Small business vs big business.
Some people know from an early age they were meant to own their own business. Others find themselves starting a business due to life changes (parenthood, retirement, losing a job, etc.). Others may be employed, but are wondering whether the role of business owner/entrepreneur is right for them.
There are a number of benefits to starting a business, but there are also risks that should be evaluated.
You Are Your Own Boss,+ the bank manager, landlord, partner
One of the best things about owning your own business is that you are in charge. You make all the decisions and call all the shots. Of course, this can be both good and bad, but overall it’s a great feeling to know that you are in control of your own destiny.
Flexibility, + you may need to be in 2 places at once
Another advantage of owning your own business is flexibility. You can work when and how you want, which is a great perk if you have young children or other commitments that need to be taken into account.
Increased Earning Potential & Potential to lose it all
One of the main reasons people start their own businesses is to increase their earning potential. When you work for someone else, your income is usually limited by their willingness to pay you. Despite America’s purported love for small business, the rate of business formation has slowed in recent decades in many places, and fewer startup jobs have been created. The pandemic killed off many small enterprises that just couldn’t stay afloat during the shutdowns, though new entrepreneurial ventures have begun to pop up as well.
But when you own your own business, there is no limit to how much money you can make. After that, the sky’s the limit!
Understanding profit
Profit is simply the income left over after all costs have been paid and is calculated as:
Net profit = Gross farm income – costs
Gross farm income, also referred to as total revenue or gross farm receipts, is typically calculated as price multiplied by production volume sold.
Net profit is gross farm income less all costs associated with production and running the business. Costs include fixed and variable operating costs, allowances for the replacement of livestock, plant and machinery (which may be in the form of depreciation), finance costs (interest, lease costs), management allowances (if a salary is not drawn) and taxation.
Tax Breaks with added costs of tax compliance
Starting your own business also comes with some tax breaks. For example, you may be able to write off certain business expenses on your taxes, which can help reduce your overall tax bill.
Greater Control Over Your Future and your morals
When you’re working for someone else, you are at the mercy of their decisions. If they decide to lay you off or close the business, there’s not much you can do about it. The typical case lobbyists and corporations make is that more rules or bureaucracy will wind up disproportionately hurting places with smaller staffs and budgets. They won’t be able to navigate the system as easily as larger corporations with huge budgets and teams of lawyers and accountants. But when you own your own business, you have greater control over your future and can make changes as needed to ensure your success.
Independence & Responsible
One of the best things about owning your own business is independence. You don’t have to answer anyone, and you call all the shots. This can be a great feeling, especially if you’ve been stuck in a dead-end job for years.
Sense of Accomplishment and sense of loneliness
One of the best things about owning your own business is the sense of accomplishment that comes with it. Starting and running your own business is no easy task. It takes a lot of hard work, dedication, and perseverance. And when you finally achieve success, it feels great knowing that you did it all on your own.
Opportunity to Network or not
One of the best things about owning your own business is the opportunity to network with other entrepreneurs. This can help you learn from their mistakes and successes and may even lead to future business opportunities.
Ability to Take Risks and mindful of risks
When you’re working for someone else, you have to play by their rules. But when you own your own business, you can take risks as needed to grow your company. This can be a good or bad thing, but overall it’s a great way to expand your business and reach new heights.
More Control Over Your Life & more life to control
When you’re working for someone else, you can end up feeling like a slave. You do what they say and when they say it and often have little or no control over your life. But when you own your own business, you have more control over your life and can make decisions that are best for you and your family. To be sure, companies trying to protect their positions is not new — famed investor Warren Buffett has long talked about the importance of firms creating an “economic moat” around themselves as a way to stave off competition. But many of the tricks and strategies companies employ to get there are quite ugly and unfair and really tip the playing field.
Increased Job Satisfaction with glee
When you’re working for someone else, it’s easy to become complacent with your job. You may not like it, but at least it pays the bills. However, when you own your own business, you’re more likely to be satisfied with your job because you’re doing what you love.
Pride In Your Work and pride of yourself
When you work for someone else, it’s often difficult to take pride in your work. You may not feel like you have control over what you do or how it turns out. But when you own your own business, you are the one in charge and can take pride in knowing that everything is under your watchful eye.
Increased Self-Confidence and Self-Worth
Starting and running your own business can do wonders for your self-confidence. When you’re in charge of a company and everything that goes with it, you have to be confident to make the right decisions. This confidence will carry over into other areas of your life, making you a more well-rounded individual. In addition, you become more independent and confident, which leads to a better overall quality of life.
Opportunity To Make A Difference, sometimes only small
When you’re working for someone else, chances are you’re doing something that doesn’t really matter in the grand scheme of things. But when you own your own business, you have the opportunity to make a real difference in the world. You can help people, make a difference in your community, and change lives for the better. Banks are constantly telling us how they love to work with up-and-comers and help get entrepreneurs on their feet. But as we saw with pandemic-related small-business loans, many were much more eager to help out larger operations and businesses they already had relationships with.
Greater Flexibility In Your Work Schedule & Life Schedule
When you work for someone else, chances are your work schedule is pretty rigid. You have to show up at a certain time and do your work, and there’s not much flexibility. But when you own your own business, you can set your own hours and work as little or as much as you want.
Increased Job Security needing increased determination
When you work for someone else, your job is never really safe. You could be laid off at any time for any reason. But when you own your own business, you have greater job security because no one can fire you without good reason. There are a host of reasons that could contribute to fewer new business startups, from investment trends to cultural changes to student debt. Running a company is hard, and it’s easy to fail. About one in five small businesses in the US fail in the first year, and half fail within five. But part of the issue is also corporate concentration and consolidation; the bigger players make it harder and harder for smaller operations to stick around.
Ability to Retire Sooner, or not ….
Working for someone else usually means working until retirement age – or sometimes even longer. But when you own your own business, you can retire sooner since all of your income comes from your own business.
Increased Opportunities for Promotion, YEP
When you work for someone else, the opportunities for promotion are usually pretty limited. But when you own your own business, you can promote yourself to any position you want. You’re in charge of your own destiny!
Ability to Pass Your Business on to Your Children or just sell
When you work for someone else, you usually can’t pass your job down to your children. But when you own your own business, you can pass it on to them, and they can continue running it after you retire. This gives them a huge head start in life and ensures that the family business will live on for years to come.
If you’re a growth-oriented business right now, the pathway seems to be that you either become a monopoly or you get acquired by one.
Big corporations become gatekeepers and set their own rules of the road
Some consolidation within industries is a natural part of maturing, but the process has sped up in recent years. An increasing number of industries — from airlines to beer to hospitals — are controlled by just a handful of players. We often focus on what this means for consumers, and antitrust law generally looks at what consolidation or monopolization means for prices. But what sometimes gets lost in the conversation is what it means for the other companies trying to get a foot in the door or survive.
All entrepreneurs and businesses should have access to markets to launch and grow new businesses, but today — and the way markets are structured — dominant corporations are a major barrier. That is one of the reasons we’re seeing entrepreneurship and small business growth declining.
There are many benefits of owning your own small business, including independence, a sense of accomplishment, the opportunity to network with other entrepreneurs, the ability to take risks, more control over your life, increased job satisfaction, pride in your work, increased self-confidence, and opportunity to make a difference. So if you’ve been thinking about starting your own business, now is the time to do it! But, don’t wait any longer – the rewards are too great to ignore.