Do you own a business or a job?

Many entrepreneurs have put themselves in a position to own a job, whether it’s just them in the business or having 50 employees.

As someone who supports blue collar businesses, I too often see a business that has been around for many years, and then there is nothing of value to sell or transition to in the end.

This article aims to provide the solopreneur and entrepreneur with some things to consider in order to create a business that has value and can be sold or transferred at some point.

Here are the top three things small business owners do that don’t help them build a business.

Do you have sufficient metrics for a bank to be willing to provide a loan to the business, not you personally?

You don’t need to spend hundreds of dollars a month to create a good financial position for your business. Yes, there are benefits to using QuickBooks or other tools; a simple excel file can also do the trick. The key here is to be disciplined.

The most important opportunity is to separate all personal activities from business activities. So many LLC owners never take this step. Having a business credit card, bank accounts, PayPal, Venmo, and Amazon business accounts are all things that will help show a bank your actual cash flow and income. Yes, your “tax expert” may say it doesn’t matter, it may be true today. However, bad habits created today become harder to break the longer you have them. A great resource to consider is “Profit First” by Mike Michalowicz, a simple financial system that can have a significant impact on your business.

There are additional benefits to separating individuals and businesses. When you buy a car or a house, your Schedule “C” for taxes may not be sufficient for the lender. With the rise of self-employment, these small decisions can create a lot of stress and anxiety for you and your loved ones.

How long can you be away from your business and still be in business? Yes, many owners are also the service provider and trade time for money and can’t imagine taking time off. And it is an important value factor when we calculate trade values. If you are involved in every detail, you are also an employee.

One way to move away from employee status is to seek support from virtual assistants (VAs) or other places like Upwork or Fiverr. If you are “how” to everything in your business, you have a job, no matter what you think. A great read is “Who, Not How” by Dan Sullivan.

Being clear about your areas of genius is a critical step to unlocking the full potential of being a business owner. Too many people want to do it all, nobody can do it better than you and I don’t have time to practice. All of this may be true – and my question is, what is the cost of your “perfection and control”? What could you do with that time instead?

Try this simple exercise:

  • Keep track of all your activities for a week
  • Put your cost next to each of the tasks
  • At the end of the week, write down what you didn’t do
  • Put your lost costs/income on each of those tasks that weren’t done
  • What did the results show you?

Ask yourself: would you pay someone the costs of the tasks you performed as a business owner? I guess you are paying over 50% to do your job.

There is an underlying fear of being focused on a narrow path. Here’s the hard truth: If you’re everything to everyone else, you’re nothing. By trying to do everything, you don’t become memorable, you don’t have a clear message, and you can’t be good for anything.

As a business owner, you should want to be number one at something. It creates pride in you and your brand.

Here’s an example: you may be the number one accounting firm for automotive enthusiasts in southeast Wisconsin. Sounds strange, right? However, everyone knows that you are the auto people’s accountant. Is it bad? Not at all. You and your staff have a clear message. Your BNI networking partners, groups and networks know what you are expert at. There is now a differentiation between you and the hundreds of other businesses in your area.

Overcoming the fear of “excluding” others in your message is difficult, and it can take several months to understand and be comfortable with it.

Ultimately – let’s face it – business owners have egos and being able to nurture ego and pride knowing you’re number one is a huge win and added value for your business.

Others will come, and being transparent in your message tells everyone you know how to help and the people you enjoy working with.

These are just a few of the things that small business owners often don’t spend enough time on. Resolving and clarifying each of the points above will add value to your business and help you separate ownership from employee. If you’re unsure whether or not you own a business or a job, come to the Idea Collective and we’ll help you figure it out!

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