Have you decided that being your own boss suits you more than the 9-5 treadmill?
There’s plenty of factors to consider when it comes to choosing an industry that fits your skills, attributes
Choosing the right industry to buy a business
You want to be confident in the decision you make – after all, you’ll probably be plunging personal savings and a lot of time into the project. So, don’t take the commitment lightly.
There are arguably three factors to consider that should take primacy over the rest when choosing the right sector.
An obvious starting point to consider is your career up until now. What industries have you worked in before?
You don’t necessarily have to buy a business in the same sector – but it helps if there are at least some transferable skills to bring across to your next field. For instance, if you’ve worked in cafes, your experience will readily apply to the hospitality sector – i.e. bars, restaurants and, to a lesser extent, B&Bs or hotels.
If you’re a lifelong accountant, meanwhile, these skills apply to most sectors – accounts are an unavoidable part of any business.
Your past experiences can help you draw up a shortlist. Brief stints in many industries needn’t be worse than
If you’ve always hated office environments, for instance, that can eliminate many sectors from your thoughts.
- Which industries do I have experience in?
- What skills do I have, and can I apply these to other fields?
- Which of these skills can I apply to business in general?
- Which sectors did I perform particularly well in - or poorly - and why?
- Money and risk
Money and risk
Some sectors are more lucrative than others.
The chances of becoming a millionaire off the back of a restaurant are slim, and the hours are long and exhausting to boot. A tech start-up, however, may attract millions in venture capital and make you rich overnight.
Some businesses, like dry cleaners, are often safe bets but only ever generate a modest income. These are more your lifestyle businesses.
Are you hoping to become very wealthy or are you more driven by job satisfaction?
Do you have an appetite for risk or do you prefer to play it safe?
Also, take notice of commercial trends. Healthcare, tech, construction, and education and training are projected to be among the fastest-growing sectors in Australia for the years and decades to come.
- What is my budget?
- How important to me is making a lot of money?
- Do I have an appetite for risk?
- What sectors are most promising in terms of future prospects?
Passions and interests
When it comes down to it, it will probably take a lot more than money to keep you excited about your business.
Being passionate about what you do will give you job satisfaction, enthuse your employees and impress customers. And all of this keeps you going during the tough times that inevitably sometimes arise.
Make a list of what you enjoy doing and the tasks you find tedious or stressful.
You might enjoy interacting with people or working outdoors; your dislikes might be working at a desk or working evenings and weekends.
This list will help you draw up a shortlist that fits your talents, personality
- What am I passionate about in life and what does this say about me?
- What elements of my past jobs have I loved?
- Are there things that I don’t like that may be a barrier in certain industries?
It’s important to be realistic. There is always room for ambition but try not to choose an industry for superficial reasons – like buying a bar simply because you enjoy drinking and
And your choice needs to encompass some combination of two or three of the factors outlined above. Don’t buy an online retailer, for example, because you anticipate low overheads and strong growth prospects, but you lack the requisite skills, experience or passion for what’s involved day to day.
Once you’ve decided on an industry, it’s time to start browsing the market and find the right business for you.