Ever wonder whether the people who brag about their small business wealth are really living the high life? Most of what you read on the web about starting your own business tends to be over glorified because everyone is always trying to sell you something.
When all you see are get rich quick tag lines everywhere, it’s no wonder that many people have misconceptions about what it’s like to run your own business.
I’ve already given you a sneak peek into my glamorous life as a small business owner.
Don’t get me wrong though, I’m absolutely 100% pro-entrepreneurship and pro-small business. But while I strongly advocate giving entrepreneurship a chance, I don’t think it’s the right choice for everyone.
There are many trade offs involved. Depending on what you value in your lifestyle, these trade offs may or may not be worth it to you.
Based on my own experiences, I will try and provide you with an honest account of the lifestyle trade offs I make from day to day. I will begin with the negative aspects since you’ve probably heard the positives ones many times already.
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The Payouts Are Unpredictable
One of the biggest negatives about depending on income made from your own business is that your earnings are inherently unpredictable. Especially if your business is brand new, chances are that you’ll have absolutely no clue how much you will make in any given month.
This makes expense planning and budgeting extremely difficult, not to mention stressful. Imagine having to cover your mortgage, education and everyday expenses based solely on sales projections and guesswork.
Imagine trying to make a large purchasing decision that requires financing when you have very little idea whether you’ll be able to make the monthly payment.
My wife and I would like to buy a house one of these days. The problem is that we can never be 100% sure how much we can afford because the revenue from our linens store is extremely bursty.
For example, most of our business is made during the wedding and holiday season and the periods in between can be slow. (This is when my neurotic side kicks in).
I’m hoping that with time, we’ll be able to accurately predict our revenues, but right now we’re not quite there yet. Fortunately, I still have my day job which makes our income somewhat more predictable.
Emergencies May Take You Away From Leisure
Every business will have its share of fires that need to be put out. Sometimes these fires can come at inopportune times. For example, my wife and I have had to wake up extremely early in the morning on a Saturday in order to prep emergency orders for our customers. Sometimes, we screw an order up and have to rush things in order get a replacement product out to the customer.
There have been times when these fires have prevented us from going out with our friends. For example, we had to cancel our child’s play date several weeks ago because we had to deal with a bridal emergency.
Granted, these fires don’t pop up very often, but they can be extremely disruptive to your plans.
In the beginning when you are trying to establish your business from scratch, you can pretty much kiss your social life goodbye. My wife and I probably went about 3 months without seeing any of our friends in order to launch our store. Fortunately, this start up phase is only temporary and once you are past it, things start to settle down.
You Have To Deal With Customers
Depending on the nature of your business, you may have to deal with customers directly. While I’d say 99% of our customers are extremely pleasant to work with, the 1% that are unpleasant are the customers that l remember the most.
If you want to know about some of the customers that we deal with on a day to day business, be sure to check out our customer stories.
In any case, dealing with customers can be extremely draining and humbling. You may have to endure bouts of verbal abuse. You may have to bend over backwards to make a customer happy. Sometimes, you’ll get tormented.
We had one customer who threatened to bad mouth our store all over the internet if we didn’t agree to his ridiculous terms.
If you are not used to dealing with this sort of abuse,then you could be in for a shock. Fortunately, I was married for 3 years prior to starting the business so I was prepared:)
You Feel Personally Responsible
With a regular day job, you never feel personally responsible for things that are beyond your control. For example, if you’re an engineer and your company’s marketing team makes a critical mistake in positioning the product that you designed, you might be disappointed but you probably wouldn’t lose sleep over it.
When you own your own business though, you’ll stress out over everything, even the things that are beyond your control. Your livelihood depends on the proper execution of your business plan so there are no excuses. Every little thing becomes your problem and you have to suck it up and deal with it.
Your Hours Are Unpredictable
Unlike a day job, there is no notion of a weekend. In fact, all of the days kind of blend together. You will need to put in as many hours as necessary in order to accomplish your goals.
Our wedding linens business requires about 3 hours a day of my wife’s time on average. She has to put in these 3 hours on weekends as well. If business is especially strong, sometimes she’ll work for 8 hours.
Sometimes, it gets so busy that both of us have to put in longer hours as well. The time we devote to the business is inherently unpredictable.
The main advantage of the business is that we can time shift all of the work. For example, we can save up 3 days worth of work and put in a single 9 hour work day. This gives us the flexibility to manage our time as we see fit.
The other advantage is that we can hire people to help us out. Imagine trying to hire someone to do your job for you at your day job. It just wouldn’t fly.
Is It Worth It?
As a wise Bleu Panda once said about his day job
It appears to me that although your hours working on the business may be long, you are spending that time much more purposefully. It’s like while I am renting time from my life, you are investing time into yours.
There is a lot of truth in this statement. Any improvements that you make to your business tend to translate directly into your topline. Your earning potential is virtually unlimited and you have the option of working at your own pace.
You will also experience a sense of personal satisfaction when you run your own business as well. Even though I have to deal with irate customers from time to time, I also get to speak with extremely thoughtful customers as well. Some of these customers have said such nice things about our store that I’ve blushed while on the phone.
In retrospect, while I can acknowledge the disadvantages, the positives of running your own business far outweigh the negatives. Give it shot! Worse case scenario, you’ll learn something about yourself that you never knew before.
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Steve Chou is a highly recognized influencer in the ecommerce space and has taught thousands of students how to effectively sell physical products online over at ProfitableOnlineStore.com.
His blog, MyWifeQuitHerJob.com, has been featured in Forbes, Inc, The New York Times, Entrepreneur and MSNBC.
He's also a contributing author for BigCommerce, Klaviyo, ManyChat, Printful, Privy, CXL, Ecommerce Fuel, GlockApps, Privy, Social Media Examiner, Web Designer Depot, Sumo and other leading business publications.
In addition, he runs a popular ecommerce podcast, My Wife Quit Her Job, which is a top 25 marketing show on all of Apple Podcasts.
To stay up to date with all of the latest ecommerce trends, Steve runs a 7 figure ecommerce store, BumblebeeLinens.com, with his wife and puts on an annual ecommerce conference called The Sellers Summit.
Steve carries both a bachelors and a masters degree in electrical engineering from Stanford University. Despite majoring in electrical engineering, he spent a good portion of his graduate education studying entrepreneurship and the mechanics of running small businesses.
Excellent post and great blog! I’m a computer consultant and have owned my own business for the last 5 years. It’s great to have the freedom and the money can be really good at times, but all the things you mentioned is 100% true! I can’t see myself going back to a J-O-B, but there’s no doubt that this isn’t for everyone. Sometimes I just wish I could clock in and go stock some shelves in the corner or something. And when a customer has a problem, I can just point to the manager. Oh wait, I AM the manager. CRAP!!! 🙂 Eric.
You may think you own your own business but you really don’t. You are basically working a “job” that you created for yourself. UNTIL you actually RUN a business and not do the “job” you are still technically just working a job you created, not a owning a business. So I wouldn’t say that your own business.
This is a great post, although I’m not sure I agree with everything you say. It’s important as entrepreneurs to make sure WE are running our business – not letting our business run us! I can take weekends (or longer) if I want – and I do! I don’t have a business with “emergencies” and I only talk to clients directly if they have an appointment scheduled with me. I don’t think I’ve ever received any verbal abuse …
I do agree that payouts can be unpredictable. I didn’t rely on my own business to sustain me until my living expenses were well below my “average” monthly income. I also have four months’ worth of income tucked away, just in case.
The main disadvantage I sometimes have is that I’m a solopreneur. Some days it would be nice to have someone to bounce ideas around with. Also, there are days when it’s 1 p.m. and I’m still in my PJ’s. On the other hand … that might be considered a plus by some!
This article is great food for thought!
Blessings,
Andrea
Hi Eric,
I feel the same way you do every now and then. Wish I could just clock out and let someone else deal with it. But you know as well as I do that it’s completely worth it. Thanks for the comment!
Hi Andrea,
I guess everyone’s business is different. My wife and I have the freedom to take as much time off as we want as well but it probably wouldn’t be good for business growth. I guess the fundamental difference between our business and yours is that we deal with stressed out brides:)
I think the other downside is that sometimes you have to do both: your J-O-B and your business until the business picks up, you can cover your expenses with just the business, your health insurance issues are straightened out, etc.
Wow. Awesome post once again.
Your business might be unable to support you so you might have to work extra hard so your business can atleast give decent profit.
As in anything, you have to weight the positives and negatives. I’m also pro small business and pro entrepreneur. I’d rather depend on myself for my income than some person 1500 miles away who doesn’t know or care about me. Great post!
-HIB
Hi Carla,
Yep, in our case we have to work 2 jobs until the money starts rolling in. A lot of my friends quit their jobs cold turkey to pursue their passions. Takes a lot of guts but it’s probably the best way to go since you can devote 100% of your time to the venture. Ack, I keep forgetting about health insurance. Fortunately, you’re there to remind me.
Hi Trevor,
Thanks for the comment. It’s hard work and people should know what they are getting into.
Hi Dustin,
Agree with you 100%. There’s little chance that my wife will ever go back to work again.
In the comments on my blog last week, someone who works a 9-5 job was wondering why we self-employed people do this to ourselves.
While I’ll never return to a 9-5 job (it’s just not me), I’ve set limits on my business. I might not earn as much or my business might not grow as quickly as I’d ideally want, but I’m much happier, not working evenings and not opening the computer on weekends – a healthy relationship is more important than a thriving business. 😉
Thanks for a great post!
I run a small dressmaking business (very small in fact, it’s only me) offering made to measure outfits for flamenco dancers and I can relate to all the points you made. Especially the irregular income and having total responsibility for every detail of the business can sometimes be stressful. But being my own boss also gives me the power to change anything the way I feel will improve the business.
I don’t miss having to deal with incompetent managers or worry about losing my job when management has yet again had a brilliant idea of “re-structuring” the organisation.
But most of all, I never again want to miss out on the satisfaction of having happy customers, having them come back again and again and referring their friends to me.
Ok, I carry all the weight but I also get all the credit for a job well done.
It sounds like you and your wife are doing a great job of building your business, but your are correct in saying that being self-employed is not for everyone. Having been a commissioned sales rep for many years, I know what it’s like to not know what your income will be from month to month. That’s one of the reasons that I made a choice to build a network marketing business as one of my sources of income. It offers the residual income that gives a little more stability.
I once had a customer seriously threaten to sue me over the phone! Once I cooled off, I realized how illogical they were, how the amount wouldn’t be worth it to them, and how everything was actually going to be okay. I’d done more to make them happy than any other customer I’ve ever had, so it’s not as if I wasn’t doing everything I could to give them what they wanted. However, the short period of time right after I got off the phone was definitely one of the more stressful times I’ve experienced.
@Alex,
I completely agree with you. Sometimes it’s just not worth the time that you have to put in to grow at fast rates. I think the startup phase is unavoidable though. Once business starts rolling a bit, usually you can kick back and enjoy life a bit more. It’s tough to do though.
@Anke
It is a great feeling to have happy customers isn’t it? Sometimes the most pain in the ass customers give the most praise in the end. Currently my wife and I are carrying most of the weight. We hire some people to help out here and there but hopefully we’ll get to a point soon where we can hire someone full time.
@Susan
Having bursty income can be stressful at times. Our business is just starting to become more predictable. As more data is collected, we in theory should be able to predict our income more accurately next year. I’ll have to check out your network marketing business again. I’ll head over after I’m done responding to comments.
@Jon
Wow! That has never happened to us before. I’m not sure how I would have reacted. You’re probably lucky that customer was not a lawyer otherwise they may have followed through with it. My brother is a lawyer and he always mentions suing people left and right. Do you find that bad customers are in the minority? Have you been to our customer stories section?:)
Great post! Very honest!
I have been an entrepreneur for almost 15 years now. And I have be very blessed with it. So for me I would say 100% worth.
I love this article.
I have over seen a few businesses and am struggling with my newest venture http://www.giveageorge.com which is a site for local residents in a small City in Florida.
It is hard to get going but it just takes a dream and determination.
Great post – this is something that I think everyone who is out of work is dealing with in one way or another right now.
Hi All,
What would your advice be for a young 20-something year old looking to start up his own business and escape the employee daily grind? I currently have no debts (paid off student loans), make decent income working full-time & have some savings.
But every day coming into the office I want to quit my job because all I can think about is how I am making someone ELSE rich. On the other hand, I don’t want to make an uneducated or brash decision and I also feel like I need some more experience.
Do I continue working full-time, slowly move into contract work while I begin to start-up my own business on the side? Or do I do the brave act of quitting and dedicating myself to starting up my own business 100%, whatever that may be?
Any advice/ help would be greatly appreciated. I feel like I have a lot of talent, unrealized potential and time that is being wasted right now.
Hey Steve
I would start your business on the side and only quit once your business has some traction. You absolutely don’t want to make business decisions out of desperation or need for money so working a day job will help you alleviate the pressure.
Great article. Dealing with a start-up company is difficult in the beginning. Success doesn’t come over night.
I lost my faith in JOB.
It’s ridiculous in this economy people are still rely on JOB.
I have a PhD in Computer Science and passed CFA level 1 with more than 6 years experience in various industry. I got laid off and I cannot get a job for 2 months, enough is enough, I have family to eat… I decided to sell Kebab with delivery. I also teach jazz piano and write Computer Books and sell it online
I can’t believe this but actually I am more satisfied personally and financially selling kebab than working9 to 5. I will open my second Kebab chain.
Please, please teach your children to HOW DO BUSINESS AND CREATE A VALUE from whatever they do. Teach them to be independent and never rely on someone else..
Expecting to GET A JOB is the worst idea you can have now..
Thanks for posting your article. In a world where all of technology has fallen into every hand, it has become very difficult to thrive at running a business. You most certainly have to find a niche or “scheme” if you will. It’s difficult for ethics to exists considering the cut-throat sellout mentality that is required in this century.
I am an owner of a small business and I agree with you on all the points! Read all the comments too.
Your post will certainly motivate people to start their enterprise.
It is really creative post. Thanks for great posting.
I totally agree with you on all of this! I had a small business for a couple of years…I had NO social life, NO time to myself, and constant anxiety. Needless to say, it wasn’t for me. I will unfortunately ALWAYS remember what those rude customers said to me :/ I do miss the money, though..but I suppose I need some stability in my life with a full time position.
I have been approached by the owner of the small business that I have been working for over the last 4 years to become a partner. I have been successfully running small businesses for well over 15 years but this is a first for me. Any thoughts, what to look for, or to look out for. I like the idea but would appreciate some outside perspective.
Hi Steve, my husband and I are really enjoying your 6 day course at present.
I am currently at a crossroads employment-wise and have just written a post along the same lines as this one regarding a job vs a business.
You have some great stuff on your site, it’s going to take me a long time to get through it all! Keep up the great work. Cheers, Meg
Why do you do it? In addition to a day job where it can be very difficult, if even possible, to spend time on personal (non-day job related) calls, what is the payoff for also running your own business.
The obvious and first answer to me is that your prediction of making a great deal of money (which involves hiring people to do certain tasks so you don’t have to hand-sew emblems on a Saturday morning) either as your sole source or augmentation to your day job salary.
Why on earth would anybody undertake developing their own business if not for a great deal of speculation and hope that it will someday be financially worth it.
But maybe there is more to it than just money.
I’m sincerely curious and who better to ask than someone running their own small business?
Because it sounds miserable. Having a root canal SOUNDS better than this.
Tell me how I am wrong. Thank you (sincerely).
-Sue
(I’m especially mystified when people say they go months without paying themselves during the early phase of running a business. One cannot do that without a solid income coming from another member of the family. We all have to have an income at all times to survive)
I look forward to your reply. Thanx
Hey Susan,
Thanks for your comment and bringing me back down memory lane:) This post was written over 8 years ago back when we first started. Today, our business is much larger and more profitable to the point where all of the heavy lifting is taken care of by our employees.
So you can say that all of that work has paid off over the years:)
While I do understand the part about trying to satisfy an angry customer because word of mouth is critical to building customer base, but surely there is a point when you will not take abuse from an angry customer at all. Especially when they are unreasonable or just a$$holes. The customer is not always right and should not have carte blanche to verbally beat you just because something wasn’t perfect.
Hi Susan,
Statistically speaking, the number of unreasonable customers is an extremely small percentage of your overall business. However, a few pissed off customers can wreak havoc on your word of mouth and reputation. Therefore it’s better to just appease the bad seeds and write it off as a marketing expense. In some cases, your bad customers will do a 180 and become evangelists for your store after you give them a refund.
There are advantages of owning a business especially in retail.
1) work every holiday known to man
2) deal with customers ( nasty and ignorant ones).
3) worry about constant bills
4) spend no time with family and friends
5) to sum it up basically your a slave to the business
Ive own my own business for 10 years and cant wait to get a job! Vacation time!
I remember I tried starting out a small company selling trading cards after my A Levels (I was 18 then). It didn’t turn out well because of some mistakes I made, but I learnt a lot from my experience.
Now I’m running 2 businesses in my spare time while pursuing my undergraduate studies. It’s tough, but all I can say is nothing beats the feeling of freedom and that of being able to call your own shots.
Hi. I started my own small poultry farm with the aim of getting it bigger with every passing year. I think working for oneself rocks. Your article is greatly inspiring.
A lot of people these days overromanticize owning a business when in reality it’s such a hard work and you have to make your own decisions. When you have a boss and higher management, you’re not holding a full responsibility for your actions. I know that because since starting my own business, life became so much harder. If you’re looking for a well-paid office job, I’d recommend using this http://smartresumesolutions.com/ great tool to show your skills properly and impress your future employers.
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I Am doing a studying about own bussines
I think it really depends on the type of business that you own.. if you are in retail or have a store that you have to open everyday.. that can be very wearing on you. Also owning a restaurant can be crazy. But if you own a diff type of business it can be less demanding, or demanding in different ways I suppose.
Just curious, if you had to define the general characteristic and personality of a person NOT suited for entrepreneurship, what would they be?