Setting up shop on your own

There will be very few managers in the contract manned guarding sector who have not, at one time or another, seriously considered setting up on their own. The reasons for this are obvious – and founded in a belief that, if you have to work all hours that God sends for little reward and much hassle, you might as well do so for your own benefit!

Normally, such feelings come on strongest when you're propped up at the bar staring at the bottom of an empty glass. However, the reality of the situation is somewhat different. Be aware that venturing into the world of ownership has its pros and cons.

Anyone who has run their own business – particularly those operating in the manned security sector – will be only too aware of the sleepless nights caused by negative cash flow. You have to pay the security officers today because, if you don't, there's every chance they will not appear tomorrow. Your client has no such worries, and appears unconcerned that if they fail to pay on time you are likely to be ravaged by the bank manager.

Little wonder, then, that the strain of setting up and surviving in the manned guarding business can cause a great deal of havoc when it comes to family life. You have to drop out of attending functions. You forget anniversary dates. You miss the children growing up, and you'll probably be late for your own divorce when it happens!

Consider those start-up costs
For the moment, let's go back to the beginning. Planning doesn't cost any money, and it's fun to think about what you could achieve. It's when the start-up costs begin to hit home that you begin to wonder if you've done the right thing.

Look at what you have to shell out for... Registering the Company and the resultant legal costs. Obtaining accommodation (and probably having to provide all the fixtures and fittings as well). Selecting and paying for a Company uniform. Nobody will offer you financial credit in the early days, so purchasing the basic necessities can be very expensive.

The list of what's needed can go on and on – and you haven't come close to earning a penny yet! The bank overdraft begins to stretch out, but the Bank Manager will not worry. He or she has a charge on your house – and will not be letting it go!

Anyway, let's forget about all those problems and go out and get some business. "I didn't have any problems when I was with that household name a week ago, so why should I now?" OK, but you have forgotten something – the rules have changed. The client, who really liked you before, still likes you – but does he or she really want to put their head on the block? What if your business collapses tomorrow? They're going to look very foolish if it does.

You cannot believe your ears when the client who was your first real 'banker' deal says: "Don't worry, John. You will definitely be on the list when we go out to tender next year". You go home to your wife thoroughly despondent. She's out. The dinner's in the oven. You're left alone with your thoughts and a meat pie.

You say to yourself that things can't be any worse, and wonder whatever it was that possessed you to leave that household name Company, where you were well respected and not badly paid. The trouble is that the agony could go on for three or four years until, in desperation, you sell out with just enough money to pay up your preferred creditors (such as the Inland Revenue and the VAT man).

You try to rejoin the household name contractor – but you're four years older, grey haired and worn out. You are also in deep debt from all the money you originally borrowed, and have lost ground against those contemporaries who were your colleagues just a few years ago.

Anyone who has run their own business – particularly those operating in the manned security sector – will be only too aware of the sleepless nights caused by negative cash flow. You have to pay the security officers today because, if you don’t, there’s ev

You go back to the same pub and gaze again into the bottom of another empty glass.

It was never worth the bother, was it?

The secrets of success
Of course, it doesn't have to be like that. If everyone failed, the industry wouldn't have the unbelievable success stories of men like Jorgen Philip-Sorensen and Brian Kingham to try and emulate. It's highly unlikely that anyone – particularly those operating in today's mature market – is going to come close to their achievements, but there have been plenty of other success stories to give the hopeful entrepreneur optimism for the future.

So how might you go about the task? The rules for success are staring you in the face. First and foremost, you have to keep the overheads so small that it hurts. The salary of £30,000 per annum and the Audi A4 which you accepted as given when working for the household name contractor suddenly turns into £10,000 and a motorcycle. That way of life will be par for the course over the next three years, so you have to put away your ego and work tirelessly for the business.

It may seem obvious, but if you've gone through the pain barrier by dramatically reducing your own personal circumstances, then by definition you'll be ruthless towards all other costs associated with the business. Your Bank Manager will be impressed, and any potential client may give you some small opportunity (even if it's out of sympathy).

Notwithstanding that these draconian measures in themselves cannot guarantee a success, the first 18 months are critical. You need business – not just any old business – and you also need luck. My experience is that most successful entrepreneurs make their own luck.

After approximately 18 months, you will have a tough decision to make – always assuming that you have survived, of course. Do you want to continue to go it alone, or would it be wiser to seek a backer with greater clout? Remember, when you come to sell the company that 15% of something very large is likely to be of more value than 100% of something that's fairly modest.

If you decide to go for it, then you must give it everything. It's no good looking back. To succeed, adopt a partner who you really like and can work alongside. Borrow the set-up financing at the best rates available on the market. Keep the overheads tight. Tirelessly search for business (at all times looking to pick up work in which the household names are not interested). In addition, consider a major backer at about the 18-month point if the business is stabilised and likely to attract one.