Finding your bearings

When I left my job at AfrikanSwiss. I was not doing much for a few months and a friend of mine suggested that I take my Twitter handle and make it a business. I was nowhere but I decided then and there to take a leap of faith and see what it could become. I borrowed R8 000 to make 100 jeans. It took six months to sell them...

Tshepo Mohlala

Our friends at LifeCheq help people make difficult life decisions, like starting a business, by combining research and financial modelling techniques to illustrate the possible scenarios. In this module, they outline the major things you need to consider before starting a business.

Even if you have a fantastic product or service, it takes time for people to catch on. But while you are busy building up your client base, you still need to pay your employees, cover your rent, buy your materials, and have enough left over to meet your own living expenses.

Fact

62% of Yoco merchants jumped straight into business. No waiting around, dreaming about their future business. Download the Art of Getting Start to read more about how real business owners got their start.

Before taking the plunge, you therefore need to answer the following questions:

  • What are my initial set-up costs and monthly running expenses going to be?
  • How many clients would I need to have/what would my sales volume need to be in order for me to start making enough money to cover all my expenses, including my own living costs?
  • How long do I think it will take before I reach that target?

Your answers will not be 100% accurate, but at least you’re thinking about the real numbers that will drive your business.

But how do you know if your idea works in the real world. The next lesson looks at how to test your idea.