Small business ownership has its perks — you get to be your own boss and set your own work schedule. But it's not for everybody. There’s a reason many businesses don’t make it past the five-year mark.
According to the Small Business Administration, about two-thirds of businesses with employees survive longer than two years while only half make it at least five years. While the reasons businesses fail vary, underestimating the risks and the significant responsibilities of being a business owner are among the top reasons.
Small business ownership can be extremely rewarding, granted it's a success. Interestingly, business owners who thrive tend to possess certain characteristics. If you want to achieve success with your business, read on to learn the top five traits you need to succeed as a business owner.
Anyone can start a business if they have the cash to get it off the ground. However, successful business owners have a passion for the product or service they’re selling. They aren’t in it to make a quick buck; they're in it because they believe in their enterprise.
Take environmentally friendly cleaning products as an example. An entrepreneur who actually cares about the environment and the toxins we breathe in will appear more genuine than someone who is trying to ride a trend. The passion will shine through, resonating with like-minded consumers. Business owners who believe in the products or services they offer tend to be more knowledgeable, understand the industry better, and can pivot when necessary.
If you don't care about the products or services your business provides beyond making money, you’re less likely to invest the energy and effort necessary to make it grow. Not to mention how much harder it will be to spot any changes or trends.
Passionate entrepreneurs don’t give their products lip service, they actually use them. Truly loving what you do will ensure business ownership doesn’t turn into the equivalent of taking just any old job. Feeling passionate about something without a business plan can often be more valuable than having capital but no passion. Often, the joy it brings you is the only thing you'll have to fallback on when times get hard.
Forget calling in sick or spending 20 minutes hanging out around the water cooler discussing the Game of Thrones finale. When you’re the boss, you don’t have time to procrastinate. You'll have to commit a lot of blood, sweat, and tears to be a success, often working around the clock. It may feel like a losing battle sometimes, but the harder you work, the likelier you’ll be to create a business success story. Successful entrepreneurs bring all sorts of things to the table, but a shared characteristic is commitment. Without it, you won't be giving your business its best chance to thrive.
Many business owners stay in their current career as they get their small business up and running. Since it can take a while to generate a profit, having another source of cash flow is often necessary. It also requires you to work overtime. That’s another reason a strong work ethic is a must.
Giving up your career to start your own business isn't something you decide overnight or on a whim. The successful ones worked for someone else until they were ready. They learned the ins and outs, and they were confident that they could do it better. The last thing you want is to feel forced to launch a business because you're jaded or just got laid off. Lots of people will leap solely because they hate their job, assuming leaving it will fix everything. They still end up unsatisfied and resentful — a recipe for disaster for any business owner.
Small business owners stay extremely busy wearing multiple hats. One minute they are dealing with a customer complaint, and the next they are looking for new customers. They have to play boss, accountant, marketer, and office manager all in the same day. Even if there is support staff, business owners can get caught up in the mundane aspects of the operations, letting important things fall to the wayside.
Without top-notch time management and organizational skills, it's easy to become overwhelmed. The ones that know how to manage their time don’t. They plan their days properly, allocating time to essential aspects of the operations. They are organized, punctual and can prioritize. The successful ones aren’t afraid to delegate tasks. They understand they can’t do it all, and that to get things accomplished, they have to give up some control.
Even the best business idea needs some tweaking from time to time. That’s particularly true when a business is just starting out. It’s common to focus your efforts one way only to suddenly shift in another direction. For instance, you may start out selling your product to consumers only to realize that b2b is a bigger opportunity. Or, one service may not take off with your clients, forcing you to offer another one. Being flexible, nimble and willing to change are key attributes for successful business people.
Successful business owners aren’t married to one idea, and they will go where the opportunity is. The more willing and open you are to new ideas, the greater your chances of success. Business ownership requires you to take risks and get out of your comfort zone.
Also, successful business owners never stop learning, and they are constantly looking for opportunities to expand their knowledge to grow their business. They aren’t afraid to hire people who are smarter than they are. And most entrepreneurs who make business decisions out of fear or insecurity tend to fail.
A fundamental characteristic of any successful business owner is perseverance. Without it, your chances of succeeding are slim.
Operating a business has its ups and downs. There could be times where you barely make payroll, are completely stressed out or haven't stopped working in days. But there will also be times when your business is booming; products are flying off the shelf and sales are growing. Being able to stick it out during the tough times will ensure more of the good times to come. If you’re quick to give up as soon as you face hardship, you’ll never be able to succeed.
There will be lots of fits and starts when trying to get a new enterprise off the ground, recognizing and accepting that will enable you to persevere. There’s no guarantee your business will be a success, but if you’re able to accept that it will be easier to fight for it. If you let fear control you, the business may never get up and running, and you’ll never know if it would have been a success. The worst thing that can happen is you’ll fail, but that failure could get you one step closer to your eventual success.
Business owners are typically hard-charging people who are ambitious, smart, and hungry. What separates the good ones from the bad ones is their ability to understand their strengths and weaknesses before launching the business. Some businesspeople are going to be the visionary type — they might see the big picture but lack the necessary technical skills to see it to fruition. Others might have all the skills but cannot communicate effectively and sell the product. Understanding your strengths and weakness will enable you to amass the right team. Since inexperience is one of the reasons businesses go under, creating a team of experts is a critical ingredient for success.
Small businesses are the backbone of this economy, employing millions of people or close to half of the private workforce, according to the SBA. But just because owning your own business puts you in control doesn't guarantee your success. You'll need passion, a willingness to commit, a business sense, and confidence in your ability to succeed.
What character traits do you think are essential for small business owners?
Brenda Morrison is a freelance writer and entrepreneur with over five years of experience owning a successful small business. She writes about entrepreneurship and personal finance for dozens of websites. She lives and works in Chicago.