Steve over at MyWifeQuitHerJob recently posted about why he hasn’t quit his “day job”. He makes some interesting points, though I’ve made the opposite decision for myself. Are you thinking about leaving your day job? Here are some things to consider:
1. Do you really want to quit your day job?
On the face of it, you might say yes, but really think about whether you want this. Are you comfortable with leaving a career you may have spent years building? Are you okay with giving up the steady pay check, the guaranteed health insurance, the 401k matching? Some people can’t, psychologically, feel comfortable with giving up those things.
I struggled with this myself. I was wary of leaving a very lucrative career I’d spent over a decade building. It was also a shift in thinking for me. I’d always had my own thing throughout my partnership with my husband. Leaving my day job meant being entwined professionally.
In the end, I chose to leave my day job for a few reasons:
1. I hated my day job.
2. I am truly happiest spending my time with my husband/business partner.
3. I can actually make more money leaving my day job and focusing on our growing business, and this point brings me to…
2. What are your revenue streams and financial forecasts like?
It’s one thing to want to leave a day job, it’s another thing entirely to be able to still pay your bills doing it. In order to be sure you can afford to leave your day job, it’s important to examine your revenue streams and income projections.
It’s important to map out specifically how much money you’ll make from various income sources once you’ve left your day job. Will you be doing pop up events? How many, what will the attendance be, what percentage of attendees do you expect will buy, how much will the average order be? Have you done these pop up events in past years/months/weeks? How much did you make last time?
Will you be doing wholesale? How many accounts do you have, how often do they order and what’s their average order value? How many new accounts do you project you can bring on each month and what is the average order value?
Will you be doing online sales? How many orders per month do you get? What’s the average order value? What are your costs with doing online sales?
It’s important to answer questions like these and be sure to take into account all of your costs and income. Can you still earn enough money to support yourself based on your past experience and projections?
3. What is your safety net like?
If your financial projections aren’t met, what is your back up plan? Do you have savings or assets you can leverage to get through difficult periods? Are you comfortable with falling back on your safety net if things do not go as planned? At what point will you consider going back to a day job if your projections aren’t met?
3. How serious are you about your business?
I would argue that if you are deeply serious about building an empire, you are going to have to eventually quit your day job. I can’t think of many nationally recognized brands with an owner who has a separate day job. If you want to build a large business it’s going to demand your full attention. What I mean by this is you probably won’t be the next Ed Hardy or Kate Spade if you expect to run your creative business and work a day job simultaneously from now til you retire. If that’s your ambition, you are eventually going to need to leave that day job.
Not everyone wants to be the next Kate Spade or Ed Hardy, and that’s fine too. Building a brand of that size means you probably won’t be doing any hands on making of products. It means you won’t be the person answering the phone when customers call, it means you won’t be doing it all yourself. You will have to manage staff, rent the office space, hire the lawyers and accountants, etc. It means getting a lot more corporate and a lot less mom and pop. It’s not the model for everyone and there’s certainly tons of variation between DIYer and corporate mogul. It’s important to think about where you want your own business to go and what choices you’ll have to make to get those results.