Businesses that rule the roost today were once small businesses. The importance of small businesses has never been felt as much as today where there is growing amount of job scarcity and the best way to earn a livelihood is to self-employ yourself for a small business venture.
Most businesses which are ruling over their respective industries today as market leaders were originally started as one-person business ideas or in some cases an idea by a group of friends or colleagues. The creation of a business is an important step for people to take since it involves a considerable level of danger and risk. Having your own business is unlike any other job you may do. When you found your business, you are actually taking the pathway to a different lifestyle altogether.
What is important to note when you are starting your business is that you need to be the chief of everything. This means you will be in charge of your business unless you decide to hire help. Even in such a case you will have to keep a watchful eye on your help and ensure that all aspects of business are going on as planned. This job requires commitment, dedication and a will to succeed.
In the modern times though starting a business and making sure that it stays afloat is tough, however the fact that there is a scarcity of jobs has meant that the state is encouraging people through various measures to start up a company and employ other people as well as employing themselves. The Silicon Valley for one is the temple of entrepreneurs and people hopeful of starting out a small business of their own.
Yet, when you are looking to start a business in such modern times when the economic condition on the whole is turbulent, there are a number of different angels and demons that may cross your path through the course of your path to creating the business.
A Vital Component
The creation and survival of more and more small business in the market is crucial to the uplifting of the economy. The importance of a small business is not only because somewhere down the line they may become a larger highly successful company. They are also highly significant because they are designed to cater the local needs for services or products.
In the UK for example which is one of the leading economies of the world, most of the businesses are small. Nearly two thirds of these are run and owned by a single person and most importantly 90% of them only employ fewer than 6 people. How does this benefit the unemployment situation? In the UK 2.5 million of the workers are self-employed simply put every 8th worker you meet in the UK will be employed by himself.
There many reasons that dictates the way small business survive and flourish. These reasons can be called the angels of small businesses and some of these angles are outlined below.
· Flexibility and Adaptability
A leading angel of small businesses is their trait of flexibility and adaptability. In a small business there is little formal hierarchy established and the owner is the all in all in each and every matter. Here the lack of hierarchical structure can result in a smaller or nonexistent chain of command. Unlike large businesses that have procedures and set patterns to follow in a small business you can change the way you operate the decision is reached quickly and whatever that needs to be done for the businesses benefit is done.
· Creating Personal Relations with Customers
In the world of social media interactions and automated replies by large companies, a small business will be able to attract customers because of their direct personal relations. When you are in charge of most of the work yourself, you get a chance to go hands on with the employees, the vendors and the customers. All of which can improve your businesses chances of enjoying loyalty. Direct customer contact would create a unique more personalized approach with your customers, giving your business and edge.
· Innovation and Inventiveness
The world’s economy is becoming more and more dynamic. The customers in particular have become far more demanding and are often looking for something extra, unique or new. An old company that is large may not be able to significantly change the product categories or introduce new products. However in this case inventiveness and innovation are two angels that small business can make use of.
A small business due to its relatively unknown background will be able to take a risk on a new product and hope for its success. An example here is that of The Body Shop which started with environmentally friendly cosmetics into the market where a commercial cosmetic company wouldn’t have been able to.
There many reasons that can hamper and put spanner in the works of your small business’s survival and health. These reasons can be called the devils of small businesses and some of these devils are outlined below.
· A Basic Nobody
A smaller business irrespective of the type of product you have will not garner the same recognition or attention that large business get. How then do you get your products registered with the general public? This is an issue. Small companies cannot match the larger firms in terms of their advertising and recognition needs. For small businesses the process of starting to build its brand image and recognition is right from scratch. A larger chain on the other hand will have an established presence in the market and a degree of respect and appreciation amongst the general public.
· Bargain Power
If you are a small business in a market where there are large businesses you will find yourself at a severe disadvantage facing a devil known as lack of bargaining power. When a vendor or a supplier that you want to deal with already has to supply to larger more established firms that ask for its raw material etc in a larger quantity why would they listen to your offers of a cheaper bargain. In such a market you will have to abide by their rules since your small size will defeat the logic in your bargain. However this can be avoided if you are able to either find an alternative or painstakingly work hard to convince the vendor of the bargain’s advantage to them.
· Small Budgets
A small business a small budget, a large business a large budget, the equation of business can sometimes be as simple as that. Another devil for small business is the lack of financial resources and a small budget all of which can culminate in a vicious cycle. The lack of financial resources and a budget is due to the smaller revenue outputs, smaller margins of trade and smaller profit volumes. In most cases this budget and financial resources are hard to increase even through outside intervention since banks and lenders are more willing to give money to larger businesses as opposed to smaller ones.
Despite the devils that face the small business, the angels in most cases outweigh them, especially since the modern times have seen advents of things such as crowd funding etc. which can ensure that newer business ideas and smaller businesses can not only survive but tackle the situation at hand.