Phil Friedman

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Five Myths Perpetuated on Social Media About Small-Business

Five Myths Perpetuated on Social Media About Small-Business

SOCIAL MEDIA IS RIFE WITH SMALL-BUSINESS MYTHS, FOSTERED MOSTLY BY PEOPLE WITHOUT RELEVANT REAL-WORLD EXPERIENCE...


Early to bed, early to rise, makes a man healthy, wealthy, and wise...

Benjamin Franklin in Poor Richard's Almanac

It's often said that small-business is the backbone of the U.S. economy. And with the growth of interest in entrepreneurial activity over the past decade or so,  small-businesswhich is incorrectly seen as a breeding ground for entrepreneurshas taken its place in the phalanx of American Mythology.

Five Myths Perpetuated on Social Media About Small-Business


From the publishing of "Poor Richard's Almanac" by historical icon Ben Franklin, to the ever-growing multitude of contemporary food and beverage, cleaning and maintenance, and sports and recreation franchisees, romantic flirtation with small-business has transformed into virtual obsession. And, as with most religious creeds, the new cult of small-business has created, and supports its own body of faith-based dogma.

Myth #1Starting a small-business is a great way to deal with being unemployed...

Well ... not necessarily. And, of course, only if you are successful. But will you be?

If you're unemployed, then you aren't running a small-business now. You may have run a small-business in the past, but obviously, you weren't wildly successful at it ... or you'd likely still be doing it, which you're not.

According to the U.S. Small Business Administration, which has likely compiled more information on small-business than just about any other source, starting a small-business generally requires at least a modest initial capital investment, whether for facilities and equipment, or for operating expense during the early start-up phase, when revenues may be low or non-existent.

However, if you've been moving through a period of unemployment, and you're now being driven by a failure to find new employment, you are not likely to be in a position to properly capitalize the start-up of even a very small business. And it might well be wiser to take a job (or two) doing something you might not really want to do, while you pay your living expenses and accumulate a small-business start-up fund.

Myth #2You can start a small-business solely on "sweat equity"...

Five Myths Perpetuated on Social Media About Small-Business


Sweat equity is what you build up by putting work into a small-business start-up without being paid a salary, or anything at all, by the business.

Sometimes it's thought that a small-business can "boot-strap" itself into existence, purely by the investment of sweat equity. Well, sometimes it can. But more often than not, it can't.

Sweat equity is always required in order to minimize cash outflows, until cash inflows reach a level that will support the day-to-day operational direct and indirect overheads in involved in running the business.

You can do sales work for your new small-business without pay, but you cannot pay for telephone and internet service by sweeping floors for the utility company. You can do your own bookkeeping without paying yourself for doing it, but the guy who is going to print your fliers and brochures is not likely to be willing to trade you out for your washing his windows. And there is little doubt that you will have to eat, clothe yourself, maintain transportation, and keep a roof over your head. Yet, most vendors of food, clothing, auto fuel, and housing refuse to take bottles of perspiration in exchange for their wares.

Again, your potential for success in starting and operating a small-business goes up dramatically, if you have accumulated sufficient available capital to finance that business during its early start-up phase.

Myth #3Owning and running a small business is a terrific lifestyle alternative to being employed by someone else...

Five Myths Perpetuated on Social Media About Small-Business

There is a very old saw that goes:  If you faithfully work really hard as an employee eight hours per day, five days a week, for ten dollars per hour, and do a top-rate job, eventually you will get the opportunity to run your own business, work doubly hard, twelve hours per day, six or seven days a week, and make five dollars per hour.

Okay, so the outlook on owning and running your own small-business is not that bleak. But there is some truth in that old saying. Starting and running a small-business from scratch almost inevitably requires a greater input of effort and time than simply working for someone else.


Additionally, when you run your own small-business, you carry all the responsibilityand risk, and associated worry on your own shoulders. Often to such an extent that you may find little time to relax, may fall into neglecting your family, and may think constantly and obsessively about sales revenues, marketing, finding new customers and clients, keeping the office machinery running, getting the computer software up  and running, making this week's payroll (if you have employees), and any number of other things that will work to keep you up at night.

Owning and operating your own small-business can work out to be great, beyond your wildest dreams. But then again, it also might not. If you don't have drivers other than simply wanting to be out from under the supervision (constriction) of a "boss" drivers such as wanting to be solely responsible for your own success or failure, wanting to development and implement your own ideas and realize the fulfillment of your own talents, and wanting to work in a field solely of your own choice at something that you ultimately love to do then you should think more than twice about striking out on your own. For maybe that well-paying, forty-hour-per-week job ain't so bad after all.

Maybe you should let somebody else worry about making payroll. Or worry about where new customers and clients are to be found and wooed. Or about the year end financial statements and paying the company's taxes. Or defending against the unfair employment practices suit, filed by a labor lawyer whose own business suit costs more than the car you're able to afford to drive.

Myth #4 — Running a small-business provides flexibility in your working hours, as well as the freedom to indulge in "social responsibility"...

Five Myths Perpetuated on Social Media About Small-Business


This is a myth only a Millennial could love ... or believe. True, if you work for someone else, you generally have set hours during which you have to be present at work, and usually on site  although this is to a degree changing in the workplace with the increased popularity of working online or remotely at least part of the time.

But with a small-business, generally if you're not on deck, nobody is. And that often means you end up more firmly rooted to your work, and less able to "shut it down" than you would be if you were someone else's employee.

It's also true that as an employee you can at times come under pressure from your employer or from managers to whom you report to conform to some idea of "corporate social orthodoxy".  Whatever that means or involves.

But don't kid yourself, as a small-business owner/operator, the pressure of having to not offend your customer or client base is just as strong, if not more so. At least when your business is in its early stages of start-up.

One of the defining characteristics of small-business is that it does business at a much more personal level, and so depends even more heavily on maintaining good public relations. And because the constituency of a small-business is so much smaller and likely more homogenous, as well as more sensitive to personal engagement than that of big-business, it's easier to find yourself in big trouble with significant portions of your customer base, for reasons totally unrelated to the product or service you market and deliver. How that translates into greater freedom to exercise social responsibility is beyond me.

Myth #5 — You can "fake it, until you make it"...

Five Myths Perpetuated on Social Media About Small-Business


Notwithstanding that this was said in print by celebrity entrepreneur Richard Branson or at least postulated by a ghost writer whom he employed to effect some of his social media presence it's not a development strategy of choice for a small-business.

As a small-business person, you will have fewer colleagues backing you up, and far fewer covering up for you. So it is much to "learn on the job."  And your mistakes will be much more obvious to your customer or client base, than they would be if you were employed in a large firm, where you can much of the time hide in the bushes.

No, in a small-business environment, mistakes are not only costly, they are so many times more difficult for your reputation to absorb, that the importance of having adequate training, skill, and experience is greater, not less than it is in the context of big-business.

None of which should discourage you, if you are truly meant to be a small-business person...

Please understand that I am not here trying to discourage you from entering the world of small-business ownership and operation. Indeed, I personally have spent the majority of my adult working life as an independent small-businessman and consultant. And although I haven't gotten rich in the process, I've managed to make a comfortable living. More important, I've always liked doing what I do, and never awakened in the morning feeling the palpable dread of having to go to work that so many in the world of employment unfortunately experience.

No, I am only exhorting you to be realistic about your expectations, and what it will be like. For unfortunately, the nature of social media in our time is that just about anyone can pose as an "expert" on anything, even when he or she doesn't have a lick of relevant real-world experience with the subject or topic. If you unreflectively accept the pronouncements of such people, you are very likely eventually to come up hard against the brick wall of reality. —  Phil Friedman


Author's Notes: If you found this article of value, you may want to take a look at some of my other writing about small business operations, management, and marketing:

"Small Businessman's Primer to Inbound Marketing"

"Selling Bull Chips in a Bag"

"Maximizing Throughput on Fixed Assets and Overheads"

"Small Businesses Need to Keep a Close Eye on Gross Profit"

And if you would like to discuss marketing or other issues you face in your efforts to join the ranks of small-business, email or message me to arrange for a free, no-obligation, 1/2-hour initial consult.


To receive notifications of my writings on a regular basis, click the [FOLLOW] button on my beBee profile. As a writer-friend of mine says, you can always change your mind later.


Feel free to "like" and "share" this post and my other LinkedIn articles — whether on LinkedIn, Twitter, Facebook, or Google+. I ask only that you credit me properly as the author, and include a live link to the original work.


If you are interested in yachts, are allied with the yacht building industry, or operating a small business in another sector, you should consider joining my beBee Hive,

THE PORT ROYAL GROUP for Yacht Builders, Buyers and Owners

where you will find experienced industry professionals discussing a wide range of topics. The ongoing conversation is always interesting, informative, and 100% industry insider.


About me, Phil Friedman:
With 30 some years background in the marine industry, I've worn numerous hats — as a yacht designer, boat builder, marine operations and business manager, marine industry consultant, marine marketing and communications specialist, yachting magazine writer and editor, yacht surveyor, and marine industry educator. I am also trained and experienced in interest-based negotiation and mediation. In a previous life, I taught logic and philosophy at university.


The (optional to read) pitch: At www.learn2engage.org, we help you improve your reasoning skills and thinking abilities, and as a matter of course, thereby help you improve the quality of your writing. Instruction is handled directly by yours truly, both over the internet and in person, both one-on-one and in small supportive groups.


Five Myths Perpetuated on Social Media About Small-Business

For more information and to arrange for a free 1/2-hour consult, call or email info@learn2engage.org.


Five Myths Perpetuated on Social Media About Small-Business

Images: Stuart Miles, FreeDigitalPhotos.com, GoogleImages.com, and Port Royal Group


Five Myths Perpetuated on Social Media About Small-Business



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Comments
Phil Friedman

Phil Friedman

4 years ago #22

#26
Thank you, Praveen Raj Gullepalli, for the kind words, and for reading and taking the time to comment. Cheers!

Phil Friedman

Phil Friedman

4 years ago #21

Randy Keho #24 , you make a good point. Most "investors" in small businesses take on that role for reasons other than simply earning a return on their money. They may be a relative who loves you and can't say no. They may be a friend who feels obligated to help. Often, they don't expect big returns. But they usually expect to recoup their investment over time. Thanks for reading and commenting.

Randy Keho

Randy Keho

4 years ago #20

Most of the small-business owners I've had the pleasure to work with have at least one partner,usually a silent investor or two. Therefore, you're not just working for yourself. You have what big-business refers to as stockholders, and oftentimes they're friends or family members. They expect to be fed. Many friendships are strained or lost as a result of the business going sideways or down. If you've fed them a line of crap, regarding the viability of your venture to get their financial backing, don't be surprised when they pull the plug to stop the bleeding. Family gatherings just won't be the same after that, assuming you're still invited.

Milos Djukic

Milos Djukic

4 years ago #19

#22
Myth #6: What is congenital due to creation does not have to be changed :) I had the most work to do with itself.

Phil Friedman

Phil Friedman

4 years ago #18

#17
Thank you, Milos Djukic, for saying so. Of couse, the downside is -- as one of my perreennial critics puts it -- I lapse into lecture mode all the time. Well, truth be told, I was both a good, and a very popular teacher during my tenure in academia. So, my reply to that criticism is nobody forces you to attend the lecture. Seriously, though, I try to work very hard, sometimes without success, to avoid being arrogant or pompous. But that's a matter between me and my maker. Cheers!

Phil Friedman

Phil Friedman

4 years ago #17

#16
@Vincent Andrew - Thank you for reading and for taking the time to say so. I'm pleased that you found the piece of value. The compromise that you've reached for yourself appears to be a good one. And if eventually the urge takes over to become entirely the master of your own fact, you will have the basic understanding and experience to avoid a good many of the pitfalls involved at the inception of a new small-business. Cheers!

Phil Friedman

Phil Friedman

4 years ago #16

Thanks, Jim Murray, for bringing that important perspective to the conversation. (Not being sarcastic; it's true.) The single most consistent feature of running your own small business is that you can expect to absolutely work your ass off. So, you'd better make sure it's doing something that you really like to do. Other than just count money. Cheers!

Phil Friedman

Phil Friedman

4 years ago #15

#14
Good point, Don Kerr, many small-business people whom I've known rarely take long vacations, partly because they can't be away from managing the company, but also partly because when you're paying for the missed time yourself, getting away often has less appeal. (Not that it is a good thing.) For me a big game changer was the cellphone and especially the smart phone, which enable me to conduct business from wherever I'm at. It used to annoy my wife that we'd be walking the trails, say, on Whistler or Blackthorne mountains in B.C., and I'd have to stop to take a telephone call from an anxious client. But then we both came to agree that the disadvantage of not being able to really get away entirely was outweighed by the advantage of being able to get away more frequently and for longer periods of time. Not to mention that, from time to time, my wife can tag along at economical cost on a business trip to an interesting locale, because I am traveling at client expense. Thanks for reading and commenting. And for joining the conversation. I believe that the real value of a piece like this is in the extended discussion to which experienced people like yourself contribute. Cheers!

Phil Friedman

Phil Friedman

4 years ago #14

#13
Yes, Wayne Yoshida, i too grew up with a father and a grandfather who were small-business people. But in their cases it was mostly a struggle. And yes, I've known many small-business people who have done better financially than most who work for others do. As you correctly perceive, this post is mostly a reality check -- against, if I may say so, so much of the silly stuff about small business that I see propagated on social media. Thank you for reading and commenting. Cheers!

Milos Djukic

Milos Djukic

4 years ago #13

You're born professor Phil Friedman, sharp, precise and concise in inspired writing and talking (I believe).

Jim Murray

Jim Murray

4 years ago #12

Atta boy Amigo. You're right on the money as usual. I've been running a small business for 25 years and it's either feast or famine. When it's feast you're working 12 hours a day to keep up. When it's famine, you're working 12 hours a day to find a feast. It really sucks but it's addictive as hell, because it challenges you 24/7. Anybody who tells you any different is some sort of slacker.

don kerr

don kerr

4 years ago #11

Bingo and bang on Phil Friedman. Been doing this for 14 years and still awaiting my first paid vacation!!!

Wayne Yoshida

Wayne Yoshida

4 years ago #10

Excellent post, Phil Friedman. My dad was an entrepreneur. Back then, it was called small business ownership. I also remember the many times all of us kids were disappointed by the things we didn't get since all the family budget money was tied up in one of his ventures. The big takeaway​ is the reality check, since I do know some successful folks who made it being their own boss.

Randy Keho

Randy Keho

4 years ago #9

#10
Spot on, again Phil Friedman I spent 15 years in the linen and uniform business, which was founded by the good fellas who send the goons. In reality, today's corporate goons are even more persuasive than the big, hairy connected apes. We were union. You know they're good fellas.

Phil Friedman

Phil Friedman

4 years ago #8

#8
BTW, Randy Keho, I neglected to say thank you for the kind words, and for bringing to my circle of online friends your edgy authenticity and seriously experienced views and Boomer stories. My best to you.

Phil Friedman

Phil Friedman

4 years ago #7

#8
Yep, Randy Keho, in the restaurant and bar trades, among other things, you need to deal with big, hairy connected apes who dominate the services for linens, liquor supply, uniforms and laundry, etc., etc. Years ago some very close friends of my mother and Sicilian step father owned a private "key" club near Rush Street. They had built the business over 25 years, and were finally really enjoying the fruits of their labor. When one day several goons came in to announce they were henceforth going to have partners. Well, it ain't like it is in the movies or on television. The goons are not charming, nor do they have an ounce of conscience. So they were faced with partnering up with people you don't argue with. The next day, they turned out the lights, locked the doors, and walked away. Eventually, moving to Arizona. So much for 25 years of work. Cheers, my Chicago friend!

Phil Friedman

Phil Friedman

4 years ago #6

#6
Thank you, Donna-Luisa Eversley, for reading, commenting, and sharing. Don't misunderstand, most, if not all of us small-business people originally operated under these delusions. It's just that the older among us got them beat out of us by the real world. Cheers!

Randy Keho

Randy Keho

4 years ago #5

Spot on Phil Friedman Your knowledge and insight are priceless. I almost got into a three-man partnership to own a bar. All they wanted to do was invest. I would have had to do the heavy lifting. When I told them they better keep their wallets open, they changed their mind. The location was horrible and somewhat dangerous. You know the story around Chicago. There's more involved than just pouring drinks.

Phil Friedman

Phil Friedman

4 years ago #4

#5
Thanks, Paul \. I know you understand because you've been there, done that. To my mind, too many are lured into starting small businesses based on unrealistic expectations and pre-doomed hopes. Sometimes, I think, because they listened to too much baloney from social media "experts" who really haven't a clue. Thank you for reading and commenting. And for Tweeting. Cheers!

Phil Friedman

Phil Friedman

5 years ago #3

#3
Thank you, Gert Scholtz, for the kind words, and for reading and commenting. Cheers!

Gert Scholtz

Gert Scholtz

5 years ago #2

Phil Friedman Another of your straight-shooting posts! From someone who has been there. Thanks

Phil Friedman

Phil Friedman

5 years ago #1

#1
@Christienne Miller - Thank you for reading and commenting, and for the exceedingly kind words. They are what make the effort of writing worthwhile. Cheers!