There are many reasons why people want to own their own businesses. Starting a business can be very profitable. However, it can also be very stressful and frightening. You would have to take a leap of faith and bet on yourself. Failure at owning a business has less of a safety net than working a 9 to 5 with another company. If you are considering starting a business, here is a guide to the pros and cons so that you can make an informed decision and go forward with your eyes open.
Pro: Be Your Own Boss
Being your own boss is probably a very attractive part of having a business. There is no one to answer to but yourself. Don’t like the hours of work? You can change them. Think you should move in a different direction? You can do that without having to consult with multiple people who resist change. You could have control over everything in your company, and make it function in a way that works for you. The problem with working a regular job is that you have very little control over your situation. Owning your own business gives you the power back.
Con: More Risk
Owning a business means that you are responsible for anything that happens within it and because of it. Your staff are your responsibility, your property is your responsibility, and your success or failure are your responsibility, too. This can be frightening for many people. There are steps you can take for protecting your small business, such as having the right insurance coverage and hiring the right people. In the end, though, you will be closely connected to your business, and all of the responsibility will fall on your shoulders.
When you own a business, your potential earnings essentially have no limit. You could end up making more money than you’ve ever dreamed of. When you work at a job, your earnings will be capped based on what your company pays. Sure, you could get promoted over time, but with a pyramid structure of hierarchy, there will only be so many opportunities. Plus, the potential of your business earnings far outweighs the potential of being a manager or executive at another company.
Running a business, especially a small business, can take up massive amounts of time. The goal is always to maximize your profits while minimizing your costs. That means that a lot of small business owners take on more than they should while they are getting established. They miss their kids’ milestones, cancel spending time with friends, and lose a lot of sleep. If you are not prepared to spend the time you need to get to where you want to be, then being a business owner can be tough.
Pro: Do Something You Love
Let’s face it, there are very few 9 to 5 jobs that people are passionate about. If you have one of those, then you are very lucky. However, if you own a business, you can do whatever you want to make it the job of your dreams. Your working years will go by much faster if you are doing something about which you are passionate. Sell vintage t-shirts, or repair computer equipment, or try to make money at any other hobby you have. Life is short, and if you feel that your regular job isn’t making you happy, then taking the plunge could be just what you need.
Con: Difficult Decisions
As the saying goes, “heavy is the head that wears the crown.” The reason for this is that the king will have to make many decisions that are very difficult. As the owner of a business, you will have to make tough choices that could affect your staffing, strategic plan, and investment targets. With so many decisions to make, you can feel overwhelmed. However, you can’t avoid making them, so make sure you are up to the task before you try it.
Owning a business is much like owning a house. You want to buy it (or start) it at one level, and eventually sell it at another. Owning a business can provide the opportunity for a tremendous amount of equity. As soon as you get a business running smoothly, you can sell it to get a down payment to buy another one. Employees have no such opportunity. The only way to get value out of a small business is by owning it.
Con: Lack of a Trainer or Coach
When you are an employee of a company, you will undergo training and be provided with regular instructions and advice. You might take these for granted, but training and coaching provide a valuable service. As an employee, you always want to make sure that you are doing what you are supposed to in the appropriate manner. When you start a business, you have to make sure you know all of the details and tasks that need to be done to keep you afloat. There may be nobody to help guide you and make sure that you are doing the right things. Coaching and training will help not just with your current job, but also with any changes you want to make down the road.
Pro: Commitment to a Community
Starting a business means that you are committed to your location for at least the near future. You can build connections with others in your community and be a part of the fabric of your city or town. You can feel like you belong, and you can provide assistance to charities and other helpful organizations in your hometown. For many business owners, this is what makes them so happy about owning a business.
Owning a business isn’t for everyone. There are several things to consider when you are struggling with whether you should give it a shot or not. Use these pros and cons to get the information you need and make an informed decision.
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