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Boss Blog: July 12, 2017

Starting a Small Business: Pros and Cons

Welcome back to this week’s edition of Boss Blog. This week has been all about small businesses here at Budget Boss. A lot goes into being a small business owner and to be totally honest, you never fully know what you are getting into until you get into it. In today’s post, I am going to go over the pros and cons of starting a small business. As I have mentioned this week, I believe it is the small business that is the backbone of our economy. People who have the courage, determination and work ethic to go out on their own should be celebrated and supported. One thing is for sure is that it isn’t all roses, ask any business owner. You should know the pitfalls and advantages of taking the plunge. Let’s get started and as always the cons will go first.

Cons to Starting a Small Business:

1) It Costs Money

The Kauffman Foundation estimated in 2009 that the average start-up cost was $30,000. Do you have 30K laying around? You also have to think about unexpected costs. I know with my Budget Boss journey every month there are random costs popping up. These days you need a website, social media, print and possibly employees and a storefront. These things aren’t cheap and are very time-consuming. That doesn’t compare to the costs that will come over time with the business. You have to be constantly investing back into the business or you will slip away. Many people think they can turn nothing into a million dollar business. The truth is it doesn’t happen, at least not often.

2) It is Risky and Stressful

If you want safe and stress-free than owning your own business is not for you. Having money saved to put into a business doesn’t mean that there will be a profit. You could go under and many businesses do.  Imagine if you borrowed to start a business. You then run the risk of bankruptcy and your finances being ruined. That is very stressful indeed! The thing is even if you are profitable it will still be stressful. You have to deal with customers needs, which are ever changing. Employees can be very demanding as well. Then there are the things you can’t control like the economy, the local political environment, and buying trends. Having a hard time sleeping working 9 to 5? It only gets worse as a business owner.

3) You will have No Life

I am always amazed at how many hours it actually takes to run a business. 40 hours a week is about half of what you will be doing if you plan on starting a business. 10-12 hours a day, 7 days a week will become standard. Vacations will go out the window. All day, every day will be about business. It is this area that shocks people the most when they go out on their own. They don’t fully realize the dedication and hard-work it takes. Most people are geared for the 40-hour a week life. Time is money and you are going to need a lot of both to get going.

Pros to starting a small business:

1) There is no ceiling

This is the main reason I joined the ranks of the self-employed. I don’t like my potential capped. The idea of my hard work and dedication being rewarded with money appeals me very much. When you work for someone you are always limited by what they are willing to pay you. When you are self-employed you are limited by your intelligence and work ethic. I actually left a very profitable job because I realized I would never make more than what I made there. That was a gross feeling to me. Your creativity will be rewarded by going out on your own. That to me is worth its weight in gold.

2) No more Boss

I will say it again, no more boss!!! When there is no more boss you are now the boss. That is priceless as well. The second you add more people to an equation you then add politics. I love politics but not in the workplace. Our natural instincts are for self-preservation so when you work under someone they logically cannot have your best interests at heart. Having a boss means that you can’t outshine them or outperform them or else you will have to deal with them. The fewer people in between me and my money the better!

3) Passion can be your fuel

I highly recommend starting a business that you are passionate about. Those long hours and that money spent will seem well worth it if you are doing what you love. Let passion be your fuel and money will come. When a business is your vision and your joy you will enjoy every minute you spend on it. When you work for someone else you are contributing to their vision and their dream. Confucius once said, “If you do what you love, you’ll never work a day in your life.” It’s true, believe me.

One of the most fulfilling parts of owning a business is watching it improve and grow. Solving problems and succeeding is a remarkable accomplishment. The reason it feels so good is that the challenges are compounded when you own a business. Everything is at stake. There is no comfort zone. It is in stark contrast to working for someone else where you trade money and responsibility for comfort. Owning a business is not for everyone. Fortune favors the brave. You have to do your homework and come up with the plan, but starting your own business can be exciting and rewarding. It is not for the faint of heart, but it can be something that will make all your dreams come true.

“A dream doesn’t become reality through magic; it takes sweat, determination, and hard work.” – Colin Powell

https://budgetboss.ca/boss-blog-four-cornerstones-financial-freedom/

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Joseph James Francis is a Financial Advisor. You can find him on various social media platforms and at www.budgetboss.ca.

 

 

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