Business According to the Bible

A recent survey found that 51 percent of Americans would like to launch a business within the next five years. If you sense that God may be leading you to start your own business someday, there are several steps you should take to position yourself to succeed.

1. Prepare yourself financially.

One of the most common reasons for the failure of start-up businesses is lack of capital—not enough cash saved up. When you begin a business with lots of borrowed money, you invite added pressure to be profitable quickly. Many businesses require several years to become profitable.

This is my recommendation:

• Be patient!
• Save as much as you need before launching your business.
• Use as little business debt as possible, and pay it off as quickly as possible.

When you operate with little or no debt, you have a competitive edge against businesses saddled with large monthly payments. You also have more financial stability to weather unexpected challenges.

2. Identify a good business opportunity.

Research business opportunities for which you are well suited—ones that you think you would enjoy, that you can afford to start, and that meet your personal goals. When you discover one, gain some experience in the business before launching into ownership.

3. Pray for a mentor.

4. Draft a business plan.

Address these issues when you create a business plan:

• Organization: Choose between a sole proprietorship, a partnership or corporation.
• Marketing: Identify your competition and determine how you will promote the business.
• Employees: Decide how many and what skills will they need.
• Financial projections: Estimate your income and expenses.

When it comes to planning, gather all the facts you can. Good planning is always based on accurate information, and that takes work. World War II military leader General George S. Patton constantly preached to his soldiers about gathering facts. When reviewing the reasons for his commanders’ recommendations, he would frequently ask, “How do you know that?” One of the general’s principles was, “Know what you know and know what you don’t know. Every plan is based on a mixture of known facts, unknowns, and assumptions. Many assumptions can be turned into facts with a little research.”

5. Set up your accounting.

Many start-up businesses fail to keep accurate accounting records. This is dangerous because you will be unable to track your profitability and tax liabilities. I recommend using a business checking account for depositing all business income and paying all expenses. Record a description of every transaction in a check register or an accounting software program. At the end of an accounting period, it will be easier to compute the profit or loss. If you are self-employed, a good rule of thumb is to set aside about 30 percent of your net income for taxes and withholding so you won’t be forced to use debt to fund your tax payments.