If you work for a company, you probably have a steady job and income. You probably enjoy the usual fringe benefits, such as paid vacations and life and medical insurance. If work runs out, it is up to somebody else to find something for you to do. When work piles up, somebody else can be brought in to help. If you get sick, it's up to your boss to cover you. You may have some flexibility in deciding where you want to live if you work for a company with many locations.
You may even have a career path established with your company. If you follow this career path, you can probably enjoy a comfortable retirement through the company pension plan. Are you sure you want to abandon the corporate life to start your own business? Before you answer this question, let's explore the reasons people become self-employed.
Controlling Their Destiny
Many people find regular employment unsatisfying because it forces them to accept and respond to decisions others make on their behalf. They may not like the people they work for, their work location, their working hours, or their possibilities for advancement. The company may be poorly managed or in poor financial condition, or there may be frequent layoffs. Whatever the trigger, the ability to control one's destiny can be a major motivation for opening a personal business.
The Creative Urge
If you have truly developed a better mousetrap or discovered a better way of doing something, starting your own business may be the simplest and most direct way to get your idea into the market. If you succeed, there is a great deal of personal gratification in being able to say, "I did it with my idea, my way."
The creative urge can be a powerful driver that gives people the incentive to start their own business. It can also prove to be one of your worst enemies if you lose your objectivity along the way. If your unique idea proves to be not so unique after all, will you recognize the facts when you see them, and adjust your strategies accordingly?
Financial Rewards
Most people who start their own business expect financial rewards for their endeavor. They have every right to this expectation. In the business world, financial rewards increase in direct proportion to the level of risk a company is willing to take.
The banking industry provides a classic illustration of this simple concept. If you ask for an unsecured loan, what happens? The bank charges you a higher interest rate to compensate it for the higher risk of loans that are not secured by collateral.
The same principles apply if you open a business. The failure rates for personal businesses are very high. As a business owner, you have a right to expect a high rate of return to compensate you for the risk you are taking on, just as the bank does. Entrepreneurs are driven to achieve high financial rewards. They know that if they do not achieve acceptable profit levels, their business venture will not survive. Since they are in it for the long term, they reject one of the most common start-up scenarios: "I'll try it for a while to see if it works. If it doesn't work, I can always go back to my old job."
If this is your scenario, you'll probably end up back at your old job. Entrepreneurs know exactly how much money they need to make to stay in business. They are committed to the achievement of specific financial goals and do not consider their old job as a viable option.
Chrysler's Lee Iacocca was once asked, "After you joined Chrysler and discovered how much trouble the company was in, did you ever consider throwing in the towel and going back to Ford?" Iacocca responded by saying, "Never! Once I made the commitment, I never lost my determination to do everything I could to make sure the company achieved reasonable financial rewards."
* Source How To Start and Operate a Successful Business
