There are many rewards for being a business owner. You have the ability to define your own destiny and your fate is largely in your own hands. If you make the right choices, develop good plans and execute well on your plans then you can reasonably expect to do well financially.
There are many people who talk about running their own business and there a subset of those who go on to actually take the risk … because that is exactly what it is. There are a ton of statistics around the number of companies that go bankrupt in their early years in business … around 80% of new companies go bankrupt… and, depending on who you believe , this happens in either the first year, the first three years or the first five years. Best case you have a 20% of surviving as a new business.
“The price of success is hard work, dedication to the job at hand, and the determination that whether we win or lose, we have applied the best of ourselves to the task at hand.” Vince Lombardi
Assuming that your business is one of those that survives, it is a fair bet your survival is the result of hard work, good strategy, good people, good execution and some luck!
So now you have a “going concern”, a business that generates profits that can be used to fuel growth and compete with the best. Of course we live in an ever changing world and you have to hope that:
- your company is not operating in the equivalent of the “buggy whip” sector;
- your competition is not reinventing your market space before you can;
- you can attract and retain talented people;
- you can attract and retain good clients;
- you can remain relevant;
- the economy will not tank to the point where you can’t hang on;
- a cheap offshore solution doesn’t become available (look at SW Ontario’s manufacturing base); and
- that governments do not introduce legislation that will make your business model unaffordable (I’m looking at you Kathleen Wynne and YOU Justin Trudeau).
“Where do you put the fear when you choose to innovate? The fear is there, but you have to find a place to put it.” —Seth Godin
I thought I would revisit a blog entry that I wrote a number of years ago, and which I find to be still relevant after more than twenty years in business.
Here are a few insights into what it might take for you to join the ranks of business owners.
On a day to day basis you are responsible for the operation of your company, its conformance to the many laws of the land, (a) Federal, (b) provincial and even (c) municipal; you are responsible for the actions of your people; you run the risk of legal action for any number of events that could happen among your staff, your offices or your clients.
When your company becomes stable you may be considered a ”pillar of the community”, so you volunteer (happily) to help with charities, donate funds and time help those less fortunate than you. Of course in doing so you self-identify as the person to approach for every charity “out there”, and feel about 3 inches tall every time you have to say no. The time commitment grows and you soon find yourself with another full time job, in addition to the one running your company.
Because you own the company you are expected to “do whatever it takes” for the company. You represent the company on the industry association, you attend breakfast functions, luncheon meetings and dinners. You give speeches (which require preparation), lobby politicians (which requires time and preparation), jump on airplanes at the drop of a hat and learn just how little sleep you can survive on. One entrepreneur I knew talked about the “raccoon look” that he related to entrepreneurs who tend to operate on little sleep … that dark eyed, haunted look of the Type A personality working every hour possible to build their dream!
You spend the years trying to set aside some money for that time when you choose to retire and if a market meltdown doesn’t totally destroy it, or a company crisis cause you to reinvest it, then likely you will end up with your own self funded retirement fund. If when that time comes you still have a “going concern” then you may get the opportunity to actually sell your company. At which point you get to commit to company performance for two or three years following the sale (an “earn out”), while you work for someone else and hope they don’t make stupid decisions that kills your nestegg!
“Whenever you see a successful business, someone once made a courageous decision.” Peter Drucker
Welcome to the life of a business owner. Don’t think I am looking for sympathy because I love it! It does however mean that most people do not want this life … does that make me a masochist? However, if nobody did it then where would the jobs come from?
Kevin Dee is Chairman and founder of Eagle (a Professional Staffing Company)
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