The one good thing about the current downturn in the economy is that it is forcing people to take charge of their lives and explore the reality of their situation. Even though suddenly losing your job can come as a terrible shock in an otherwise ordered life, it can also be an excellent opportunity to make changes and improvements you wouldn’t normally make.

For probably the tenth time this year, I had a fifty-something Japanese male candidate in my office interviewing for job opportunities. At the beginning of the conversation, all I could really do was listen to his stories and give some basic advice – he should drop his salary and job title expectations in the hopes of snaring a job with a smaller company. Of course, this type of advice doesn’t always go over well, and to be honest, I don’t like giving it – it’s depressing.

So with this particular gentleman, who had excellent business experience, I changed tactics and suggested that he set up his own consulting firm. Of course, at first he gave me several reasons why he wouldn’t consider such an option. However, I persisted and reminded him that the odds were stacked against him. To his credit, by the end of the interview he was actively speculating about what he might do and what the actual mechanics of setting up a company might be. Sometimes people just need to be nudged in the right direction – even just to consider their options.

Of course, running your own company isn’t for everyone. It’s risky both financially and emotionally, and it imposes very real physical demands that not everyone can meet. However, a business is very much a creative endeavor and one in which you can sink all your energy – with often very satisfying results. The great thing about older individuals is that they have excellent personal networks – friends they went to school with could now become clients. They also have experience, and have generally managed other people and understand how to grow and look after a team. Finally, they’re realists, and know how to conduct business in a sensible and controlled manner – meaning that they won’t get swallowed up by one of the many sharks cruising by as they get started.

There are many practical reasons for starting your own company – I’d like to list four that come to mind, in the hope of sparking ideas in you, my gentle readersﾉ! The first and foremost is, of course, that you are taking responsibility for your own future into your own hands – no one else is going to be deciding whether you should keep your job or not (at least not until you get bigger and get some shareholders!). This feeling of self-destiny can be really liberating, although a bit scary, to the latent entrepreneur.

The second reason is to tax-structure work you’re doing freelance anyway. I know of a number of contractors who have their own one-person companies so as to manage their tax burdens against the inevitable expenses of operating a company.

The third reason is to actually get work in the first place. There is a strong feeling among Japanese companies, your likely customers, that if someone has taken the trouble and effort to create a company, they must be worth entrusting a project to. Companies radiate a feeling of reassurance and responsibility that individuals cannot.

The fourth reason is for financing purposes. The simple fact in Japan is that companies with a minimum one-year track record can get business loans from banks, while individuals rarely can. As a rule of thumb, you can apply for JPY1M worth of bank loans for every JPY10-15M of sales you are doing, providing you are cash flow positive and seeing even small sales increases year-on-year. If you don’t have collateral, that’s fine, the government has several agencies that will guarantee small business loans.

Most foreign readers may not be aware of the fact that it is actually very easy for foreigners to form their own company here in Japan. This is one area in which there is very little discrimination. Yes, if you’re not fluent in Japanese, you will need someone to read and fill in the various application forms – but the whole process of setting up shouldn’t cost more than about JPY0.5M to JPY1M depending on whether you’re using professional services (lawyers, etc.) or not.

I’ve only briefly touched on setting up a company here. There are lots of good books available on the topic, both in English and Japanese, so I recommend that if you are in the Twilight Zone of job hunting, that you put on your thinking cap and daydream for a little bit about how exciting it would be to run your own businessﾉ

Terrie Lloyd writes a business e-mail magazine every week called Terrie’s Take. You can sign up at www.terrie.com, or by sending Terrie an email directly to terrie.lloyd@daijob.com.