4 Steps to Follow When Leaving the Corporate World for Entrepreneurship

After two decades in the workforce, Ohio businesswoman Deborah Wasylko found herself faced with the prospect of having to move to keep her job while dealing with challenges in her family life. Wasylko concluded that she had a choice: continue her corporate career or become an entrepreneur.

“I decided to start a corporate gift company, because that’s what I love to do,” says Wasylko, the founder and president of Baskets Galore, which creates gift baskets for corporate clients. She had long been enthusiastic about visual design and making people feel cared for, she says, and her new venture touched on both interests. “It was my opportunity to re-engineer my career and follow my passion.”

The allure of becoming your own boss seems strong: As of 2014, there were more than 29 million small businesses in the U.S, up 6% from 2010, according to the U.S. Small Business Administration.

4 Steps to Follow When Leaving the Corporate World for Entrepreneurship

But excelling in an office doesn’t mean you’re bound for entrepreneurial success. In addition to many logistical and financial challenges, the transition from employee to entrepreneur involves a distinct shift in mentality. Before you make the leap, take these steps to make sure you’re ready beyond the numbers.

1. Talk with Other Entrepreneurs

The best way to psychologically prepare for the jump from a corporate job to calling the shots is to talk with those who have already made the transition.

“You don’t want to reinvent the wheel every single time,” says Cathy Posner, a small-business coach in Ohio.

Ask other entrepreneurs how their roles in corporate America prepared — or failed to prepare — them to run a small business. What do they wish they had done differently? What do they wish they had known ahead of time?

And, most importantly, would they do it again?

2. Identify Your Resources

A small-business mentor from SCORE is invaluable to entrepreneurs, Posner says. This free program, which is supported by the SBA, connects seasoned professionals with small-business owners. A mentor can help you turn your understanding of corporate goals into a business strategy. He or she can help you define your services, determine the fees you’ll charge and give advice on daily business tasks you may not have handled before, such as marketing and managing employees, Posner says.

Ultimately, you are your best resource. The skills you developed in a corporate environment — project management, organizational skills, employee management — will be even more important, says Posner. “Everything that you do starts to be magnified.”

Wasylko particularly appreciates having learned in the corporate arena how to remain calm in the spotlight, giving presentations in front of executives or large crowds. As a fledgling business owner, “I wasn’t intimidated, and I had more poise as a result of doing all those things: being clear, being decisive, being organized,” she says.

3. Prepare Yourself for Uncertainty

Being an entrepreneur involves higher highs and lower lows than working in an office, Posner says.

“In many corporate environments, your responsibilities can be pretty segmented,” she says. But when you’re a small-business owner, “the buck stops 100 percent at you.”

Brainstorm ways to keep yourself grounded in the face of uncertainty. After JJ DiGeronimo transitioned from Silicon Valley startups to running a consulting firm for women in tech fields, she found she had to redefine what success looked like.

“I think entrepreneurship brings out your own deficiencies, and for me, a lot of that was around self-identity,” DiGeronimo says. After years of identifying with her title and salary, she found herself in a role that emphasized the less concrete objective of personal and professional growth.

“Our society often aligns success to money, but as an entrepreneur, it can take time to make money,” she says. “Finding ways to align to the goodwill of your work is important.”

DiGeronimo found support from fellow entrepreneurs, blogs and books; a favorite was “The Soul of Money: Reclaiming the Wealth of Our Inner Resources.”

4. Network, Collaborate, Repeat

In a corporate environment, you’ve likely already dipped your toes in the networking pool. Take advantage of those connections before you leave your 9-to-5. Contacts and resources may prove invaluable, and you never know who may become a client. Networking events are also a good place to meet other business owners with whom to collaborate, Posner says. For example, wedding photographers and florists often cross-promote services.

And networking groups provide a partial replacement for one of the major benefits you’ll lose after leaving your job: colleagues.

“When you go off and work by yourself, sometimes you need that energy,” DiGeronimo says. “You need that soundboard.”

Ditching the Suit Photo via Shutterstock

This article, "Following These 4 Tips will Make Leaving the Corporate World for Entrepreneurship Easier" was first published on Small Business Trends

How to Create Your Own Pension Fund

Like flip phones and floppy disks, pensions are largely a thing of the past.

According to an analysis from global advisory firm Willis Towers Watson, the percentage of Fortune 500 employers offering a defined benefit pension plan to new hires dropped from roughly 50 percent in 1998 to just 5 percent in 2015.

Today’s workers are more often offered a defined contribution plan, such as a 401(k). The difference is evident in the name: A defined contribution plan lets employers and employees contribute to an investment account. A defined benefit plan promises employees a set benefit at retirement and puts the responsibility of providing that benefit — including the investment risk — on the employer.

Create Your Own Pension Fund

It’s easy to see why people without pensions are envious of older generations. But it’s still possible to create pension-like income on your own. Here’s how.

Consider an Immediate Annuity

With an immediate annuity, you give an insurance company a lump sum and receive monthly payments for life. The amount of those payments depends on a few factors, including the size of the lump sum, your age and interest rates.

These annuities can address the fear that your money will dry up, but they aren’t for everyone, says Neal Frankle, a certified financial planner and blogger at WealthPilgrim.com. “The No. 1 problem is that you give up access to that money. If you die tomorrow, it goes away.”

You can structure the annuity so that if you die before receiving an amount equal to the lump sum, the balance goes to your beneficiaries — but electing that option will lower the amount you get each month.

Keep Some Stocks; Start an Income Plan

Some believe that it’s best to invest in stocks only preretirement; post-retirement, it’s all about bonds and fixed income. In reality, shunning equities after you’ve stopped working might be one of the quickest ways to run out of money. You need your money to continue to grow in retirement, and stocks provide that growth.

Once you have a properly allocated portfolio, you can work with a financial advisor to create an income plan that details how you’ll approach withdrawals.

A tip from Frankle: Ask to receive monthly distributions. “It’s only natural that when people get to the stage of not getting a paycheck, it’s scary. Rather than setting up a once-a-year withdrawal, set it up so it’s almost like a paycheck.”

Monthly distributions also make it less likely that you’ll pull more than you need from a 401(k) or an individual retirement account. It can be hard to return unused money due to the contribution limits on those accounts.

Bank on Your Home

If you own your home, you can use a reverse mortgage to take advantage of the equity you’ve built. These mortgages allow you to stay in your home and convert that equity into a stream of monthly payments. As long as you remain in the home, you don’t have to pay back the loan. If you move, sell it or die, the loan is typically repaid from your estate or the proceeds of the sale.

These loans have historically gotten a bad rap due to high costs and variable interest rates, but in recent years, they’ve grown better in these respects. Still — like immediate annuities — they’re not the right choice for everyone. Before you consider one, Frankle suggests another option: downsizing.

“If you need a reverse mortgage, chances are very good you’re living beyond your means, and you’re spending more than is coming in,” he says. “A reverse mortgage doesn’t solve that core problem. Many people would be better off downsizing and reducing expenses.”

Downsizing might not give you additional income, but it does make more of your income available for other expenses.

Piggy Bank Photo via Shutterstock

This article, "Explore These 3 Approaches to Create Your Own Pension Fund" was first published on Small Business Trends

Nevada Pot Supply is Running Low -- After Just 1 Week in Business

Nevada dispensaries are selling marijuana at such a fast rate since opening their doors July 1, the state is reporting a weed shortage that could threaten jobs in the burgeoning industry.

Nevada Pot Supply is Running Low

The Nevada Department of Taxation announced Friday that less than a week into the first legal sales in the state, they must take emergency measures to ensure the steady flow of marijuana to dispensaries. Republican Gov. Brian Sandoval endorsed a “statement of emergency” from the department to adopt measures that will help bolster the marijuana supply for dispensaries by reforming rules on distributor licensing, reports USA Today.

Advocates for Nevada’s marijuana industry say if the issue is not resolved quickly, jobs at small businesses across the state will be placed in jeopardy. The Nevada Tax Commission is expected to vote on the new measures as early as Thursday.

“Based on reports of adult-use marijuana sales already far exceeding the industry’s expectations at the state’s 47 licensed retail marijuana stores, and the reality that many stores are running out of inventory, the Department must address the lack of distributors immediately,” Stephanie Klapstein, a spokesman for the Department of Taxation, told USA Today. “Unless the issue with distributor licensing is resolved quickly, the inability to deliver product to retail stores will result in many of these people losing their jobs and will bring this nascent market to a grinding halt.”

The marijuana industry is off to a lucrative start in Nevada, raking in nearly $3 million over the first four days of legal sales.

The Department of Taxation will not release official figures for marijuana sales or revenue collected until September, but the Nevada Dispensary Association estimates that the state has already pulled in roughly $1 million in revenue from legal sales. The group estimates that dispensaries made roughly $3 million from sales between Saturday and Tuesday.

The early sales figures put Nevada dispensaries on pace to make nearly $30 million by the end of the year.

Las Vegas Photo via Shutterstock

This article, "Nevada Facing Emergency Pot Shortage — After Just 1 Week in Business" was first published on Small Business Trends

Is a Buying a Car During the Summer a Sound Business Decision This Year?

It’s a good news-bad news situation for car buyers this summer. While bargains can be found, the money saved could be canceled out by lower trade-in prices, industry analysts say.

“It’s a great summer to buy a car,” says Michelle Krebs, analyst for online car marketplace Autotrader. But she advises shoppers to carefully consider which ownership and buying scenario works best for them. Shoppers might ask, “do I go for a new car with incentives or do I look at a [used] off-lease vehicle? You’ll just have to do the math on that,” she says.

Car lots are jammed, discounts are deep and incentives — such as cash back and low-interest financing — are high, particularly on sedans and subcompacts, says Anil Goyal, a senior vice president and analyst for Black Book, which tracks used-car pricing. Shoppers looking for an SUV, crossover or pickup truck, however, shouldn’t expect bargain basement prices.

Paying Less, Getting Less on Trade-ins

The situation is really “a double-edged sword,” Goyal says, because, although you’ll pay less for a new car, you’ll also get a lower price for your old car. Black Book data show that from 2011 to 2015, a used car 2 to 6 years old depreciated 10 to 13 percent each year, on average. In 2016, that depreciation rate jumped to 17 percent.

But not all cars depreciate at the same rate. For a shopper trading in a pickup or SUV, which have strong resale values, and buying a discounted sedan the combined savings will be substantial. Anyone just entering the market, or not trading in, will also be happy with their savings.

A ‘Tidal Wave’ of Used Cars

With seven years of strong sales, car makers have churned out a flood of new vehicles. But it’s taking a week longer to sell a new car than last year, Krebs says. New-car sales dipped 0.5 percent in May and 4.7 percent in April, according to Automotive News.

Dealers are getting nervous and car makers are throttling back on production, propping up sales with incentives. To keep cars moving off the lot, these incentives are up sharply. They now amount to an 11 percent reduction off the suggested retail price, Goyal says, citing Black Book data.

Now, Goyal says, as sales of new cars plateau, the market has to absorb used cars coming off leases.

“We are going to see a tidal wave of [off-lease used cars] coming through until at least 2020,” Krebs says.

Buying a Car During the Summer

Bargain Hunting

To find bargains, a savvy shopper should look for “cracks in the market” — areas others haven’t thought of, says Scot Hall, executive vice president of operations for Swapalease, which matches people who want to get out of their vehicle lease with those who want to take over a short-term lease. An example would be shopping for a discounted sedan or compact rather than a more expensive SUV or pickup.

Another key to saving money is to take full advantage of incentives, which are listed on the manufacturer’s website, Hall says. One recent trend, according to Hall, is a surge in “conquest” cash incentives, which reward a shopper who buys a different brand of car from the one they previously owned.

Shoppers wanting cars with the latest technology are finding leasing an affordable way to keep up with the times, Hall says. In 2016, leasing reached an all-time high of 31 percent of new-vehicle sales, according to Edmunds.com.

Summer Car Shopping Tips

Knowing the changes in the car market will help shoppers make smart buying decisions. Consider these additional strategies when hitting the car lot this summer:

  • Avoid offers of new-car financing terms over 60 months. They cost more and depreciation increases your chances of becoming upside-down on the loan.
  • Begin by pricing your trade-in. If the value is too low, consider delaying your purchase until used-car prices rise again.
  • Run different scenarios on a car loan calculator to compare whether customer cash back, leasing or low-interest financing offers you the best savings.

And finally, even if a dealer’s asking price looks attractive, try negotiating a lower one.

“It never hurts to ask,” Hall says.

New Car Photo via Shutterstock

This article, "What Everybody Ought to Know About Purchasing a Car for Business This Summer" was first published on Small Business Trends

Tips for Hiring Seasonal Employees

While some businesses may have already hired extra staff for the summer, others are still in the throes of interviewing and reference checking. Hiring seasonal workers can be a stressful task for a business owner, but using these five tips can make it easier.

Tips for Hiring Seasonal Employees

1. Create a Clear Job Description

Focus on writing a job description that presents your company in a favorable light and provides a clear, accurate description of job duties, says Jennine Rochlin Leale, founder of HRPro Consulting Services LLC. This can help you avoid hiring what could become a disgruntled, unproductive employee, she says.

If a strong performance during the summer can lead to a full-time employment opportunity or strong references, highlight those benefits in the job listing — you’ll get a higher rate of response from applicants, Leale says.

2. Tap Into Social Media

Use social media to show your business has a positive culture, treats its employees well and provides opportunities for its employees to grow and learn, says Flynn Zaiger, founder and CEO of Online Optimism, a digital marketing agency.

“We show off our culture and the appreciation we have for [employees], even if they are only with us for a short time,” says Zaiger, who recommends using images and videos of current employees to engage with job candidates. Be sure to consult with your human resources or legal team to make sure you’re following photo permission and parental consent laws.

Post on social media if your business tends to draw younger seasonal employees. Teenagers spend most of their social media time on Instagram, Facebook and Snapchat, according to a 2015 study by the Pew Research Center.

“Social media can give them a reason to choose you over the other options,” Zaiger says.

3. Ask Current Employees for Referrals

If you don’t have an employee referral program, consider implementing one now.

Employees hired from referral programs are more efficient, more likely to stay with your business and generate 25% more in profits for companies than their peers, according to a paper by the Institute for the Study of Labor.

Offering a gift card reward for a successful referral can be a smart strategy for a seasonal position hire. Leale suggests making it clear to employees, in writing, that the new-hire must work through the season for the referring employee to receive the gift card.

“Now you have that person invested in the other person sticking and being responsible,” she says.

4. Host a Job Fair

Hosting a job fair increases the number of people you can interview in one day and boosts employee morale, says Laura Platt, HR manager at Spreadshirt, a global e-commerce company.

“With the staff participation, the day is exciting and it creates a sense of unity within the team,” she says.

The idea also benefits applicants, who save time scheduling interviews and can get an idea of how current employees work together, Platt says.

Plan ahead to get a better response and avoid wasting money and time. Platt’s company typically starts to advertise a job fair about two weeks before the day via social media, flyers and road signs, and contacts local schools, organizations and community centers to get the word out.

“This is about putting the best foot forward and showing them who the company really is,” Platt says.

5. Vet Each Candidate

Once you’ve compiled a solid pool of candidates, carefully examine each applicant’s resume and references and conduct a background check. The process for hiring a quality seasonal worker is just as important as hiring a permanent employee, Leale says.

“If you don’t vet them properly, they could be more of a problem for you than the problem you hired them to solve,” she says.

During the interview, ask questions focusing on a variety of scenarios to find out how the candidate may behave in different situations, says Jody Holland, a corporate trainer, executive coach and consultant.

For example, ask about a time a candidate had to deal with a difficult situation at work or in school and how the issue was resolved. You can establish a rating system for each candidate, then keep track of the ratings and when hiring, you’ll be able to see the candidates who have the top scores.

“It works particularly well with seasonal hiring, since you are trying to do hiring much faster than, say, a hospital, who spends five hours interviewing one candidate,” Holland says.

Ice Cream Shop Photo via Shutterstock

This article, "Best 5 Tips for Seasonal Hiring" was first published on Small Business Trends