Photo: Wikimedia Commons
If there’s one thing this bad economy has taught us, it’s that we want to be in charge of our own financial success. You don’t want to be a “sitting duck,” waiting for that pink slip to find its way into your mailbox. More and more people are branching out on their own to start a business, to be their own boss.But with that bravery comes the cold hard fact that nearly 90 per cent of all small businesses fail. I propose that one reason for this high percentage is that too many people fail to take into account their role as a business owner, or franchisee, when deciding what type of business to open.
Many new business owners misunderstand the advice we so often hear to “Do what you love; if you make your hobby your career, you’ll be wealthy for life (emotionally and physically).”
Many small business owners translate that phrase into, “Open a business in an industry that I am passionate about.”
That mindset gets people into all kinds of trouble. The real translation of this age-old advice should be, “Open a business where I, as a business owner, can do the kind of work that I am passionate about – even if it is in an industry I don’t know much, if anything, about.”
Now, before you start thinking I’m a Grinch, consider this scenario. John Smith wants to open a restaurant because he loves to cook. He dives right into the industry he is passionate about and gets knee deep in debt before he realises that he, as the business owner, will not do any of the cooking or even have a hands-on relationship with the food he serves.
Instead, John Smith will most likely spend all of his time managing people, finances, schedules, marketing and a whole host of other business related issues. He is going to have to hire a chef to create his recipes and a team of cooks to make the food and manage the kitchen all day, every day. All of a sudden he realises that he has fallen into the trap of investing in an industry he loves, rather than a position he loves and is good at.
To be a successful business owner or franchisee, you have to go into an industry and a business that will let your own talents shine. If it ends up that you happen to be passionate about an industry where you can succeed and excel as a business owner, then go for it and enjoy it. Just don’t let the industry be the deciding factor in what kind of business to open.
I work with a lot of small business and franchise owners, and you may be surprised to find out that most of these truly successful people actually have ZERO experience in the industry they decided to buy into until they spent some time on the job.
Consider this: If you are good at managing people, you might want to start a company where you get to work one-on-one with your staff, on a daily basis. However, if you don’t like keeping books and handling finances, consider bringing on a partner who excels at that, or be sure to hire a good accountant to make sure you stay in the black.
Before you take that leap of faith to become your own boss, take my advice. Place yourself in a business that will allow you to succeed, a business model that doesn’t already have three strikes against your skill set.
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