Women In Business

The differences between being an employee and a business owner

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Thinking about stepping out of the employee role and starting your new business?   There are some strong differences when it comes to being an employee and being a business owner.   Having coached businesses for almost a decade, the most common reason someone goes into business is that they want a lifestyle, good income, but have the flexibility to spend time with their family.   However, in the initial years, this is often not the case … you have either time or money, rarely both until you have ‘made it’.

Here are some open and honest things to get you thinking:

Work Hours.  As an employee you might do a little overtime but generally you’re working a standard day Monday to Friday.   Yes, you may be in a shift work role or work nights, but you have set hours.   As a new business owner, before you become established you will find yourself taking calls on weekends, meeting with clients in the evenings and catching up with admin or bookwork or marketing on the weekends.   Absolutely once you are established, I encourage clients to limit these outside business hour activities and have a bit of a life, however, I wouldn’t be honest with you and say you can get away with a standard 9-5 job in the beginning.

Paid Holidays.   Kiss these goodbye.   Until your business is established and you have staff who work for you and can operate the business whilst you are away, then YOU are the business.    It wasn’t until my business was in its 10th year that I was able to go to Europe for 6 weeks, without a laptop, no phone contact and come back to a business which was still humming.  In fact, I was stunned to see a chunk of money in the bank too!   From about year 5 onwards, I weaned up to this; firstly a couple of weeks out, then a month and finally the 7 weeks (I had a few days off before and after).  I’m not saying you can’t have a break, but to keep things going and maintain momentum, you will at the very least need to check emails.

Switch off and clock out.   This is another big difference between an employee and a business owner – the business owner rarely switches off entirely.   You are down the shops and you run into someone and you’re pulling out a business card from your purse (or wallet).   You attend after hour networking events.   Your friends are often business owners too (you know the expression ‘birds of a feather’) so even socially, you talk about business.   The difference is that those who are passionate about what they do and love what they do, do not see this as work.

You have to think for yourself.   I am not saying employees don’t think, they do but many companies have processes, procedures and support for their personnel.   Often as business owners we don’t have that support, guidance or someone to run things past, which is one (of many) reason that business coaching is so valuable.   You are on your own (without a coach or mentor) so you need to be prepared to step up, learn what you need to know and take responsibility for your own destiny.

Many hats.   As an employee, you likely have your role and a set list of duties and responsibilities.   If you are in accounts, you don’t worry about marketing.   If you are a technician or someone who delivers the service, then you don’t need to strategize the goals and direction of the business.   If you are the receptionist, apprentice or administrator, you most certainly don’t have to worry about the legalities of the business other than to follow any directives given to you.   However, as a business owner, you wear many, many hats.   As your business grows, you will outsource or delegate any of these tasks to others; you may well hire a contract bookkeeper, or employ a receptionist, or have a marketing consultant, but you are responsible for it all, either directly or indirectly.  Even when you outsource or delegate, as the business owner, you absolutely must keep up to date with what is happening in your business and monitor all activities or departments.   I’m not talking micro-manage, but having a business is not set and forget.   Many new business owners are great at what they do (whether that’s preparing tax returns, seeing patients, fixing pipes or installing new LED lights).   You are going to have to learn to be more than a great technician, professional or practitioner; you are going to have to learn business.

Cashflow.   As an employee, you enjoy a regular paycheque.   Depending on your pay cycle (and your boss) most likely the money is in your account every week without fail and you know that you can pay your rent, mortgage, buy groceries or fill the car without stress, worry or concern.   Being in business can be totally different.   You’ve done the job, invoiced it and now you have to wait to be paid.   Certainly, strategies such as pre-payments, deposits, COD, credit card facilities and tight contracts or T&Cs will improve things, but often you have to work twice to get paid.  Firstly, you have to get the business and do the work, then to get the money out of your customers or clients.   Not getting paid can be a big worry for business owners.   Have you got the financial backing to cover this, and especially to cover the first few months as you start the business and money is going out the door faster than it’s coming in?

Business is a Risk.   I won’t sugar coat it, being in business is a risk.   Yes, as I work with clients, I help mitigate those risks by sharing my expertise and experience, but reality is that just running an advertising campaign has an element of risk.   However with risk comes reward.   The skill is in evaluating the risks, minimising them through great planning and research and then measuring how things are going.   A good business owner won’t allow ego or pride to stand in their way of acknowledging something isn’t work and be flexible to change direction.

So, with all the above, let’s see how you are feeling.   When you read each of the above, did you feel a chill run down your spine and a cold sweat break out?   Or as you read those things, did that excite you?   Do you love stepping out of your comfort zone?    Do you possess tenacity, discipline and strength of character?   Are you prepared to work hard to achieve your goals?   Be honest, would you call yourself a ‘go getter’?   If you like comfortable, easy, consistent and safe … then I would suggest that you may not possess all the personal traits of a business owner.    Success isn’t about luck or about the right opportunities falling into your lap – it occurs from hard work, perseverance, the passion of what you do, the desire to learn and grow and most importantly that you truly and fully believe in yourself.

If you believe this is you, I do offer people considering starting a new business and considering business coaching the opportunity to have a free consultation with me which includes a pre-business questionnaire.   Simply contact me through my contact page.   If you have an idea, which I don’t believe is a good one, I will be honest with you; my integrity would never allow me to encourage a bad idea purely to secure a coaching client.   I didn’t get so many rave reviews and so many referrals from being a ‘yes girl’.  With some clients we have those hard conversations that just need to occur.  My areas of speciality are professional services (including other coaches), medical practitioners and building industry tradies.

About Donna Stone

Donna Stone is a business coach with three decades of experience. She grew her own business from a garage to be a multi-award winning operation that spanned five locations nationally. Donna works with business owners and other business coaches, consultants and trainers to help them build their own success. Her Coach the Coach ™ program has proved exceedingly popular. Donna is a prolific writer with hundreds of articles written and six books published. Visit www.donna-stone.com.au

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