Pros and Cons of Starting a Small Business
Part 2 of Acey Gaspard’s Guide to Starting a Small Business – Made Simple
Owning your own business can be one of the most rewarding experiences in your life. Like all good things, there are pros and cons.
Owning and operating their own business is the only way for some people. For others, a job could be a better option.
Let’s look at the pros and cons of starting and running a business for those who lean towards becoming business owners.
Let’s look at the pros and cons of owning your own business. These are some of the main points that will help you better understand what’s involved.
The Pros of Starting a Small Business
You’re the Boss
When you’re running your own business. No one can tell you what to do. It’s your company. Run it any way you want. You don’t need to please the boss. You are the boss.
Note that even though there is no direct boss to please. You do have to please your customers.
You’re in control of Decisions
It’s your business, and you can decide as you see fit. You don’t have to get approval. Do what you think is best and take action. You may want to consult with qualified people for those big important decisions from a different perspective.
You Have Control Over Your Working Environment
You can set up the work environment as you see fit. It’s important to ensure your workplace is laid out correctly with the right conditions when possible.
For example, you want the layout to allow for a good workflow. You want the temperature set for optimal performance. You want to make sure you have great lighting, etc.
When you’re in charge, you set up things the way you want and streamline operations as you see fit.
Work Your Your Hours
You may be able to work your hours depending on your business type. For a business like a retail store, you can’t work your own hours, but a business similar to graphic design would allow you to work any hours you want.
Looking at working hours from another perspective, if you have employees, you would have more freedom with what and how many hours you work.
You have No Limits on Your Success.
How successful you’ll be will depend on your business and marketing skills. You have no limit as to what can be done. Your boss does not hold you back; you don’t have to compete for a promotion. Your success depends on you.
No Limit Income Earnings
The amount of income you can earn is unlimited. There is no cap on your salary; the only thing that can hold you back is your skills, dedication, and how you manage and market your business.
You Can Hire People to Perform the Tedious Jobs
There will always be jobs you don’t like or can’t do yourself. Even though you don’t want to deal with them, they must still be completed.
The good news is that your business is operational and gaining traction. You can always hire someone to perform those jobs you don’t want.
It’s Prestigious To Own a Successful Business
Depending on the amount of success you’re experiencing, it can be very prestigious to own your own business. You can be proud of it and discuss it with friends and relatives.
Being successful feels good. It’s nice to share your success with your friends and family without bragging.
Your Experience Is Interchangeable
The knowledge and skill you learn when running a business can be used in other areas. For example, as you develop your management skills, you can use them in your personal life and the future for other ventures.
You Have More Freedom
Naturally, you’ll have more free time when you’re running your own business unless you’re doing everything yourself. This could be the case during the startup phase. Still, once your business starts to gain traction and become successful, you can hire people to help you out, giving you more free time and allowing you to live the life you want.
Free To Be Creative
As a business owner and the one in charge, you are free to unleash your creativity. You’re not bound to do things as you would as an employee. There is no boss to give you approval for projects.
Naturally, improving the amount of money you earn is one of the key benefits of owning your own business.
Your financial situation in the early stages won’t be as profitable as when your business is established, strong, and performing well. Reaching that stage will take time and effort, but once you’re there, all your hard work can be worth it.
The Cons of Starting a Small Business
Problems Are Your Responsibility
Problems occur at work. It’s a given! When you’re an employee, some of the issues may be your responsibility. Still, you always have a boss. Ultimately, it’s your boss’s responsibility to deal with the issue.
As a business owner, you are the boss, and dealing with the problems is up to you. There’s no one higher up to go up to. It’s all on you.
Start-Up Phases Can Be Difficult
Starting a business can be one of the most stressful times. There’s a lot that you can’t see during the startup phase. There’s a lot to do, and you don’t have a lot of direction. If you complete everything correctly, it will pay off. A few bad mistakes during the startup phase can cost you dearly.
You May Not Get Paid Regularly
As an employee, you can expect a regular paycheck. As a business owner, especially during the startup phase, you may have to kiss that regular paycheque goodbye. Money flow is one of the most important things that keep the business alive.
There is no money coming in during the startup phase. Even when you open your doors, it may take some time to depend on a steady cash flow. During those times, it doesn’t make sense to get paid when you need those funds to keep your business going, and you may have to wait until a better time to get paid.
Another example where you may not have the funds to pay yourself is if you’re in a slow season or the market slumps.
You May Have To Put in a Lot of Extra Hours
As an employee, you put in your eight hours, go home, and are done for the day. It doesn’t work that way as a business owner, especially in the early stages.
Unless you have employees, you must put in those extra hours to complete those important tasks that keep your business running.
The overtime you put in is not paid directly. You’ll reap the rewards when your business becomes successful. You’ll have to put in the extra time because there’s no one else to help. It’s your responsibility to ensure those tasks are completed.
Pressure To Succeed
There’s pressure to perform. If you don’t, you could be out of business quickly. As an employee, you’re responsible for completing your work. Your bosses are responsible for ensuring that your work is completed correctly and the department runs smoothly. As a business owner, it’s up to you to ensure success, and that’s not an easy thing to do
A Substantial Investment Is Usually Required To Get Started
There are many businesses you can start that are low-cost such as an online or part-time home business. Others require a substantial investment. Depending on the business, you may need funds in the six-figure range just to start.
Change Is Always Happening
Markets, products, customer expectations, and services change. You must adapt quickly and effectively. Failing to do so can easily put you out of business. The world moves faster due to technology, and keeping up with all the innovations is hard.
There Are No Guarantees That Your Business Will Succeed
Owning and running your own business does not guarantee success. If you look at statistics, many businesses fail in the first few years.
And that can be scary.
To improve your success rate, you can research your business idea. Research the market to ensure people want what you offer—Research the competition to identify supply and demand. You can also get advice from qualified people to ensure you’re on the right track. Assess the risks before moving ahead.
There Are Risks in Running a Business
You never know what might happen. As a business owner. The market may dry up. There could be a pandemic that keeps you closed for months on end. You may lose a key supplier you may be hit with a lawsuit.
You can’t get too comfortable once your business is established. You always have to be one step ahead and anticipate possible problems. Business is risky. It always has been.
Your Pay Is Based On Your Performance
As an employee, you are paid by the hour or a salary, and if the company does well or not, your pay is stable. As a business owner, your pay is based on the performance of your business. If the business is doing well, you can afford to pay yourself more; if the business isn’t doing well, your paycheck will be affected.
Whether owning and operating a business is right for you it’s your decision, and you’re the only one qualified to make it. Take time to research and consider what’s best for you.
I once heard a saying that I liked it. I believe it was from John Maxwell: “You can live your life any way you want, but you can only live it once!”