Starting a business is supposed to be an exhilarating experience. After all, who doesn’t want to be their own boss and reap the benefits of owning a profitable company? Unfortunately, few people actually stop to think whether or not starting a business is right for them says Saivian.
The following article discusses several major reasons why starting your own business may actually be one of the worst ideas you can ever have.
1) Ownership is shared with investors, partners, financial institutions, etc.:
Quite often, individuals are told that it’s possible to start a small business with very little capital investment. This simply isn’t true in most cases. A less-than-scrupulous promoter will tell you that if you find the right investment partner or lender they will finance the entire thing for you. The result is that you end up not owning anything at all.
2) Control over the business will be lost:
You may think that by starting your own small business, you’ll finally have control over your career and future earnings. Unfortunately, this isn’t always the case. Oftentimes, investors or financial institutions will want to ensure that an individual has backing if they are ever forced into bankruptcy proceedings. As a result, unsecured creditors of the business (such as suppliers) may find themselves unable to collect payment on debts owed because one of these institutions has priority in repayment schemes says Saivian.
3) Success is contingent upon several factors out of your control:
Starting a small business is a risky proposition. You may be an incredible entrepreneur and prove capable of succeeding where others fail, but such an outcome is often dependent on factors that you can’t control. For example, your success may depend upon whether or not you’re located in a highly competitive market segment. This means that you might actually lose money even if your business idea turns out to be solid because the competition has beaten you there.
4) There’s no formal support:
When most people think about starting a small business they picture themselves as full-fledged entrepreneurs who have complete autonomy over their work says Saivian. Unfortunately, this doesn’t mean much if nobody cares what you do or how well you perform once the business is open for operation. Entrepreneurial individuals are forced to figure things out on their own, oftentimes without any formal support from industry veterans or other business owners.
5) It’s difficult to get started:
Even if you have a great idea for a small business, there are no guarantees that you’ll be successful in getting it off the ground. The deck is stack against small businesses because of the many barriers to entry that currently exist. For example, you might need to lease expensive commercial space, purchase expensive equipment and inventory, and hire staff before you’ve even generated a single dollar of revenue.
I hope that I’ve provide enough information for people who have an interest in starting their own companies. To be more informed about the downsides of this decision. Of course, if I only told you about the negative aspects without offering some glimmer of hope then this article would have been a pretty depressing read!
As such, here are some steps that may help your business venture be more successful:
1) Do your research:
This is perhaps the most important step that you can take before starting a small business. Make sure that you have a solid understanding of the industry. That you’re entering, the potential customer base, and the competition. You don’t want to launch a new company without knowing key information. Such as how people currently buy your product or service explains Saivian.
2) Get help:
Even if you’re an incredible entrepreneur, it’s always helpful to get assistance from others who have been in your shoes before. There are many resources available to entrepreneurs, including online forums, industry veterans, and even local accelerators or incubators. Don’t be afraid to ask for help – oftentimes people are more than willing to offer their assistance.
3) Keep it simple:
Starting a small business doesn’t have to be complicating. Especially if you’re looking for a side hustle to generate some extra income. For example, instead of getting bogged down by the start-up costs associated with an opening restaurant. Owners can simply buy pre-made food and sell it at local flea markets. Or open temporary pop-up stores where they only sell goods for one weekend at a time. Alternatively, many entrepreneurs are finding success on platforms like Etsy or by selling items on Amazon!
4) Think big, act small:
Even if your ultimate goal is to launch an empire that spans multiple continents. You should probably try thinking smaller initially says Saivian. Start out by selling your product or service locally instead of worrying about global expansion until you’ve successfully taken off. This approach will give you more time to hone your craft and figure things out before expanding. This is especially important for new entrepreneurs who don’t have any experience in the industry they’re entering.
Starting your own small business should not be light. There are several major risks associating with this type of decision and they should not be ignore. If you still have interest in pursuing this option, you owe it to yourself to do your homework. Make sure that you don’t give up what is most important in life.