To leave a 'perfectly good job' to set up a new business doing something I don't know how to do

[OhForFrigSake]

Ok, I have a pretty well paid job that I hate and that is fairly likely either to disappear soon or completely change (work for local council who now have about 50p to run all services).

So.. I have had the idea to use my meagre voluntary redundancy pay, my savings and some funding from a local business support enterprise (funding has already been approved!!) to set up a business that I think I'll love?

The business is semi permanent makeup which I don't know how to do but I have found a training course locally and I think it's be right up my street. I have also done quite a lot of wedding and event makeup (paid) in the past as a sideline to my 'everyday' job so I see it as a sensible(ish) extension of that.

I am quite business minded and have spotted a niche (no one is offering this in my area) and a market and am confident I could make it work and that it could be very profitable although I know it will be hard slog.

I just don't know whether it's a stupid thing to attempt? I have two toddlers and have never run a business before. I know my PILs think I am absolutely bonkers for doing something they think is a total gamble and that I should just be grateful to have a job even though I dislike it. AIBU to think that if I put together a good business plan (I have), do the training, and work like a Trojan that I can make this crazy thing work. People do, don't they?

Sorry for typos, toddler jumping on me!

Can you not do it part time or at least wait until you have qualified before you leave your job?

I will be doing my training whilst I'm still working but as I need a premises to work from I will need to be there and earning from the off. Also, my redundancy is funding this grand plan so no option to 'wait and see' really.

Difficult one.

I'm an accountant and it's made me very jaded about small business start ups. Very few succeed. Most people who start one, regret it, in my experience and either choose to give up, or are forced to give up.

The ones that are most likely to succeed have
solid business plan
sufficient funds to not need an income from the business for the first year or so (taking an income when possible is different from needing that income to pay the basic bills)
experience in business/commercial world - senior manager, accounts, business development etc if it's anything more than a very small one man band no skills required type thing with low overheads.

You could do well.
You might not.

Things to consider
What will you do when you are sick and can't work? For one day. For 3 months. How will your business operate?
Have you costed absolutely everything out - realistic start up income, realistic expenses and costs allowing for increases
Will you be employing staff? If not, how will you deal with phone calls etc to book appointments if you are in the middle of a treatment?

I'm Debbie Downer because so many people think running a business will be fun, and it'll be great not to have a boss breathing down their necks. The reality is about as far from fun as you can get. Worrying about paying bills, long working hours, turning something that is a fun hobby/interest into 9-5 grind and losing any enjoyment in it.

I don't see why you need your own premises to train in?

and have spotted a niche (no one is offering this in my area)

Have you done market research? Is there a reason why no-one is offering this in your area?

If your job is going to go anyway then the only thing you have to lose is your redundancy and savings as your income and job security will have already gone. I suppose you need to look at whether you can afford this loss as well?

Also as kentish asks, would you need to employ someone or have cover for when you're sick or on holiday?

Kentish - you make a good point. I know the stats on the number of new start ups that make it make for depressing reading but I also know some DO make it. I also realise it's going to be bloody hard, stressful, relentless work but I am ready and prepared for that. I also don't expect to be making money for a long time and we can live (albeit very basically) on DHs wage.

The reason I think no one is doing this locally is because customers are going to the nearest city for it. That said, I live in a pretty big place and, from the market research I have done, I know there should be demand for it.

Perhaps I am bonkers? I just know that I will regret it if I don't do it. I think it would be harder to deal with than doing it, and failing.

Mrs W, I don't need my own premises to train but the training is expensive so once I've completed it, ideally I want to start working straight away so I can start recouping my costs. I can't work on a mobile basis so will need a premises to trade from.

I think in the circumstances you describe, yes it is possible. I left a well paid permanent job to set up my own business and never looked back (10 years ago). My parents and PIL and other family had only ever worked in paid employment and could only see the risk of what I was doing, not the opportunity (and I understand why they saw job security as the be all and end all).

However, I think I managed to make a success of what I was doing because:

• I kept all my overheads low (e.g. rent a weekly space in someone else's premises rather than commit to a year long lease of your own), minimise all your commitments
• I retained as much of the profit as I could in the business to fund me if my business turned out to be a short-term flash-in-the-pan
• I made sure I developed the skills to work ON my business as well as IN my business (so as well as training in the make up tuff, you need to develop skills in marketing, and bookkeeping, and tax, and law, and legislation, and customer service - or else pay someone else to do them)
• I devoted time to marketing etc, and saw it as much a part of my job as 'doing the work'.
• being meticulous about monitoring your business plan (and adapting it as required), and knowing when to cut your losses on something.

Also, be clear about what is the worst that could happen? Spend your redundancy money? OK get another job. Spend all your savings? Ok get a job and save hard to rebuild them (so you can try again in the future ). Get a loan? Hmm, be very wary - you don't want to spend the rest of your life paying back a loan on a pipe dream....

Good luck!

Re: sickness, I can't afford to train a second person to work for me (for now) but I have worked my cash flow forecast out on a 46 week basis, giving a 6 week 'non working' period. Obviously, if I get sick, I'm not working, and if I'm not working, I'm not earning - I will have to reschedule any appointments I miss.

Being a one-woman-band, I am investing in some good online appointment booking software so that customers can book, alter and amend their appointments online (or via text) so I don't have to keep dropping everything to keep answering the phone!

Thanks Venus - great to hear from someone who has made it work.

Totally agree with what you say regarding developing other skills - particularly with regard to marketing, especially as I am essentially beginning from a 'standing start' with no client list. Luckily I have done a fair bit of this as part of my current role, but it will be a massive part of my business along side the treatments.

I think I'm just struggling because I want to go into this 100% but am finding others (probably entirely justified) skepticism hard to deal with.

Btw what do you do Venus (if you don't mind me asking) and have you managed to build your business up or are you still pretty small?

I work in Accountancy and I was also going to ask what market research you have done. That is important, to find out if people would use the service if it were available, how often they would use it, what would they spend etc etc. Semi permanet - so how long does it last, when would they come back again, would they do it all the time, or only for special occasions. So that you can see if you would have a regular income out of it. Can you do more training and expand your services? I have a client who started out doing basic waxing, then trained for more intimate waxing, facials, fake tans, manicures, makeup, hair and so on. So that she can offer a wide variety of services and always be in work.

I don't see that you need to employ somebody to answer the phone, you simply have a decent answer phone and ALWAYS call people back asap to arrange an appointment. Regarding holidays etc, then you will have to work them around your quietest time of year, or reschedule appointments around the holiday. My chiropodist has a 3 week holiday every year and closes for those 3 weeks and she has a full client database and a waiting list.

Regarding finding a premises, obviously you need the cheapest that you can get to start with, but it needs to look decent enough for your needs. If there are a lot of empty places in an area, you can maybe get the rent knocked down, but also you must realise that the footfall going past won't be great. If you are going to get a good deal of repeat custom, then passing trade won't matter so much.

venus has made a point that I forgot to suggest, look around and see if you can rent space in an existing premises, hairdresser or something in the same line of business as your business. It would cost a lot less and give you a very cheap base to work out of.

I went self employed as an accountant/bookkeeper in April 2011 after 20 years working for the same man. I had around 1.5 days a week work at that time. In 3 years I have built it up to full time work with a decent turnover and am just taking on a friend (self employed) to help me with some work.

It is hard work and 9-5 would be a lot easier and stress free, but I can work my own business around my DD, so it suits me better.

Something you might need to think about is the cost of public liability insurance.

I agree that it's a jolly good idea to rent a space in someone else's premises. I went self employed back in the UK in 2000, and I rented a room in someone else's clinic.
There were 2 bases upon which you could rent a room then - either you paid a percentage of your "take" for every client, which could be up to 1/3 of the charge; or you paid room rental regardless of whether or not you got clients. For an initial start up, paying percentage could work better because if you don't have any clients, you don't pay anything out, so you don't lose anything. But you do lose more if you have clients. The advantage to that method is that the clinic/salon/whatever has an incentive to help you get clients by promoting your service, as they won't get any money out of you unless you have clients.

I chose the other route - paid room rental because i was fairly sure I'd get clients, it was a new clinic, I was the only one offering the services etc. - and it worked for me. Room rental was a considerably smaller percentage of my hourly rate, and I very rarely had no one at all - even one client would cover my 3h rental.

The other advantage to renting time/space in someone else's premises is that you have more flexibility if you find that you're not bringing in enough money - effectively you're offering a luxury service, and clients often drop that service when their own income starts to tighten up, so it's a good idea to maybe have a second job, or even rent in another premises as well, to cover eventualities. I had a second job (my tax return was fun!) on the days that I didn't work in the clinic.

saying what I do might out me, but it is something very different from what you do - however I think the principles are the same across most very small businesses.

When I started my business plan showed income and costs (including a small salary) and showed a potential small profit after tax. This proved to be quite realistic although there were obviously some adjustments in income and expenditure as I went along.

I worked as hard as I bloody could, and so the profit after tax in the first 2 years was better than the initial forecast.

I used a little of this money to develop a product which added to my other services, but which (once developed) generated a residual income... not this.. but a helpful example.... If you are an aromatherapist then the amount you can earn is ultimately limited by the number of hours that you are able to practice your therapy and the amount that you can charge. If you add other products - e.g. selling specially commissioned aromatherapy oils, or selling fact-sheets, or running training courses, then you develop other sources of income which (after the initial time input) are an additional source of income, without much time input.

So... I created the product which makes a residual income, and this has had the effect of making me an 'expert' in my area, and so now I am asked to speak about what I do (and I get paid for that).... My income now is made up of 30% speaking at events, 50% 'graft' in my day job, 20% product sales. My time is spent 5% speaking at events, 92% day job, 3% product sales. They all work together as a whole, but whereas previously not accepting a client (or losing a client) meant a big and proportional change in income, now it is a less significant change, and it also protects me to some extent against illness etc.

It is also important to know where you are heading. If you want to earn £30K and have time with your kids, then that is one kind of plan. If you want to earn £300K and employ several people and set up a franchise system, then that is something else. And if you want to earn £3m and become a household name - well then please employ me to be your business strategist. I'd do it for 20% of your turnover