The question people forget when starting a small business is “can it make a profit?”
It’s the most important factor as to whether or not a business is going to make it.
I serve on the Advisory Council for the College of Business at Eastern Kentucky University. At a recent meeting, we brought in Dr. Janet Kelly from the University of Louisville.
Dr. Kelly did an outstanding job in giving us the good, the bad and the extremely ugly data about Kentucky’s economy. She noted a statistic that fascinated me.
Kentucky is one of the top states for creating small businesses with five or fewer jobs. Most of them don’t turn a large profit.
The statistic disturbed me on many levels.
In my book “Wealth Without Wall Street” and in numerous columns, I’ve promoted the idea of owning your own business. I’ll be going into my 30th year of self-employment in September. I can’t imagine doing anything else.
Self-employment fits my personality profile. I’m a compulsive worker who doesn’t want a lot of supervision. Just show me the goal line and I will get there.
I tried corporate life and it didn’t work for me.
I spent two years as president of a large company.
I concluded that I hated the job and the people I worked for hated me. The layers of bureaucracy drove me crazy and my desire to break down those layers drove my employees crazy.
I can’t see myself ever running a large corporation again.
As KT Oslin once wrote, “I said 'I do' and I signed 'I don’t' and I swore I would never do that again.”
I also understand why people get into small businesses that don’t make a lot of money. They want to do something they enjoy or something where they can make a difference.