Starting a business can be very beneficial but you always face a lot of uncertainties and risks. Learning about pros and cons of business prior to formation will enable you to determine the chances of survival of the business.
1. Freedom: Opening your own business gives you the freedom to be your own boss, make your own decisions and you’re not limited to the position you hold in a company. The only person limiting your growth is yourself.
2. Personal and professional benefits: Having your own business is very flexible. You can determine the number of hours you can work, where to work at and also the work environment.
3. Nurture talents: You can easily start a business out of your own interests and hobbies and this makes it easy to grow a career in something you like.
4. Financial gain: Starting your own business has higher chances of increasing financial rewards as compared to working for someone else. An entrepreneur creates more wealth through the establishment of a business.
5. Control: As an entrepreneur, you will have total control of the business. You can bring in creativity and innovativeness into the business, be involved in the business operations and maintain a close contact with the customers.
6. Prestige: There is some pride and respect associated with owning a business. People are motivated by being recognized as the person in charge or the boss.
7. Helps in job creation: Starting your own business not only benefits you but also opens the opportunity to others and the society at large. An entrepreneur can offer job opportunities to others and also participate in building the local economy.
8. Security: You have job security and can be able to control your own destiny. Your success as an entrepreneur depends on your ability to add value to the products you offer to your customers and the current market trends.
9. Choose who to work with: When you start a business you can choose the people you want to do business with. You need positive people to help you build your confidence and move forward in business.
10. Learning opportunities: You will be involved in all aspects of the business increasing chances of learning in various business activities.
1. Long working hours: Starting a business will prompt you to work long hours to make the business succeed. This commitment of time to the business can create a strain on your family.
2. Health complications. Working for long hours can have a negative impact on your health and you need to come up with a balance between your business and private life.
3. Inadequate finance: Entrepreneurs rely on loans from a financial institution and they must secure the loan through personal assets and this increases the cost of starting the business.
4. Risks: Risks are inherent in nature and cannot be 100% forecasted. You may face a lot of risk in the business but you can come up with strategies to minimize the impact the risks will have on the business.
5. The stress of business uncertainties: Business downtowns, competition and changes in customers’ needs can affect the business. Some of these uncertainties from external factors cannot be quantified and you have no control over them.
6. Failure: there are higher chances of business failure if the entrepreneur doesn’t take appropriate measures to strategically position the business in the competitive environment.
7. Poor decisions: You deal with all the problems in the business on your own and any bad decision made will have a negative impact on the business.