Why Everyone Should Have a Small Business?
I believe that everyone should have a small business at the least! But Why?
If you read the biography of some of the richest people in the world, you will undoubtedly come across a business that is associated with them. I am yet to read about a rich person who got rich from just being an employee, although there are many high income employees.
Employee income is the highest taxed income, and the more income you receive, the more the taxman takes. This is why rich people believe in entrepreneurship, they know that entrepreneurs pay less taxes, and that a higher income doesn’t necessarily mean more taxes are paid; it all depends on the amount of expenses incurred to generate the income.
Starting a small business is the dream of many people. However, the fear of the unknown often prevents them from taking the big plunge to realize this dream. How can you overcome that fear to execute that great idea you have to impact you, your loved ones and the many other lives that you want to?
Napoleon Hill said: “Whatever the mind can conceive and believe, the mind can achieve.” The great book says: “Faith without works is dead.” I believe the combination of faith and taking action are the key ingredients to help you to overcome that fear to bring your idea to fruition. And while there is a lot more that is required once you embark on the journey to become an entrepreneur, it is definitely not so difficult that it can’t be done.
To make your dream of starting a business a reality, it’s important to understand what it takes to make it happen. You need to be truthful with yourself when thinking about starting a business. And there are a few questions that you may want to answer before you start investing your time into something that may not last:
- Are you able to motivate yourself if you don’t have a boss to answer to?
- Are you willing to work more hours than you ever did at a job?
- How will you come up with the money to get started?
- How much will you need?
- What type of business will you start? Why?
- Do enough people need what you’re offering to keep you profitable?
These are only a few of the questions you must answer and they may be tough questions, but answering them is worth it because it means you are on your way to fulfilling your entrepreneurial dream.
But why go through the hassle?
The truth is that most people never will. They will run back to the comfort of the known — their 9 to 5 day job — as soon as they encounter anything that even remotely resembles an obstacle.
And don’t get me wrong, there are real obstacles, and real risk, but how you handle them will determine how successful you are. Small business owners aren’t special in that they get lucky or that nothing bad ever affects their business. They are special because of the way they think and approach the problems when they do come up.
Starting a small business takes planning. You will need to have a fairly in-depth plan, but it doesn’t need to be perfect. The best you can do is make a plan based on your present knowledge of the business you would like to start. But what you know now may be quite different from the way things really are. For that reason, it’s okay to change some parts of your plan when you learn more. However, you shouldn’t make changes lightly, and you should always have a good reason for doing so.
What are Some of The Pros and Cons of a Small Business?
There are a lot of rewards that go along with having a small business. Below are a list of some of the perks to owning a business:
- Job satisfaction, assuming your business is in something you like or enjoy doing.
- You will be your own boss, so you get to decide what you do, when you do it, and how it will be done.
- You will be able to make as much money as the market says your business is worth.
- There’s no need to beg your boss for a raise.
- You pay taxes on the profit instead of on the total income/revenue.
- You set your own schedule, so if you want to get up at 11:00 in the morning or take a week off, then you don’t need anyone’s permission to go for it!
Those rewards are very real, but…
You have to get to the point of running a successful small business first. You also need to be sure your business is functioning well if you want to get up late or take a few days off. But it can be done if you keep committed and build your business before you start taking out money!
The mistake many small business owners make is that they start to pay themselves from the business before it starts to turn a profit. This often happens because they fail to keep track of all their expenses properly, and for this reason they don’t calculate the profit accurately.
Profit = Revenue – All Expenses 😁😁
Sometimes small businesses owners overlook small expenses but over time they can add up. For instance, when we just started our real estate business, I would overlook expenses like the stationaries, printer toner, hand towels, paper towels, hand soaps, toilet paper, air freshener and other cleaning stuff that I would just take from my home to prepare the rental home for renting. Initially it wasn’t noticeable but after preparing several homes for renting, it became noticeable when my linen closet was scant with hand towels.
Like everything else, there are some disadvantages to owning a business that you must also consider. These include:
- The burden from being fully responsible for the running of the business
- More time commitment – Longer work hours are required than a 9 to 5 job.
- Financial Risk – The start up cost may be high and you have to take on the financial burden.
- Less time for family and social activities – Lots of time for especially the building phase.
Despite the disadvantages associated with small business ownership, many small business owners, myself included, are happy and satisfied with the decision to become a business owner. In fact, 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.
In my case, if I didn’t have a small business, I would not be able to take advantage of the Canadian Emergency Business Account (CEBA) interest-free loan of $40K that the Canadian government extends to small business owners for 2 years to weather the storm of the Covid 19 pandemic effect. Once I repay the loan at the end of the 2 years, I get to keep $10K for my business.
If all pans out well, this will be the first time I receive any money from the government, despite the high taxes me and my husband pay each year, since we are both six figure income earners at our day jobs.
Living life on your terms and having more free time may be the reason you want to own a small business. So initially it may seem counter to your plans since you’ll be working more hours and performing more duties like book keeping and the hiring and firing of employees for instance.
Eventually you’ll get to living life on your terms but it’s going to take some effort to get to that point. Plus it will be more than worth it when you make your dream a reality….you just have to remain committed, adhere to your plan and delay your gratification.