Make The Right Moves And Ask The Right Questions
One person’s success in business does not automatically translate into guaranteed success for another. Thus, if you are presented with a business opportunity — no matter how great it sounds — carefully evaluate all business proposals. It could pay off to be shrewd because you save yourself money on opportunities worth passing up.
In the eagerness that often accompanies starting a new business, risks could be miscalculated, dangers ignored, and the uncertainties of being in business not fully considered. In such a situation, what factors should you consider when evaluating a business proposal?
• Carefully examine the details of the business proposal before making a decision. Ask yourself the following questions: What are the risks? Is this a loan or investment? What happens if the business fails? Do banks view this business venture as too risky, and why?
• Document all business arrangements in a formal written agreement. This includes business agreements among friends and family members. A clear, concise and well-prepared written agreement helps to prevent potential misunderstandings and preserve unity among the parties involved. Not having a written agreement contributes to problems when outcomes and expectations have not been documented for the benefit of all involved in the business transaction. More relationships are strained or ruined over money.
• Be honest in your business dealings. Honesty is a best practice in itself. While not all share this core value, determine whether you have the resources, time, skills or money to pursue the business opportunity. Will this opportunity rob you of peace of mind or take resources away from your family that they need to survive? What demands and expectations from partners or investors will be placed on you? Can you meet those demands?
• Protect yourself and your investment — seek legal advice, do some market research, analyze the risks, and identify your responsibilities and roles, as well as those of your partners or investors.
• Prepare an exit strategy. You may have done everything as planned, but you do not control everything in the business environment, so plan for the other than success route.
The potential of huge earnings can blind one to the risks of an unsound business venture. When contemplating a business opportunity, ask yourself, “Have I fully weighed the pros and cons of this business opportunity? Can I do it? Should I do it?”
If you have followed the best practices above and weighed that the business opportunity is a good one — go for it.
Wanda Lipscomb-Vásquez is a training specialist at Sun Nuclear Corporation in Rockledge and founder of Healthful Humor, which empowers organizations to enhance the patient experience for younger patients, families and others by nurturing a culture that fuels the art of therapeutic humor to help them connect with providers and others through shared experiences.