The spirit of entrepreneurialism can arguably be said to have been one of the chief concepts that built the American business culture. From Henry Ford to Steve Jobs to your next door neighbor’s innovative consulting, Americans exude a special knack for turning a set of challenges into profitable assets.
While small business ventures have contributed much to American business life, they have also demonstrated why it’s critical to carefully plan before making the decision to go into business for yourself.
According to statistics from the U.S. Census Bureau, 70,000 more small businesses packed up shop than kept going this year. Not every one of those is due to a business going under, as some small business owners simply retire or have their enterprise absorbed by a larger one.
Before you consider outfitting that newly rented office space with Modular Furniture Systems, take a few minutes to acquaint yourself with some key small-business facts, courtesy of CNBC:
According to the 2013 Global Entrepreneurship Monitor report, the main reason small businesses fail is pretty simple: They just run out of cash. And securing credit to keep going can also be a major hurdle. Think that’s a mistake that only greenhorn business owners make? Not so, says the report. More than one third of experienced business owners run the well dry. Something as basic as failing to generate an invoice in a timely manner can lead to strained cash flow. Bottom line: Secure capital and fine-tune office procedures before throwing open the doors.
Another quick deflator of the small business balloon is overconfidence. This one is tough, because any entrepreneur needs a fair amount of chutzpah in order to be successful. The key here, it seems, is to maintain an awareness of when big dreams and fancy talk start to cloud your perception of what’s actually working to generate a profit for you.
So, by now, you’re more than ready to work long hours, chase down every stray idea or policy and do whatever it takes to ensure success. Trouble is, you’re only human, and working yourself to the bone will eventually lead to burnout. No matter how positive your outlook. In fact, a recent Manta survey found that more than 8 in 10 business owners were optimistic about the second half of 2014. That’s all well and good, but without the business owner’s enthusiasm staying at those levels, things can quickly change for the worse. Stay positive, but also take care of yourself!
Check out the rest of CNBC’s article here.