With any challenging endeavor, there are a multitude of pros and cons to taking it. Starting a small business is no different, and much of your success will depend on whether you are motivated and determined enough to climb the hurdles and outpace your competitors.
If you are considering starting a Small Business, you may want to keep in mind all the advantages and disadvantages that come with such an enormous challenge. The following is a list of various pros and cons to help you decide whether or not to start a small business:
Pros of Starting a Small Business
• Personal Benefits – Much of the reward from starting a new business comes in the form of personal benefits. As your own boss you have the flexibility to create your own schedule and spend more time doing the activities you love. You will have the independence to work when and more importantly, where you want. You can save money and time not having to commute or worry about scheduling.
• Professional Benefits – You will be able to take more risks and implement ideas at your own pace. You can be far more creative in how you run the business, no longer bound by the restrictions put in place by your employers. This also means that you will reap the rewards of any idea you introduce. At an office, your boss may take credit for your hard work, whereas now you can leverage your ingenuity as part of the legacy you leave.
• Financial Benefits – This can be listed as a pro or con depending on how you view your limitations. Many Small Businesses fail early on, but those that succeed have an almost limitless capacity to earn money. While a normal job may seem more financially stable, it comes with a very low salary ceiling and the potential to be laid off during tough economic times.
Cons of Starting a Small Business
• A Surfeit of Work – As the success of your business will dictate how comfortably you live, you will find you will be working much longer hours than the typical employee, at least initially. Even if the work is something you enjoy, the sheer mountain of labor that awaits you will result in added fatigue, coupled with the stress of trying to make the business succeed. Although you will be paid more for the work you do, it also means you will not get paid for the work you don’t do, such as taking sick days or holidays. Even breaks and lunch constitute more instances where you are not being paid as opposed to if you had a regular job.
• Unpredictable Income – As a Small Business, you will see lots of fluctuation in the amount of revenue you generate. You will have to manage your assets far more carefully, as there will inevitably be lean times where your finances are stretched. You may even have to borrow capital to cover expenses until revenue picks up again.
• Self-Sufficiency – As a small business owner, you will not have the traditional benefits that come with a normal career. You will have to find your own insurance, invest in your own retirement plan, and purchase liability insurance to protect your company from legal claims.
• Staying Ahead of the Curve – With a small business, physical effort is not enough. You will need to demonstrate the mental acuity to stay ahead of your competition, not just in the products you offer, but how you market them. In fact, like many of the cons listed, whether you should start a small business depends on whether you view them as disadvantages or exciting challenges to overcome.