For many entrepreneurs and small business owners, a forty-hour workweek is a myth - we’ve previously cited the typical 55-hour workweek, on average, of a business owner. Note - working and planning with your local Small Business Development Center will help you mitigate such circumstances - but the unknown aspects of such scenarios might keep you up at night. You can set your own hours and decide when and where you want to work. But running an ethical business is not cheap. So, while money is a consideration, it may not be the primary reason for owning your own business. Will you give up a regular paycheck in order to start your business, and if so, will you be able to pay your bills or sustain your lifestyle? Click here to request free consulting, or contact the SBDC for additional help and information. He currently works as a staff writer for "The Times Republican" in Central Iowa. On a positive note, start-ups with 2 partners are typically most successful (www.entrepreneur.com). And though you may not change the world, the impact that your product or service could have on individuals might be significant. In spite of the challenges and better than even chances of failure, roughly 250,000 new businesses are started each month in the US, according to the SBA. Disadvantages of Small Business Ownership. If you can self-finance the business, this becomes less of a necessity, but very few people can do it. The unfortunate reality is that 4 out of 5 businesses fail within the first 5 years. Your business can be a full expression of who you are. Disadvantages of Small Business Ownership. You may ignore an entire Internet side business simply because it is not in your business plan. If you work 40 hours per week, this process could take 10 straight weeks at a minimum. Gains often are subject to the lower long-term capital-gains rates (www.richdad.com). A strong competitor could enter your space and poach market share from you. Paul holds a Master's in Business Administration from Youngstown State University and a Bachelor's degree in Advertising and Journalism from Penn State. For women, especially, owning your own business can give the lifestyle flexibility necessary to raise a family and still have a successful career. As a business owner, you are the face of the business and you "wear many hats". Reduce Profits: Business ethics reduces the profit earning ability of the organization by putting limits to its operations. So with all of these perceived benefits, why would we ever work for anyone but ourselves? Funding support and resources are provided by the Common wealth of Pennsylvania through the Department of Community and Economic Development; through a cooperative agreement with the U.S. Small Business Administration, and through support from Duquesne University. If you see opportunities beyond what the business plan reveals, taking a risk may be the only way to find out if you're right. More than 400,000,000 entrepreneurs exist around the world, meaning that 1 of every 18 people own a business (www.dealsunny.com). SBDC services are not available to individuals or entities that have been debarred or suspended by the federal government. In some cases, a business plan may provide employees, or even the owner, with a case of tunnel vision. Coming up with a comprehensive business plan could take 400 or 500 hours, according to Cayenne Consulting. Improving working conditions and increasing workers’ wages results in reducing … According to entrepreneur.com, the average salary of an entrepreneur is $55,000, and that’s based on working an average of 66 hours per week. You make all critical decisions. That’s a decent salary in certain low-cost areas, but it would be a struggle to live on those dollars in much of the U.S. An unexpected geo-political event could thrust the economy into a rapid recession, causing consumers to cut back on discretionary spending. You may find yourself working nights, weekends and holidays. Companies working on ethical values can’t focus on profit maximization by exploiting others. You may also realize a lot of personal satisfaction knowing that small businesses help people by creating jobs in their communities and being good corporate citizens. If you work 40 hours per week, this process could take 10 … These include the costs of complying with these regulations. A business model runs on the goal of maximizing their profits. Ultimately, (and with a good dose of sweat equity and a bit of luck), you’ll gain personal satisfaction from implementing your ideas, working directly with customers, and watching your business succeed. And do you have a backup plan, (or another source of income), if things don’t go well and you face a substantial financial loss? He is a part-time faculty member for the Penn State Shenango Campus, and he also serves on the Advisory Board for PSU - Shenango. As the owner, you’re also responsible for the well-being of your employees, and you’ll probably have to perform some unpleasant tasks, like firing people. Those all sound like great reasons for taking the plunge and becoming an entrepreneur. Financial Investment, the financial investment necessary to establish the rules at your business. In the end, choosing whether or not to write a business plan or have one written is a choice you, as the business owner, can make. However, what’s your appetite or risk tolerance to invest a lifetime of savings or even go into debt to start or … Another limitation of e business is that customers can't see or touch the physical product before purchasing it. An incomplete business plan could lead you to invest resources unwisely and cause a financial collapse. Even so, millennials are quite successful in this endeavor with 80% reporting profits, which is 3% higher than the national average for business. You have no concerns about the whims of office politics. Shortcuts are often taken, according to Belmont University. DISADVANTAGES OF BUSINESS ETHICS Loss of Profits. No one can fire us). Disadvantages of Business Plan The biggest disadvantage of the business plans is that it involves time and expenses and as far as small businesses are concerned they neither have money and expertise to make a proper business plan which in turn can lead to business suffering more rather than gaining from the business plan. While these advantages are all valuable, there also are some disadvantages to a business plan. If family time is important, you may want to operate your business from home and eliminate a commute. Disadvantages of Business Ethics. In the world of business, there are so many unknowns that it is comforting to have something on paper that will help determine whether or not your business will be successful. Best of all, owning your own business can have you waking up with a smile on Mondays, eager to start work rather than dragging yourself into someone else's business (www.thebalancesmb.com). No one can fire us). The Duquesne University SBDC provides free business consulting for entrepreneurs in the Greater Pittsburgh area. Tax laws in most countries are structured toward reducing the taxes of business owners and nearly all business expenses are typically deductible, which reduces a company’s taxable income. You’re able to build something that may become part of your ongoing legacy and you could convert your skills, interests, and passions into income. We relish the thought of being our own boss, making much more money than if we worked for someone else, and the idea that we have job security (Ex. The notion of having a standard "day off" may not be realistic, at least at the outset. They need to give equal attention to the interest of its stakeholders like customers, employees, society, creditors, and government. As a business owner, you’ll work in a field that you hopefully really enjoy. Financial Risk. You may also realize a lot of personal satisfaction knowing that small businesses help people by creating jobs in their communities and being good corporate citizens. Even more difficult in a strong economy with low unemployment, you’ll have to recruit, interview and hire qualified people to staff your organization. Therefore, such stringent regulations don’t benefit the business but instead crat… So, while your business may not rise to such lofty levels, you can still represent an agent of powerful change.
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