…now you must
handle all of that personally…or hire or outsource it.

Third, you need to understand how to run a total business, not just a group or a department. Take a class at your local community college. There are a number of entrepreneurs who moonlight as class instructors who can help you expand your understanding. Also, check out your local library. There are many books on starting a business. Get a number of them and read until you can’t read anymore. Consider purchasing those that you find the most useful for your permanent library.

Another way to learn about starting up or buying then running a small business is Junior Achievement. Yes, Junior Achievement is targeted at middle and high school students. However, it has an absolutely excellent program called JA Fellows which is targeted exclusively at high school students. No, you can’t participate as a member, but you can participate as a Volunteer. You can still learn all the information and master all the steps as a Volunteer. The JA Fellows program is an in-depth program that has received numerous accolades. Sign up to volunteer for the 2011-2012 session. You will definitely appreciate it.

Author's Bio: 

Tiffany C. Wright is President of Toca Family Business Services, a strategic advisory firm that provides interim CEO, COO and CFO services. She is the author of Solving the Financial Equation: Financing Solutions for Small Businesses, available at Amazon.com, and HELP! I Need Money for My Business Now!, available at http://www.smallbusinessfinancingresource.com. In the last five years she has helped companies raise over $31 million. View her Small Business Finance Forum" blog.