Colette Sexton, news correspondent at The Sunday Business Post, shares tips on how to make the leap to being self-employed.
Many people dream of being their own boss but few actually pursue it. Often, people are scared of giving up a regular salary, the uncertainty of self-employment, or just of failing. And while these reasons apply to both men and women, men are far more likely to set up their own businesses. Just one in five of entrepreneurs in Ireland are women, a study from Mastercard found last year. But when we do set up businesses, we often do better than men. Female-led companies start with 50 per cent less capital and have 13 per cent higher revenues than their male counterparts, a study from .CO found last year.
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What you need to set up a business
It can be hard to know where to start when it comes to setting up a business. Firstly, you need an idea for a product or a service that people must be willing to pay for. You also need some initial money to help get started and buy necessary supplies and equipment. You will need to make sure you have a safety net of cash that can get you through periods of little or no income. For this reason, many people first set up companies as side businesses while continuing to work full-time, until they are sure they can support themselves financially.
It might also be worth doing a short course in business if you have no experience in things like managing cash flow, record keeping and accounting to ensure you start off on the right foot. Otherwise, you might end up with a successful business that you have to shut down because you have not managed supply chains well or paid your taxes correctly. Plus these courses can advise you in how to find customers, market your business and set up a website — all vital ingredients for a successful business.
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Once you are happy to set up the business, you should decide whether you want to be a sole trader or set up a company, before registering with the Revenue Commissioners. Following that, you must register the business name with the Companies Registration Office. You should set up a bank account for the business and if you are not happy to do the tax returns yourself, get an accountant. Having a lawyer will also be vital if you have invented something, as you will need to patent it.
Feeling overwhelmed by those steps alone? There are lots of supports available for entrepreneurs in Ireland. Your Local Enterprise Office will be a good place to start. Being self-employed is not easy but it can be very rewarding.