Financial Literacy - Careers
5 ways to crash your small business

Treat the business like any other job

Employees who make the leap to entrepreneur can fall into the trap of treating their business as a job they've created for themselves.

Treating your business as any other job -- except you get to be the boss -- undermines the enterprise.

"Rather than seeing the business as a separate entity from themselves that has revenue and expenses that include their salary, profit margins and income, they really see it as a situation where, 'If I'm charging $1,000 then I get to keep $1,000 minus a few things,' " says Wendy Vinson, president of E-Myth Worldwide.

"And that really is very much a technician or employee point of view, but they're trying to run a business that really has a whole other set of principles," she says.

Being inspired by the work they love can push people to take the leap into their own business. But running that business requires a different set of skills from the work they began. Sticking to the same mind set that makes a successful employee will not make a successful business owner.

Luckily, the set of skills it takes to run a successful business can be learned in classes, from books and from counselors at small-business resources such as SCORE, a Washington, D.C.-based consulting service to small-business owners and entrepreneurs.

Dreaming big comes naturally to most entrepreneurs, but business acumen is something that has to be honed and practiced.

When small-business owners don't understand what they're doing, why they're doing it and how they differentiate their businesses from everyone else, it can be difficult to keep the business going when times get tough.

When things are going well, it can be too easy to lose sight of what is working if the person in charge doesn't understand what's driving his or her success.

Whether it's great service, reliability or a unique product that works, knowing the business backward and forward will help owners grow and sustain the business in good times and bad.


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