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4 Key Risks you ought to consider if you are starting a business
by Startacus Admin
Go for it! What have you got to lose? Well, potentially quite a lot! Not that this is a pessimistic outlook on starting a business, but here at Startacus we do like to give a fair overview of the possible benefits, disadvantages and risks in starting said business.
A good place to look to see the growing volume of startup / registered startup businesses in the UK is the Startup Britain Startup Tracker which is a good barometer of how many businesses are being set up each day in the UK.
But what of the ones that fail? What of the startups that don’t make it past the first year of trading? We’ve already highlighted some of the key reasons why starting a business might not be for you, but, that aside, what are some of the key risks that you might face, if you do develop that business idea and start trading?
Here are 4 key risks you might want to consider:
The obvious place to start when highlighting some of the ‘key risk of starting a business’ is the place it can hit a self starter the hardest - their pocket! When you work for ‘The Man’ you might have less creative input, but you will most probably have a healthy bank balance! The risk of not have a regular wage, can be for some of us, a massive aspect to consider, and depending on your financial outgoings (if and when you have a mortgage, a family and debts) may be too big a risk to consider at all.
Also, if you are a family man or lady and like the benefits that full-time employment can give - i.e. paid holidays / sick pay / pension schemes and so on, don’t expect to have all of these benefits in place when you start a business - these are potential luxuries that can come much later than your first trading year!
Following on from the personal financial security you may lose when starting a business, the financial pressure of not having enough (or any) cashflow is another rather large risk you will need to consider. Not being able to pay for your outgoings / costs / expenses and general operational costs may mean you go out of business, even before you have really even started.
Events outside of your control basically! No one can predict the global markets - well, that’s a lie, some can do it really rather well, but for the average startup / or self employed business person, predicting where the next pound or even latte comes from can be their biggest daily concern.
However there are world events - recessions, financial crashes / meltdowns / acts of God that can impact on your business startup and spell the end for it- a rather large risk one might say. The Lloyds of London News and Insight section is a good place to keep an eye on Global Events and Trends that might affect your business.
When you work for a large or even small company, the chances are that the core functionalities of that business are covered by the workforce themselves. When you start your own business, unless you have an endless pot of money to employ a load of specialist and qualified staff, you will most certainly need to multitask and cover many differing job responsibilities and roles - and all at one time.
Your own competency in doing this, and doing this well, can be a massive risk in determining whether your business will be a success or not. Failing to consider your own talents and weaknesses can be a massive risk to your business success - so think wisely and consider, if you don’t have all the skills and experiences, how will you cover each and every business base and startup skillset needed to make sure your business performs?
If you like what you see here on Startacus, why not become a member of our growing community? It's free! And you'll get all this - exclusive access to our Business Toolkit, discounts and offers galore for your business via our member only business deals, the chance to network and connect with loads of fellow self-starters, and maybe even become our celebrated 'Self-Starter of the Week' and tell the world your startup tale! Join right here for free