Are you considering becoming a business owner? You might want to weigh the pros and cons first (Small Business Development Center, 2006). The advantages and disadvantages of business ownership should be carefully considered before making the decision to become a business owner (Small Business Development Center, 2006).
Advantages of Small Business Ownership
As the little boy said when he got off his first roller-coaster ride, “I like the ups but not the downs!” Here are some of the risks you run if you want to start a small business: Financial risk: The financial resources needed to start and grow a business can be extensive.
You may need to commit most of your savings or even go into debt to get started. If things don’t go well, you may face substantial financial loss. In addition, there’s no guaranteed income. There might be times, especially in the first few years, when the business isn’t generating enough cash for you to live on.
As a business owner, it’s easy to feel like you’re constantly under pressure. You have to worry about things like competition, employees, bills, equipment breakdowns, and customer problems. And on top of all that, you’re also responsible for the well-being of your employees.
It can be tough to find the time to spend with your family when you’re running a business since it requires so much time and commitment. You might feel like you don’t have the freedom to take time off, even though you technically should be able to.
Being the business owner comes with a lot of stress because you are the business. You have to worry about things like competition, employees, bills, equipment breakdowns, and customers. And not only that, but you’re also responsible for taking care of your employees.
This can be a lot to handle! Time commitment is another thing people have to think about when starting their own business. Many people want to start their own business so that they can spend more time with their family. But in reality, running a business takes up a lot of time. Even though you technically have the freedom to take time off, there may be times when you can’t get away.
When you first start your business, you’ll likely be responsible for completing or overseeing every task that needs to be done.
This can become overwhelming very quickly, especially if you don’t enjoy some of the more tedious work. Unfortunately, as a business owner, there are some less than desirable duties you’ll have to perform from time to time – like firing employees. While it’s not the most fun task, it is necessary in order to keep your business running smoothly.
In spite of the disadvantages, most small business owners are pleased with their decision to start a business. A survey conducted by the Wall Street Journal and Cicco and Associates indicates that small business owners and top-level corporate executives agree overwhelmingly that small business owners have a more satisfying business experience. Interestingly, the researchers had fully expected to find that small business owners were happy with their choices;
- Running a business successfully has several great advantages:
- You get to be your own boss and have independence in your work.
- You get to choose when and where you want to work, giving you a lot more control over your lifestyle.
- There’s a higher chance of financial gain and rewards, even though there’s also a higher risk.
- You’ll have plenty of opportunities to learn new things since you’ll be involved in all aspects of the business.
- You also get creative freedom and can find personal satisfaction in your work.
There are a few potential disadvantages to think about before deciding to start a small business, such as:
- The substantial financial risk and loss you may face if things don’t go as planned
- The stress that comes with managing a business, including worrying about competition, employees, bills, equipment, and customers
- The great time commitment required to successfully run a business (it’ll probably consume most of your time!)
Cicco and Associates Inc. conducted a study on type E personalities and found that entrepreneurs are generally very satisfied with their lives. However, running a business can be very time-consuming and exhausting, so it’s important to make sure you have a good work-life balance.
The Small Business Development Center also has a few articles on the pros and cons of owning a business, which might be helpful for you to check out as well. According to Cicco and Associates Inc., entrepreneurs report high levels of satisfaction with their work. However, owning a business also has its challenges. The Small Business Development Center lists some of the pros and cons of owning a business:
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