It’s very common, especially during the current economic recession that we are in, to hear talk about how employees are being laid off and how tough it is to make ends meet after you’ve been laid off.
What would an entrepreneur feel that can be comparable to this? Probably rebuilding a company. During times when businesses are doing well, entrepreneurs are able to generate a living for themselves based off of their profits. But what happens if these profits were to begin to diminish for whatever reason? The entrepreneur has to cut back on costs, and most likely has to stop paying himself until he is able to turn his business around. Unlike an employee who gets laid off, the entrepreneur, if he should decide to keep his business, has no unemployment insurance to fall back on, and in an ironic twist of fate, must actually work harder than he ever had before for FREE until he can turn the business around. I think this is something that is not very well understood by most of the general public. Non-entrepreneurs will never truly comprehend just how tough it can be sometimes to be in business for yourself.
With that being said, I would not trade being an entrepreneur for any other career or traditional employment. Ever. I ‘d rather be broke and call my own shots while building something sustainable and exciting than chug along at a job that is no-less risky (you can get fired and lose your income at anytime working for someone else). All these benefits PLUS the fact that as an entrepreneur you are building life-long skills such as learning how to sell, negotiate, manage employees, the list goes on.
I’m sure you’ve all heard the expression “honey catches more flies than vinegar.” In case you don’t understand the deeper meaning of this statement, it means that being pleasant and amicable to people can produce greater results for you or your business than leaving a bitter taste in their mouth if you were to use force, pressure, or other blunt, negative tactics. This is applicable to businesspeople and entrepreneurs because its important to keep in mind when dealing with employees, suppliers, customers, and other stakeholders in general. I am a strong believer in this approach as I feel it is critical to gain the trust of the people you are surrounded with on a regular basis. I am also sure that most people would agree with this philosophy. The issue becomes important to look at when someone is using too much honey, and the people around him become entitled, lazy, and possibly even take advantage of a nice situation. It happens in business a lot. These types of bosses are considered “pushovers”, and while I never actually got to that point with any of my stakeholders, looking back I can see that I got dangerously close. There is nothing wrong with being a nice guy, but occasionally, and especially in business, you have a culture to create. Just like all things in life, too much honey or kindness, being laid back, and any related attitude can send the wrong signal. Vinegar should be used occasionally and should be mixed into the honey to create balance and keep everyone on their toes. While it is certainly true that honey can catch flies, exterminators don’t use it to get rid of pests.
It took me the second half of my 20’s (I’ve been in business for myself since the age of 24) to learn this, but business at the end of the day should be about making a profit. I am glad that I learned this lesson when I did, and despite building my own business with the hopes of selling it to a strategic buyer, I lost focus of the fact that I should remain profitable despite growing my company. For a while I put expansion and growth ahead of profit and I even used debt to make this happen. Needless to say, this was an unsustainable endeavor, and for the majority of this year I have been working hard to turn my company around. I’m finally able to say that my businesses are restructured and back on track while providing the beginnings of a sustainable profit. I had to recognize that a change was needed, and had to move fast as opportunities began to present themselves in the form of challenges or problems. In the long term, I have essentially built a solid foundation and have surrounded myself with the right people to continue maintaining these businesses. I hope these can be passive ventures for me as I focus on my web publishing and real estate ventures for the next phase of my entrepreneurial career. Life teaches you lessons constantly, and the business world is no different.
Dan Sfera is an entrepreneur in the clinical trials and real estate industries. His business blog is dansfera.com
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