going into business for yourself Has Pros And Cons read on for details
You've determined that you have what it takes to be an entrepreneur and you're itching to get started. But are you really aware of what you are getting yourself into?
Being an owner of a small business is very different from being an employee in one.
That is why it is wise to learn the pros and cons of small business ownership to help you decide if you are really ready to jump in with both feet.
How Small is Small?
There are many different kinds of small enterprises and ways to operate and own them.
The usual consideration for deeming a business “small,” is that it has to have fewer than 100 employees in the U.S., and fewer than 50 in Europe.
Employee size is not the only thing that defines what makes a small business, as other criteria include annual sales, asset value or net profit.
The smallest businesses are called micro businesses, and they are often located inside someone's home.
Both the U.S. and Europe defines “mom and pop” businesses, where the operation is almost entirely run by the owner's family, as businesses that have less than ten employees.
With the Good Comes the Bad
Owning small businesses has many advantages and disadvantages. The owner must decide if the advantages outweigh the disadvantages when looking to open and run their small venture.
Pros of Small Business:
Your Own Boss: You will have the chance to work in a field that is of interest to you.
You will make the decisions about your business. You will decide on the best location, suppliers, products, relationships, etc.
It puts you in control of everything from start to finish. Your success is up to you.
Hands On – You will be involved in every aspect of your business from marketing to filing to customer service. You will gain experience in many different areas of business.
Financial Freedoms – You will have the opportunity to grow your business into something that does not limit your income.
You will even be able to build retirement value. Keep in mind, that this may not be true initially.
Cons of Small Business:
Financial Risk: In order to start a business, you will have to invest money.
Since many small businesses fail, your investment is at risk. There are no guarantees.
No Steady Source of Income: Unlike being an employee of a company, you cannot count on a paycheck every 2 weeks. There may be times when there is no income coming in at all.
Time and Effort: It takes a lot of time to start a new business. It also takes hard work.
Before starting, you will need a business plan, financing, suppliers, equipment, space, and more.
Once you get the business up and running, you will then need time to find customers. These are not tasks you will be able to pass on to others.
Knowing the pros and cons of a situation is the best way to determine what is right for you. Now that you've weighed the pros and cons, you will have to make a decision. Is it worth it?
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