Core Skills You Need to Start Your Own Business
More people than ever are leaving their jobs to become small business owners. It’s an exciting – and daunting – prospect, but with the right skills, hard work, and dedication owning your own business is one of the most rewarding career paths.
In fact, 91% of small business owners report high satisfaction with their career; that tops the list over even high-level and high-paying corporate jobs.
There is a myriad of reasons people decide to start their own business, but some of the top reasons include:
- They want more flexibility
- They want to be their own boss
- They want to do something they are passionate about
- They want to give back to a community
While managing your own business isn’t for the faint of heart, it can be achieved by virtually anyone who has a grasp of essential business and financial principles and skills.
These days, starting your own business can look like anything from a brick-and-mortar retail shop to an online crafting store. Many people also choose to become freelancers or contractors, but to do this you need more than just your core skills. You need to understand the basics of running a profitable and successful business. bec
What are Business Skills?
The skills needed to start and run your own business revolve around anything to do with the management of your business, from financial skills like payroll and accounting to communication skills like leadership and human resources.
While you can hire or outsource specialists who are experts in some areas, it is important for you to understand the basics of what is needed in order to hire the right people and oversee the growth and profitability of your business.
In this article, we will review six essential skills needed and explain them in more detail, but before we get into the specific skills, let’s discuss the difference between a hard skill and a soft skill.
The Difference Between Hard Skills and Soft Skills
Hard skills are abilities that are quantifiable and teachable. Hard skills are typically learned in an online or offline classroom setting through training materials and books. These are skills you typically list on a resume to summarize the body of your knowledge. Examples of hard skills include:
- Computer software and hardware knowledge
- Proficiency in a foreign language
- Typing Speed
- Degrees or certificates
- Machine operation
Soft skills are subjective and harder to quantify. They are sometimes referred to as “interpersonal” or “people” skills and they revolve around the way you communicate and interact with others. It is difficult to provide evidence (other than references) of your soft skills, but they are just as important as hard skills when it comes to running your own business (or any job). Examples of soft skills include:
- Time Management
- Work Ethic
- Problem Solving Abilities
You will see in the summaries below that some of these are only hard skills (like financial skills), some of them are soft skills (like communication), and some utilize both hard and soft skills (strategic planning, marketing, and sales).
Core Skills Small Business Owners Need for Success
Strategic Business Planning Skills
It’s important to have a passion and talent to start your own business, but there is a lot more to running a business than that. If you can make amazing jewelry, for example, and you want to start an online store, making incredible jewelry won’t be enough. How are people going to hear about your shop (marketing)? Where are you going to host your shop (technology)? What price should you sell your jewelry to make a profit? How do you know if your business is profitable? When and how should you be collecting and reporting taxes (all accounting and finance)?
This is where overall strategy comes into play. Before you get going on pursuing your passion, take time to create a business plan to set specific goals and determine when – and how – you are going to achieve them. How much jewelry do you need to sell to support yourself? Can you do that alone or do you need to hire people? Do you need an invoicing and accounting platform, and if so – what should it be? Where do your business’ growth to be in 6 months and a year?
Mapping out the strategy for your business in advance will help you stay on the course for your short- and long-term goals and make needed adjustments along the way. Failing to set up a strategic plan for their business is a common trap many new business owners fall into. Once your business gets going you will be caught up in day-to-day operations and it’s easy to lose sight of the overall picture.
It is vital to have the accounting and bookkeeping skills you need to plan, organize, and control the financial activities that your business requires. You need to budget effectively and report your financial performance. You need to understand what areas are affecting your revenue and know how to adjust as needed. With these skills you can calculate your profit and loss and be able to budget wisely.
Before investing any money into your business, know where it fits with your business plan and how to incur expenses that won’t eat away at your revenue.
Even if you outsource for help in these areas, without an understanding of how and why financial decisions impact your business you cannot oversee the performance of anyone you retain or hire.
Marketing and Sales Skills
Once you are ready to tell the world about your new business, you need to be proficient in how to attract and convert new customers. Many small business owners lump marketing and sales into one area, as few have the budgets to separate them, but they involve different skills.
Marketing is how you generate interest in your business and approach prospective leads through tools like social media, email marketing, content marketing, and advertising. To market effectively you need to understand your target audience, know how to build a brand around your product or service, and understand what your product or service does to help your prospects to build effective brand messaging.
Sales are how you convert a prospect into a customer from the leads driven your way through your marketing efforts. Many people are more comfortable with marketing than sales, as it takes key soft skills like negotiating and persuasiveness to land a new customer.
Take stock of your personality and preferences to determine if you have the sales skills to convert a lead into a client. Are you great at getting people interested but struggle to convert them to customers without resorting to discounts or special offers? Consider working with a partner or hiring a team member who possesses these skills if this is an area where you struggle.
How you communicate impacts every single aspect of your business, from employees to customers. Effective and professional communication skills are needed in everything you do, from sending an email to handling a customer complaint.
Communication comes in both written and oral format, as well. While you may not think about it consciously, everything you say and everything you write affects your brand and the potential success of your business. There is more to communication than that, though, as listening skills are equally important to make prospects, customers, vendors, and employees feel heard and valued.
Time Management Skills
Time is money, especially when managing your own business. It is imperative to have exceptional time management skills, be organized, and understand how to best prioritize your time.
Especially if you are coming from an environment where you performed the same (or similar) tasks day in and day out, learning how to be your own boss and manage your own time is an invaluable asset. As your business grows, it is likely you will not be able to handle everything on your own.
There are time management apps that can be helpful as well. Plan your days in advance to balance your workload effectively and schedule your time accordingly. Be prepared to hire or outsource when your workload is more than you can manage on your own.
These days it isn’t possible to effectively grow a business without understanding technology. It is important to be comfortable using a computer, know how to navigate online to find tools, aps, and information, and use software applications, like a Customer Relationship Management system or QuickBooks, to manage the back end of your business.
If you have a dream of starting your own business but aren’t computer-savvy, enroll in training courses that can teach you everything you need to know to get started.