Learn about the top 20 pros and cons of owning a business and be smarter when deciding whether you want to start a small business or not.
For many people, entrepreneurship is a very attractive career path.
According to research by SBA, about 600,000 new businesses start up every year.
And more than 1.5 million new businesses were started between 2015 and 2018.
Obviously, there seems to be some sort of attraction.
That makes people want to start a business.
However, many “experts” caution people from owning a business.
Citing the failure rate of small businesses.
As a reason not to start a business.
In this article, we bring you a balanced view of owning a business.
By examining the pros and cons of going solo and becoming an entrepreneur.
Table of contents:
Introduction: why do people want to start a business?
Top 20 Pros and Cons Of Owning A Business:
Why You Should Own A Business:
- You Get Independence
- You’ll Have Flexible Working Hours
- You’ll Gain Influence
- You’ll Have Full Control Of Your Life
- You Can Get Good Financial Rewards
- You’ll Have Learning Opportunities
- You’ll Express Your Creativity
- You’ll Have A Sense Of Achievement
- You’ll Have Job Security
- You’ll Get To Help People
Why You Shouldn’t Own A Business:
- It’s Hard To Start
- You’ll Have To Invest Money
- You’ll Invest Long Hours In It
- No Income Guarantee
- You’ll Manage Clients Support
- You’ll Have To Change Fast
- You’ll Have To Learn A LOT
- You Might Wait A Long Time Until You’ll See Results
- You’ll Have Stiff Competition
Let’s get the ball rolling.
Why You Should Own a Business
Here’s a look at all the good reasons you should think of owning a business.
#1 You gain Independence
Entrepreneurs are generally people that like to be in control of their lives.
And make decisions about their lives.
The typical “Type-A” personalities.
Owning a business helps them fulfill that part of their lives.
By owning a business.
You save yourself from having to work for any other person.
As an entrepreneur, you get to sit in the driver’s seat.
And determine the company’s culture.
You’ll be the one making the decisions.
And you know how best to direct your company’s future.
While it might sound intimidating at first.
You can use your skills and experience.
To build a brand and organization with a specific culture.
Besides, you are in control of your income as a business owner.
This is very important.
Because, as an employee, your livelihood is dependent on someone else.
This means a layoff can put your finances in jeopardy.
As a business owner.
You enjoy a higher level of independence and security.
When it comes to your finances and your life.
#2 You have Flexible Working hours
Probably one of the most popular points.
That advocates of running your own business will mention.
You can work from anywhere that you wish to.
And set your own working hours.
In addition to this, you are responsible for setting your priorities.
Many people find this attractive.
Because conventional work hours can strain your work-life balance.
As a business owner, you can choose how you want to spend your time.
Allocating it to the things that matter to you.
This is especially helpful for women who wish to have a successful career.
And still, be involved with raising a family.
According to Women Business Owner Statistics, women own over 11 million businesses, which generate a combined $1.7 trillion in sales.
#3 You’ll Gain Influence
As a successful business owner, you become more influential.
Running a business gives you the opportunity to change the world.
Most of the biggest businesses and business icons are influential.
Because they’ve changed the way we see and relate to the world.
From Jeff Bezos to Mark Zuckerberg, and Walt Disney to Bill Gates.
These icons and their businesses started with an idea that changed the status quo.
Of course, your business does not have to be the next Apple or Facebook.
Whatever level your business is.
Providing true value to your customers will make you influential to them.
And as you grow and get better, so does your Influence.
Every business exists to solve a problem.
And the better you can do that, the more Influence you will wield.
#4 You’ll have Full Control of Your Life
As a business owner, you have a higher degree of control over your life.
More than just control of your time.
You can literally decide where you want to invest your time, energy, and skills.
This puts you in control of your life.
Unlike the case of an employee.
Where you are constrained by the direction of the company you work in.
As an employee.
Your time, skills, and energy are channeled in the direction that your boss wants.
#5 You Can Get Good Financial Rewards
While the data on business success paints a rather bleak picture.
There is light at the end of the tunnel.
According to the Bureau of Labour Statistics,
On average, 50% of businesses will survive their five years.
Depending on your personal goals.
Own a business may make you financially better than working as an employee.
This is because you get to earn exactly what you are worth in your business.
As a business owner, you can set your prices.
And coupled with the tax perks that businesses have.
You can make more money than you would as an employee
#6 You’ll Have Learning Opportunities
As a business owner, you are guaranteed to face diverse challenges.
These challenges will keep you on your toes.
And provide you with a lot of learning experiences.
This is one of the greatest things about owning a business.
You’ll scarcely experience the same day twice.
From accounting to taxes, sales, marketing, and negotiating with investors
You’ll have the opportunity to learn something new every day.
If you are someone that loves a challenge.
And is excited about solving diverse challenges.
Then running a business is perfect for you.
#7 You’ll Express Your Creativity
Running a business gives you the opportunity to be creative.
The number one job of any entrepreneur is to create solutions for their customers.
Either through products or services.
To run a successful business, you will have to be creative.
And express that creativity to your customers.
Even if you do not consider yourself creative.
Such as an artist or a writer or any typical creative.
Building a business will give you the space to develop and express your creativity.
In order to solve your customers’ problems, you are going to create a lot of things.
And your business becomes the perfect template to express that creativity.
#8 You’ll Have A Sense of Achievement
Many business owners express a feeling of accomplishment.
And pride in the work that they do.
While building a business requires a lot of work.
It doesn’t feel like it because you are doing what you love.
By building your business around your passion.
You’ll enjoy a sense of achievement.
#9 You’ll Have Job Security
As an entrepreneur, you are in control of your career.
And you choose what to and when to do it.
There are no sudden layoffs or dismissals in your future.
This is another reason why many individuals seek to start their businesses.
As a business owner, you control your career path.
Because you make all the decisions.
#10 You’ll Get to Help People
The best businesses succeed because they solve people’s problems.
As a business owner, your job is to literally help people.
This is further expressed when you give back to the community in any form.
You can donate to charity or support a worthy cause.
Or even create job opportunities.
As an entrepreneur, your biggest reward is seeing the smile
And the joy on a customer’s face after patronizing your business.
This is one of the best things about being an entrepreneur.
The ability and resources to help people.
Why You Shouldn’t Own a Business
Alright, now that we’ve talked about the juicy part of running a business.
Let’s look at the not so fun part.
And let’s see some reasons that might keep you off from opening a business.
#11 It’s Hard to Start
Starting a business is hard.
It seems that there are a million and one things that must be done.
From literally re-arranging your life and your schedule.
To the sheer amount of brainwork that goes into creating a business.
It is safe to say that starting and running your own business is no mean feat.
Taking a cue from Newton’s first law of motion: An object at rest tends to stay at rest, and an object in motion tends to stay in motion.
In other words, your new business can be said to be “at rest.”
And needs a huge amount of force to overcome inertia.
The force can be anything.
That will restrict you from giving 100% attention to your business.
This is one of the reasons why many people don’t start businesses.
Even though they may dream or speak of it.
#12 You’ll have to Invest money
No matter the kind of business you want to start.
You’ll have to invest some amount of money into it.
The level of investment will differ.
According to the kind of business you are trying to build.
From buying raw materials to hiring the right staff.
At the very least, you might need to pay for an office.
That could be physical property.
Or space on the internet (if your business is run online).
You’ll also need to hire competent labor.
To provide the best of services and/or products to your customers.
All of this costs money.
And the clincher is, you can’t stop halfway.
Say you need $20,000 to start your business from scratch.
Chances are, you can’t make do with $10,000.
After all, you can’t get a property and not hire staff.
Neither can you get raw materials and neglect the required machines.
So, if you don’t have the minimum amount of investment that your business requires.
You’re better off not starting the business at all.
#13 You’ll invest Long Hours in It
Another requirement for building and running a business.
You will need to spend time on your business.
Creating new products and services.
Dealing with customer complaints.
And a million other things.
The truth is that you have to do each of them exceptionally well.
This is something that deters many people from owning a business.
If you are going to build a successful business.
You can say goodbye to holidays and days off.
For at least at the start of the business
#14 No Income Guarantee
I know I’ve said that you can earn more money as a business owner.
Than when working as an employee, and that’s true.
But here’s the other side of the coin.
There’s no guarantee that you’ll actually make it.
While as an employee there’s a level of assurance.
That you’ll get paid at the end of the month.
There’s no such thing for the entrepreneur.
You only make money when your business makes money, and well, there’s no guarantee that you’ll succeed. It’s the classic risk-reward ratio.
Getting a steady job is a relatively low risk.
But the reward is also on the low side.
On the other hand, owning a business is quite risky.
But the payouts, if you succeed, make the risk worth taking.
#15 You’ll Manage Clients’ Support
As an entrepreneur, part of your job is dealing with and managing people.
Especially, your clients.
While you will eventually have a customer relations department.
And some staff when your business grows bigger.
As a startup, you might be manning the phones.
And answering emails to unsatisfied clients.
This can be tedious.
Especially, if you haven’t trained for it.
Unfortunately, poor client management and support.
It can have a negative impact on your business.
#16 You’ll Have to Change Fast
Practically an unwritten rule.
You are willing to adapt to change quickly and seamlessly.
Whether it’s changing the prices of your offerings to deal with a shift in the market.
Or adopting new technology.
Or even changing the personnel in your business.
The ability to switch from one phase to another is critically important.
If you don’t like change.
You want to work in an environment where everything will maintain the status quo.
Then you shouldn’t be an entrepreneur
#17 You have to Learn a Lot
This is both a pro and a con.
It depends on you and your attitude towards learning.
You will have to learn a lot to succeed as an entrepreneur.
From systems and processes, technology trends and business expansion.
To hiring for the right fit and delegating.
Or productivity hacks, marketing, and leadership.
You literally teach yourself how to do everything.
And all these skills come in handy in running a business.
So, you need to ask yourself.
How fast do you pick up new concepts, ideas, and skillsets?
The answer to this will determine if entrepreneurship is for you or not.
#18 You Have to Wait A Long Time to See Results
Typically, after owning a business.
You’ll have to wait for a couple of years.
Before the first fruits of the sacrifices you made.
And the efforts you put in begin to show.
This can be a turn off for many people.
Because, in a steady, salaried position.
The financial reward for your efforts start coming in almost immediately
#19 You’ll have Very Stiff Competition
Finally, if you run a business.
One of your major headaches will be how to be better than competitors.
So that you can get the best share of the cake.
No matter the industry you operate in.
You’ll probably have multiple competitors that are just as good.
If not better than you.
And finding ways to stay ahead of the competition can be very frustrating.
Running a business has its advantages and disadvantages.
And you’ll be wise to carefully assess both the pros and cons of owning a business.
Then choose if you want to venture into it.
Consider your unique circumstances before deciding to start (or not to start) a business.
Here is a collection of 17 profitable business ideas to get you started in your search for a viable venture.