The Owner's Manual for Small Business. Rhonda Abrams

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      This year—as every year—over a million people will start a business in America. And many millions more will start businesses worldwide.

      Most will start their companies because they’ve always wanted to own their own business. Some, however, will become entrepreneurs because they’ve been laid off from a job.

      Whatever brings you to entrepreneurship, you’ll quickly find there’s a big difference between being someone else’s employee and working for yourself. Much of that difference is welcome and wonderful. I certainly think so, since I’ve been self-employed since 1986. But, frankly, if you’ve been an employee for a long time—especially for a big corporation—you’re going to find some of the changes are tough to get used to.

      What kinds of changes can you expect when you go from employee to entrepreneur?

      

Money. From now on, every dollar is your dollar. Even if you have investors or partners, at the end of the day, money becomes a lot more real. Whether you’re spending it or earning it, every dollar has a direct impact on your personal income and well-being. Even if you were a conscientious employee, always watching the company’s bottom line, you’re going to find you have new respect for money when you’re the last one paid, and every dollar spent or unearned could have ended up in your wallet.

      Money consciousness is going to take a number of different forms. First, you’re going to view expenditures a lot more carefully. For instance, if you worked for a Fortune 500 company, you probably didn’t think a great deal about how much you spent on office supplies. But when you have to earn every dollar yourself, and you understand how hard money is to replace, that $29 label maker may seem an unnecessary luxury, especially when you know the same $29 could be used to buy clothes for your kids.

       From now on, every dollar is your dollar.

      

Control. This is definitely a two-edged sword. One of the best things about being your own boss is that you get to make the decisions. You no longer have to follow seemingly senseless corporate mandates. But with control comes responsibility, and you’re going to find you have to make oodles of decisions.

      There are the big decisions when you first start, such as what kind of business to go into, what kind of financing to look for, where to locate. But the hundreds of smaller choices can be just as intimidating—whether or not to exhibit at a trade show, what kind of insurance to buy, when to hire employees, which tasks are most important, and on and on. It can be exhausting, rather than exhilarating, when so many decisions end up on your desk.

      

Humility. Few things instill as much pride as earning your own living. When you do that in your own business, you have the right to be especially proud. But with that pride comes a lot of other stuff too, such as running the errands, stuffing the envelopes, apologizing to obnoxious customers, emptying the garbage. I once heard about a man who was self-employed just one day: when he went to start work and realized there was no one else to order a desk or phones, he quit.

      

Risk. Perhaps the biggest change of all is going to be your relationship to risk. When you’re an employee, you’re concerned with taking care of your career, and it’s typically wiser to take fewer risks and thus make fewer mistakes. In your own business, however, taking fewer risks and doing less isn’t an option.

      If you think these differences seem overwhelming, don’t be completely put off by the idea of becoming an entrepreneur. One of the greatest benefits in going from employee to self-employed is that you discover a lot about yourself, including the many talents you never realized you had.

It’s the Little Things

      Here’s a quiz: When you meet someone new, what’s the second question you’re most likely to be asked? Answer: “What do you do?” It’s not just to figure out whether you’re a welder or a writer—it’s to determine how important you are. For the self-employed, that question can be tough on the ego.

      In America, we associate status with our jobs. We feel good about having a fancy office or important job title. Even if we have an entry-level job, if we work with a big company, we often feel a sense of reflected status from the name of our employer.

      So when you go from employee to entrepreneur, giving up the trappings of status and success can be tough. And it can be the little things that make you most uncomfortable: standing in line at the post office instead of going to the mail room, buying your own office supplies, answering your own phone.

      Even good things can make you feel awkward: giving up ties or pantyhose, going to a child’s school in the middle of the day, not having to report to anyone.

      Even more frustrating—though you’ll get over it—is when you make a lot of money, but no one knows how well you’re doing. After all, you still work at home and wear jeans. I had worked for myself for seven years before my friends took me seriously. What changed their impression? I got my first overseas client. Trust me: when someone pays you to go to Australia, you suddenly get respect.

      But I knew I was serious long before that. Although I had given up a job where I had an office with a view, assistants, and an expense account, I didn’t miss any of it (well, maybe the expense account). Part of the reason is that early on, I took some steps to make myself feel good about being self-employed.

      I set up a part of my living room as my “office,” printed up business cards, and changed the way I answered my phone (from “Hello” to “Rhonda Abrams speaking”). More importantly, I found a symbol—a status symbol—to remind me of my importance.

      For me, it was flowers. My first couple of years in business, I didn’t have much money and every penny counted. I lived on cheap spaghetti. But every week, I bought myself flowers for my desk. Somehow, looking at those flowers made me feel like I’d arrived at a “real” office.

      Little things matter. You can’t afford the assistant, you won’t necessarily have a separate room for your office, and if you travel, you’re going to take economy instead of business class. But you can find a number of little ways to remind yourself that you’re now the owner of a business.

Status Symbols for the Self-Employed

      

Business cards. Absolutely! You can’t exist without them. They are a must!

      

A telephone line just for business calls. This is especially important if you live with others.

      

Name your company. Even if you choose “Chris Smith and Associates,” you’ll feel more like you’re in business with a business name. (But keep in mind that if you use any name other than your own, including “and Associates,” to be perfectly legal, you may have to file a DBA (“Doing Business As”) statement with your local county, city, or state.)

      

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