Building Your Wealth
5 Reasons to Keep Your Business Small
Is your business big enough for you? Often times growing is not the best option.
It seems like every entrepreneur and business owner I meet is highly focused on fast growth to a large business, and becoming the next unicorn.
They don't realize that running a large business brings a whole new set of problems, and may not be all that much fun, compared with their small business role. If you enjoy your role today, I believe it makes more sense just to keep it that way.
You won't often find that recommended by consultants, so I was pleasantly surprised to see the key points highlighted in a new book, Self-Made Boss, by Jackie Reses and Lauren Weinberg. These authors have enjoyed leadership positions in big companies, as well as small, and distill their advice from interviews with dozens of business owners of all sizes around the country.
As you look forward from where you are today, consider the following points that the authors agree are key to your satisfaction, as well as your success in business:
Most of you entrepreneurs have a passion for your solution, and some see the business as a necessary burden. You need to realize that the business role, including financials, marketing, personnel, and team building, only grows over time and your creative role is reduced.
One big reason for the high rate of startup failures, with well over half not lasting five years, is not that the solutions are not innovative, but that the entrepreneur focuses on the product rather than on the business of attracting and managing customers.
You may be able to train others to do the work you do, but they may not have your passion or unique quality. But the more you get involved with mentoring and training, the less time you have to enjoy the creative process. If you are the business, it makes no sense to stress over scaling it.
Another reality is that some of you are micromanagers. If you can't bear delegating any substantive decision to your team, then growing the business will become ever more stressful and non-satisfying. Keeping your business small is the right answer for you.
Even a successful bigger business will bring additional responsibilities, new competition, and more demands on your time. You can look at these as learning opportunities, and enjoy the bigger financial returns, or see them as a larger burden, or an encroachment on your personal interest and satisfaction.
For example, a whole new level of communication skills is required. Because you can no longer meet one-on-one with every constituent, you have to learn to use new communication channels, including public speaking, networking, and public relations.
If you see your brand as a high-end boutique, bigger isn't always better. As businesses grow, it becomes harder and harder to provide that high standard of personalized service. Before you find yourself in trouble, take a hard look at your growth strategy, as well as your personal needs and objectives.
We are all jealous of the luxury brands, including Rolex and Armani, which thrive with their high profit margins and limited number of customers. At the same time, we know that their success is not based exclusively on having the best product, but also on building relationships.
Many of you small-business leaders have caregiving responsibilities for loved ones, or simply prize the time you are able to travel and spend time with your friends and family. You need to decide whether you live to work, or work to live. Make these decisions proactively before a business crisis occurs.
The new term I hear in this arena is work-life integration. The concept here is that your personal and professional lives don't have to be competitors. If your passion is saving the environment, for example, you can make that your business as well as personal focus.
I have learned through real experience that starting a business is hard, and expanding it can be even harder, which is why you should consider staying small, and enjoy your life more.
There is no shame in having a small business versus a large one, and in fact most of the small ones I know are able to treat their customers better, and maintain a more positive legacy as well.
The contents in this article are being provided for educational and informational purposes only. The information and comments are not the views or opinions of Union Bank, its subsidiaries or affiliates.
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