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Special Notice: The audience I'm addressing is solo entrepreneur and micro business start-ups on a shoestring, where no significant start up money required. Most readers who are interested in this material will be those who are unemployed or underemployed and are going into business for themselves because it's one of the few options left for making a living or making extra cash. This material is not directed toward anyone who is expecting to risk large amounts of money, take out loans or invest in a franchise. For that, there is a large body of literature and a large number of advisers available to help you acquire the knowledge you need before starting up.

Basic Business Start-Up Abilities
by C.S. Clarke, Ph.D.

Despite the large number of entrepreneurial management abilities outlined in books and articles for newbies, you don't need a lot to get started and you can acquire anything else along the way. In fact, most people who start up one-person businesses simply leap into it out of inspiration or desperation. I'm hoping to insert a little sense and a few basics to help you avoid the major pitfalls and find the minimum you need to know and do to get started safely and grow with experience.

The lists of abilities most business start-up books advise are extensive and many are more like wish lists items than bedrock necessities. Almost no one who starts a business actually has all those skills at the beginning, but rather gradually adds them as they get experience and grow. Indeed, few people have the upfront time, patience, knowledge or experience to make an extensive business plan.

For example, the guy who starts making some cash doing yard cleanup simply has to have his know-how, a lawn mower and other basic equipment, proper clothing and protective gear and a willing homeowner who hires him. Later, he can get business cards, helpers, a truck and management skills to run his helpers better.

Of course, there are some basic requirements:

You must have something to offer -- a skill (service) or product.

1. There must be a market for it. That is, there must be people who want to hire you to apply your skill for them or who want to buy a product that you make or can get for them.

2. It doesn't have to be a big market. You just need to be able to get enough people who buy what you offer that you can make enough money to live on. If the market is too small to make enough money to live on, you can just use your business for extra cash while employed, or you can start more than one business that allows you to cumulatively make enough.

Furthermore, you can create a market. For example, as the story is told on Famous Amos® cookie packages, the Amos of fame originally made his cookies at home and presented them as gifts and calling cards. They became so popular that he was able to create a money-making enterprise with them. It wasn't his original intention, but it worked out that way.

3. You must be able to contact that market and present to it well enough to get sales. You may not need to become a salesperson, but you have to be able to let people know about your service or product in some way that will interest them in buying.

You must comply with the law

1. You need to research the requirements for doing business in your city and state -- most businesses require licenses or permits, and if you use a name other than your own personal name, you must publish a DBA in the local newspapers.

2. If you are going to work in your home be sure that it is allowed by government, homeowners' associations, the rental agreement you have with your landlord and/or the covenants that run with the land if you own your home.

3. If you are going to work completely on line, there may be no permits or licenses required, but there are general laws both statewide and nationwide that still apply -- you still will go to jail for fraud and stealing, and if you are earning an income, you still have to pay taxes, not to mention that if you sell something on line and deliver it in your state you have to pay sales tax on it (which of course you can collect from your customer.)

You must know how to manage your money

1. At the very least you need a checking account and the know-how to balance your checkbook. You may think that goes without saying, but there are amazing numbers of people who don't ever balance their checkbooks, live on credit cards and have no idea how to budget.

2. If you are a financial incompetent and you still insist on jumping in to your own start-up, you must find someone you can absolutely trust to help you manage your money while you learn.

3. If you do have someone helping you with money management, you must learn the basics for yourself. Otherwise you cannot make essential decisions about pricing, expenses and cash flow. The good news is that the math and processes involved are very, very easy. I learned them when I was 12 years old. From my grandmother, who finished her schooling at the third grade and could barely read and write. (Not kidding.)

There are many resources on the internet and in books that can help you with the all the above basics in starting up a business, but a list of such is way beyond the scope of this article. Nevertheless, I'd like to give you one link now to help you get started with the money management section: Ohio State University ( has an excellent personal money management course (completely free) for those who need a review.

Personal finances is the right place to start for solo entrepreneurs and micro-business people, because your tiny business is part of your personal finances. Also, whatever kind of business you eventually develop, your financial success in business is inextricably tied to your abilities to manage your own money. Taking care of yourself financially is about making money, using money effectively and keeping money for long-term use. That's also what business is all about.



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