A Guest Post by Jason O’Leary
According to the U.S. Small Business Administration (SBA), there were 30.2 million small businesses in the U.S. last year, making up 99.9 percent of all businesses in the nation. Small biz entrepreneurs are to thank for some 60 million jobs, with 1.9 million new ones added each year. With such impressive numbers, it almost seems like starting a business would be easy. In truth, though, embarking on such an endeavor is the challenge of a lifetime, and one that’s surrounded by many misconceptions. Here are some of the most common fallacies of business ownership that you should consider before cutting the ribbon.
#1 You’ll Be Your Own Boss
Unfortunately, you’re not guaranteed complete freedom just because you break free from corporate life. To start your own business, you’ll trade up a traditional boss for other types of bosses, like your clients, your investors and your employees who rely on you. Many budding entrepreneurs also hope that branching off on their own will mean less pressure. In truth, since you’ll be the head honcho, the pressure will always fall on you, and you might feel even more pressure than you did when you worked as someone’s employee.
#2 You’ll Have No One to Lean On
Entrepreneurs often adopt a lone wolf mentality when starting up their own business. In part, it’s a defense mechanism, since relying too much on others could be detrimental to your business if things go wrong. In reality, though, the best and most successful entrepreneurial endeavors are the ones that are a team effort. You should make sure to build a support system around you, with reliable employees and people to consult, so that you always feel like you can take a step back if need be. You’ll also have your local small business agency and fellow business owners to lean on.
#3 All it Takes Is Hard Work
It takes blood, sweat, tears and bootstrapping, right? No doubt about it—you won’t get far if you’re not willing to put in the work. But hard work isn’t all you need. You also need enthusiasm, sensibility, the fortitude to get through the logistics and red tape and, perhaps most importantly, money. When they say businesses are fueled by passion, they mean in addition to cash. You’ll need it for everything from incorporating to obtaining the right licenses and bonds to funding your first project. Unsurprisingly, 82 percent of failed businesses report poor cash flow for the reason they flopped. Sadly, hard work simply isn’t always enough!
#4 People Will Immediately Support You
For you, announcing the launch or expansion of your business is huge news that should be celebrated, but know that not everyone will immediately jump on board. It takes new businesses months, and even years, to prove their reputability, so don’t expect the whole community to rally around you from the second you open your doors. This is especially true for service-based businesses, such as general contractors, electricians, housekeeping services, etc., since they tend to excel in large part due to reputation and recommendations.
#5 There’s a Simple Formula for Success
If there was, do you think people would constantly be citing that statistic saying that half of all new businesses fail? In truth, according to the SBA, only about 20 percent of small businesses fail the first year, but only about half survive past five years. The takeaway? There’s no easy way to succeed in business, or else all start-ups would. The businesses that prosper are the ones that have found their own special sauce and are operating in the right market at the right time.
#6 There’s No Need to Plan
Forecasting your sales, market demand and how your product or service will be received can be tricky business but understanding things in depth before you make big steps can save you a lot of trouble in the long run. Far too often, companies skip the market research and the testing, leaving them perplexed when things don’t go over as planned. If you have to cut corners, don’t do it here. The experts say that putting in the right amount of pre-launch research can save you big over time.
#7 You Can’t Learn Business Sense
Contrary to popular belief, entrepreneurship isn’t intrinsic. We’re all born with the equal ability to start a business, but some people are molded into entrepreneurs at a much younger age than others. It’s important to remember that you should never stop learning and that you can always learn more. Look at every opportunity as a chance to learn and don’t be discouraged if you feel like you have a long way to go.
#8 You’ll Have No Free Time
All smart, new business owners must go into their new endeavor knowing that they are entering into a job that functions around the clock. Your neat eight-hour workdays will soon last 24, and it can be taxing if you aren’t used to it. But it’s important to remember that taking time for yourself is good–not just for you, but for business. You can, and should, build in time for yourself, especially after the first year when things are up and running smoothly.
Is Starting a Business Worth It?
With all of this taken into account, you’re probably asking yourself whether it’s even worth it to take the great, big leap into free enterprise. Sure, it’s hard, but consider that entrepreneurs are consistently among the most satisfied workers in our economy, with survey after survey showing that they’re the happiest at work. There’s a lot of joy and satisfaction that comes with hard work, so don’t let the long and bumpy road ahead scare you off.