Small Business Ownership - Fact and Fiction
Posted:26 November, 2009 by
Every day in America someone starts a new small business. It may be a doughnut shop, a barber shop, or a home based business. Along with the start ups there are also many failures. Why do you suppose that is? This article will present some reasons both for and against starting a small business.
In 1989, while working as a shipping and receiving clerk for an office supply company in Chattanooga, Tennessee, I began thinking seriously about starting a small business of my own. The problem with my job, of course, was that, like many who start a small business, I felt that I was working hard for my employer, saving him money and all the while not making what I was really worth. I was also in college at the time, married and had three children all under the age of ten.
My wife was a “stay at home” mom and a student herself.
We were living in a mobile home, paying lot rent, and barely making ends meet on my small pay check. I was also doing everything I could on the side to make extra money. This often meant working at night, on Saturdays, and any other time I could besides going to school and working my regular job.
In 1985, when I first moved with my family to Chattanooga, I was asked by a neighbor if I would be interested in cutting his lawn. I agreed to do so and he even gave me the mower to work with. He paid me a whopping $15.00 a week to cut his yard. After doing this for a while, I began to notice that it only took about an hour to mow that lawn. I was making $15.00 per hour mowing, and my job, although it was easier and inside out of the sun, only paid me $4.25 per hour. You can guess what happened.
I started with that one lawn. Then I obtained another and another and another until, within a few months, I was mowing all day on Saturdays and making between $80 and $100 extra money per week on the side. Things at work began to take a turn for the worse and I eventually turned in my notice. At that time, I had nine lawns that I was doing on Saturdays.
At the end of my notice, I went full time in the lawn business. I had obtained a couple of commercial accounts to go with my residential customers and my income soon passed my former amount by several hundred dollars. The business grew to over 40 contracts within a few months. My income went from $200.00 gross per week to around $600.00 per week. I enjoyed my new found freedom, but I found that owning a business has many pros and cons.
So you want to own your own business?
Owning a business, whether small or large, takes a certain kind of person. Not everyone is cut out for it and some people a better off not attempting the task. Here are a few qualities that every small business owner needs to have.
First, anyone who seeks to own a business of their own, must have an adventurous spirit. They must be motivated to explore opportunities as they present themselves. Having an adventurous spirit in the business world means being willing to take a certain amount of risk. It means exploring the possibilities and finding the means to achieve ones goals. This spirit of adventure is basic to the continued growth of any business. It means learning what works and what does not work. That takes some trial and error in limited amounts. Without a spirit of adventure opportunities are often missed and incomes lost.
Second, anyone who seeks to own a business of their own must be a planner. Going into business of any kind without a business plan is risky. It is like taking pot shots hoping to hit the target. Many business fail simply because the owner failed to plan ahead. It is better to have a plan and make adjustments to the plan as you go along, than to go into business not knowing what your goals are. A great man once said, “if you aim at nothing, you’ll hit is every time.”
Third, anyone who seeks to be in business for themselves, must be a people person. A people person is one who can make “the sale without letting you know they are selling you anything.” They sell themselves first and then you buy from them because you have a relationship. A real people person is a servant first and a business person second. The “customer is always right ” is their motto.
The best business owners in my experience are the ones who take time to listen to their customers concerns. They also listen to their employees. They are fair minded individuals who, although they are concerned about the “bottom line”, know that their “bottom line” will be stronger if they treat both their customers and employees with respect and dignity.
The fourth “must” for a prospective business owner is a willingness to invest in themselves and their business. If one does not have the proper knowledge of business principles and book keeping needed to run a business, they should do every thing they can to gain that knowledge before engaging in business. A business person should know their product inside and out. They should be willing to take on the risks involved in purchasing equipment and supplies necessary to operate efficiently.
Fifth, a business owner must be a self starter. Being in business for yourself means it all depends on YOU. If you are not able to, as Larry the Cable guy says, “get ‘er done” then you might better think twice about attempting to business. It takes a “go getter “.
Lastly, a prospective business owner should be one who is able to deal with the stresses of operating a business. Having the mental and physical stamina to handle stress is very important because stress is a part of every business owners life. Equipment failures, employee troubles, bills, customer relations, general maintenance, and book keeping are all sources of stress. Add in the stresses of family life and it can become real trouble. If one is not able to handle stress, all kinds of things can go wrong. Health, mental and emotional problems as well as physical burn out can result.
As a business grows these stresses only increase. When I started my business, a friend of mine also started a lawn service of his own. He printed up flyers and went through a large neighbor hood posting them on mailboxes and front doors. Almost over night his business went from nothing to over sixty clients. He later told me that he had to get a partner and buy extra equipment to handle all of the work . Lucky for him, he was ready. He had spoken to a friend about the possibility of being his partner, planned for an additional investment, and was as ready as he could have been for this explosive growth, but what if he had not been? Can you imagine trying to handle sixty clients in a lawn service all by yourself? What about when it rained? What about snow? I can tell you from experience that would have been very stressful just trying to keep up with the work.
If you’re thinking about going into business of any sort, you should ask yourself if you have these qualities? Are you willing to do what it takes to succeed or not? I’m not suggesting that anyone give up on their dreams, only that you do some soul searching prior to starting a business. Plan to succeed by giving it a lot of thought . Shore up your weaknesses by seeking education and researching your proposed business venture thoroughly. Now let’s look at the pros of being in business for one’s self?
I love being in business for myself - how about you?
Perhaps the biggest “pro” of being in business for yourself is being able to control your own income. When you are in the position of owner / operator you are incontrol of the price you charge for your time and abilities. Working hard and fast, being honest and above board with people, pays off and pays off big when you are the boss. You can actually earn what your worth. Your income is limited only by the availability of work and your own efforts.
A second “pro” is more time with the family. When I had my lawn service and wanted a day off, I scheduled it . If I wanted a long weekend, I could take it. Birthday parties, ball games, dinner with friends, chores around the house, school functions, church, could all be scheduled into my time. The things that were important to me could be worked into my day. All it took was planning. As long as my lawns got done on time, my customers never complained about my taking time with my family. Scheduling and being willing to work a little harder than normal are the keys.
A third “pro” is the pride and satisfaction that comes with the knowledge of a “job well done”. When my customers were satisfied with my work and told me so, it really made my day. My work was my reference. I mean that every customer I obtained from the first to the last, was obtained by referral. I had business cards and I used them but never needed to advertise further. My work was my advertisement. My parents taught me that “any job worth doing is worth doing well” and I tried to practice that in my business. There is nothing more beautiful to me than a well groomed lawn.
A fourth “pro” is the many long lasting relationships that come from being in business for yourself. Many of my original clients from 1989 were still clients ten years later when I sold my contracts and moved to another state. We exchanged Christmas cards and became good friends through the years. The mutual appreciation between us was quite strong and made my work even more enjoyable.
A final “pro” of being in business for one’s self is NOT having a boss to answer to tell you what to do. This does have it’s benefits, but it also means that when something goes wrong, there is no one else to take the heat. If your the “boss” you’re responsible. This is true both with customers and with the authorities.
A business of your own, run in an honest and upfront manner, can be a real blessing. It can bring a real sense of pride and accomplishment to your life. There are a few “cons” to being in business for your self. Let’s look at them.
Every rose has it’s thorns - here come the cons?
Not to throw a wet blanket on any ones dreams, but it would be a disservice to you to only mention the plus side of business ownership without mentioning the down side. It all depends on how you look at it , the following things can be a problem or simply one of the nasty things which are required if you are to succeed in business.
We have already mentioned some of the stresses of being in business. Many of these things, such as those already mentioned cannot be avoided but some can simply by committing to doing everything in your business legally. The rest have to be handled as they arise.
Taxes can be a “con” in owning a business. They make it necessary to keep really good records. If your not one who is meticulous enough to retain receipts and other valuable records in an organized fashion, paying your taxes can be a real hassle, especially if you’re ever audited by the IRS.
Another “con” can be having to have specialized licenses in order to operate legally in your state. Most states require a business license and so do most counties within a particular state. Whether you have to be licensed by the state and county or just the state usually depends on the location of your business. Sometimes you need a city business license as well. You better do your homework or you could be in for a headache.
Lastly, when you’re the boss, you’re responsible for everything right or wrong. There is no one else to blame especially if you are a “sole proprietor”. If you’re not prepared to take on full responsibility for your business, you should not attempt to be in business. Risking a large amount of money, time and effort can be a disaster if you’re not properly prepared. You can lose and lose big.
Remember “if it sounds too good to be true, it probably is.”
In this day and age especially, times are hard. There are many folks out there who are touting many different schemes. Most of these sound good. They promise big income for small outlay. Some of them are legit, but others are only “pie in the sky”. Any offer that promises a “six figure income” for little to no effort on your part is probably the latter .
The only true way to make money is by good old fashioned hard work and persistence. Owning a business takes a great deal of effort. Even the most needed of services must be marketed to make money. Having a good idea is only the beginning. You have to tell someone your idea and be willing to do what it takes to make it fly to turn it into an income. That takes a lot of long hours, hard work , and perseverance in the first few years. Sometimes it pays off and sometimes it doesn’t. It is a chance you take.
The question is are you willing to take the chance and invest in your self? It’s your future. What are you going to do with it? If you decide to take the chance, do your homework first. Keep everything legal. Invest in yourself. Have a plan and work your plan. Set goals for yourself and your business. Take pride in your work and do it right . Be a people person, and don’t ever forget what is really important in life.
