Am I prepared to spend the time and money to make my business successful?
Perhaps the single biggest reason that businesses fail is because the business owner(s) is not prepared or willing to spend the time and money that it takes to make a business successful. Before you start your debt collection business, be sure that you are willing to invest the time and money it takes to make your business successful. How much money will you need and how much time will you need to spend? Both questions are very pertinent and vary in their answers.
How much money will I need to spend? – This one is not as cut and dried as one would think. Will you be working out of your home or from an office? Typical expenses that you should consider before you even open your door are the following:
- Office space and cost
- Office equipment (phones, desks, chairs, internet, computers, servers, etc)
- Business licenses
- Employee wages
- Software (skip tracing, auto dialer, merchant account, letter fulfillment services, debt collection software)
- Bank accounts
- Legal council (for establishing contracts, business agreements, etc)
- Website and advertising
Statistically, the reason for small business failure comes from living outside your business means, or having insufficient capital. Most business owners want the freedom and prestige of owning their own business, but overlook the fact that it still requires money … a lot of money to just run a business. This means you may have to go without some things in order for your business to succeed.
How much time will I need to invest? The easiest answer to this question is … “AS MUCH AS IT TAKES!” There will be nights that you come home late, days you go in early, weekends that you will spend running reports, hiring new collectors, and meeting with clients. While there is light at the end of the tunnel and not every day will have your nose to the grindstone, you need to be willing to invest your time into the business to begin with.
Even if you do invest your time and money into your business, statistically, there is a 72% chance that it still won’t make it past the first year. If you manage your business correctly, put in the time and money, and have a knowledge and passion for debt collecting, you are well on your way to being successful.