SmallBizLady: Is there a big difference between a small business owner and an entrepreneur?
Brian Moran: Huge! A small business owner is someone who would rather work for themselves than in corporate America. They want to be in charge of their own destiny. They want a work/life balance too. Their goals aren’t to open new locations or to go global. Many are “income substituters”. Their goal is to make the same money in their own business that they would make in a corporate job. Additionally, they will look at most purchases as “expenses” because the money is coming directly out of their pockets. Entrepreneurs are defined by their “aspirations”. They are all about growth. In their business plans, they write about hiring employees, opening new locations and entering new markets. Some will look for outside investors and almost all entrepreneurs look at purchases as “investments” rather than expenses. They believe in spending money to make money.
SmallBizLady: Is there anything in between the two groups?
Brian Moran: Yes. I believe there is a large group of passionate small business owners. People in this group don’t share the same aspirations as entrepreneurs, but they love what they do and actively seek ways to run better businesses. They will attend conferences, seminars and networking events. They use social media for business and proactively look to maximize existing opportunities. In some cases, such as professional services, they will hire additional revenue generators if they create enough demand for their services.
SmallBizLady: Do you think most business owners are #smallbiz, #entrepreneurs or passionate #smallbiz owners?
Brian Moran: Of the almost 28 million business owners in America, 22 million have zero employees. I consider the majority of these people to be true small business owners. I believe about 30% of the businesses with employees to be entrepreneurial companies. The rest are passionate small business owners.
SmallBizLady: How and when should business owners define themselves?
Brian Moran: The sooner the better. Entrepreneurship is as much about a mindset as it is about running a business. Business owners typically define their paths when they put their business plans together. The operational plan acts like a GPS system. It guides you to your strategic goal. The more specific your operational plan, the less chance there is of getting knocked off course. Additionally, if you define yourself as a small business owner, you’re unlikely to make entrepreneurial decisions when you come to a fork in the road.
SmallBizLady: What are some of the forks-in-the-road that business owners come across and how does it help define you?
Brian Moran: Forks include: hiring a new employee, buying new equipment, opening new locations, entering new markets, raising capital, buying or merging with another company. These are issues mostly dealt with by entrepreneurs. A small business owner gets hurt when they take the path marked for entrepreneurs.
SmallBizLady: Do you recommend getting outside help in defining your business?
Brian Moran: Yes! In most instances, it pays to have an extra set of eyes on what you’re trying to accomplish. Whether you’re a small business owner or an entrepreneur, it behooves you to find an expert in your field to help you avoid the potholes and pitfalls along the path to success.
SmallBizLady: What free resources can you suggest for small business owners to get help that they might not be able to pay for?
Brian Moran: There are many local resources – SBA, SCORE, SBDCs, and Chambers of Commerce all have local chapters and offices around the country. Business owners can also go online to find help with these same groups as well as industry associations or even small business advocates and marketers such as @SmallBizLady’s website www.Succeedasyourownboss.com, OPEN Forum, Intuit, FedEx, Microsoft, Visa, UPS and others.
SmallBizLady: How do you know when it’s time reinvent your business or call it quits?
Brian Moran: The only way you can successfully reinvent your business is by taking a 20,000 foot view of your company. You need to see what the next 3-6-12 months look like. If you’re in a hole, how realistic are your chances of getting out of it? How does the future look for sales, expenses and the overall marketplace? If the 20,000 foot view doesn’t give you any successful options, then you should seriously consider calling it quits.
SmallBizLady: What are the top three success factors for small business owners?
Brian Moran: First and foremost, it’s having a business plan. I’m not talking about the one you present to a bank or VCs; rather a plan that shows you where you want to go (strategic goal) and how you plan to get there (operational plan). The second success factor is execution. You need to have the right team in place with enough resources to carry out your plan. Even if you have a plan, it’s only as good as the people who are executing it. The third biggest success factor for business owners is timing. You can have a great plan and a solid team to carry it out, but if you launched your company in January, 2008 then you couldn’t have picked a worse time to start a business. Take the necessary time to review the economic indicators for your particular industry.
SmallBizLady: All businesses go through cycles, what should you do when you are having a down cycle in your small business?
Brian Moran: Do NOT panic! I recommend going back to the business plan and taking the 20,000 foot view. Did you see the downturn coming? Do you have a sense of how long it will last? Is the downturn affecting just your company or your entire industry? Whatever you do, don’t panic and make a bad decision based on little or no information. This is where you can do serious, possibly fatal, damage to your company.
SmallBizLady: So how should you prepare your business for a disaster?
Brian Moran: Even with recent disasters, both natural and man-made, almost half of all small businesses don’t have a formal disaster plan in place. When disaster strikes, many of the companies without any proper planning will go out of business. Here’s what you need to do: First, backup all your important files and information to the cloud. It does no good if you copy everything to an external hard drive and then leave it in your office when a tornado or hurricane hits it. Second, have a plan to work remotely if you’re out of your office for an extended period of time. This includes you and all of your key employees. Third, have an emergency drawer or even room set up at your business should you be there when disaster strikes. The set up should include flashlights, batteries, candles, matches, fire extinguisher and a basic tool kit and medical kit. For more information on preparing for disaster for your business, visit www.ready.gov. They have additional information on preparing your business for disaster.
You should also consider how you would continue to do business if disaster struck your largest customers, suppliers or partners. When Hurricane Sandy knocked much of the East Coast offline for weeks and months, tens of thousands of companies had to deal with customers who either went out of business or suspended business until they could get back on their feet. Look at your customer list as well as your list of partners and vendors. Are they concentrated in an area that deals with seasonal disasters such as hurricanes, tornadoes or fires? If yes, you should plan accordingly.
SmallBizLady: Any last tips for people trying to survive in business?
Brian Moran: First, define your business to help determine your path. You will find this extremely beneficial when you come to forks in the road. Second, have a business plan that acts like a GPS system so you never go too far off-course. Lastly, have a backup plan. It’s virtually impossible to strategize if the world around you is crumbling down. Stress-test your business plans with worst-case scenarios such as natural disasters, large customers going out of business, theft and more. Figuring out what to do AFTER disaster has struck is a prescription for disaster. It rarely ends well. One more tip – Love what you do and have fun every day. Life is too short for anything else.
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