QUESTION: I have been out of work for over nine months and have little hope of securing a job in the near future.  I have been thinking of starting a business of my own and would appreciate any insights you can offer.

Cecil N., Golden Gate

ANSWER: Cecil, you have not indicated what kind of business you wish to start, so I will try to offer some general advice for your consideration. First of all, if you don’t have at least nine to twelve months of working capital to tide you over until the business begins to generate an excess of income over expenses, don’t do it. Second, if you don’t have first hand experience in the type of business you are interested in forming, please don’t do it.  And lastly, until you have constructed a written business plan that addresses your purpose, your competition, your strategic marketing strategy, and your sources of working capital, don’t invest the first dime.

Many would-be entrepreneurs are drawn to businesses they like to patronize or ones that are the cheapest and easiest to start. Instead, you should zero in on one you are intimately familiar with and that is underserved in the marketplace.

It is said “all that glitters is not gold” and this is true for many too good to be true businesses.  Some examples could include:

• Restaurants – Unless you like to work long hours, deal with unreliable help, stiff competition, local bureaucrats and seasonal slowdowns, restaurants may not be your cup of tea.
• Direct Sales – It’s a tempting pitch,“Work from your home, selling cosmetics, cooking and cleaning products.” A harder look, according to Ken Yancey, CEO of SCORE National, shows that the few making the big money are the ones recruiting others to do the actual selling of the product. Many wind up with a basement full of stuff they cannot sell.
• Online Retail – Get rich by selling things through eBay or Amazon.com. But as online commerce ages and these sites fill up with more established retailers, it’s much harder for new, small sellers to compete for attention and generate a viable income.
• Franchise Ownership – The idea of being handed a proven business plan without the uncertainties and headaches that come with building a business is understandably alluring. But too many people don’t understand the risks associated with franchising and sign restrictive agreements without thoroughly researching their franchisor and their contractual obligations, says SCORE’s Yancey.  Some franchisors allow franchisees to open stores too close together. Or they require so much in royalties, fees and other operational costs that it’s very difficult to be profitable.  Still others may make it extremely difficult to get out of the contract.  Some franchises can prove to be a good investment, but you must first do your homework. Check with other franchisees and have a qualified attorney review the contract.

Owning ones own business is a common dream for many people. The volunteers at the Naples Chapter of SCORE, Counselors to America’s Small Business, can assist you in developing a viable business plan. Counseling is offered FREE of charge. Just call 239-430-0081 or visit www.scorenaples.org and click on “Request counseling now as a first time client.”  The SCORE business office is located at 900 Goodlette Road North, in the Fifth Third branch bank building.  Office hours are 9:00 AM to Noon, Monday through Friday.

SCORE and the Naples Chamber of Commerce will conduct a workshop titled, “Creating Effective Alliances That Work.” Saturday, September 26, from 9:00 AM to 12:30 PM, at the Chamber offices 2390 Tamiami Trail N, # 210. For more information and to reserve your seat online, go to www.scorenaples.org; click on “Workshops” and then on “Sign Up”, or register by phone at 239-430-0081.

If you would like an answer to your business question, please fill out the form located at www.scorenaples.org. A counselor will contact you within 48 hours. Please include your name, email address and a contact phone number