The Advantages of a Small Business
Starting a new business is an aspiration of many people who dream of turning a passion into a livelihood. Launching a new small business is risky, even for experienced entrepreneurs, but running a small business can also be rewarding. Small businesses often face stiff competition from larger, more established businesses, but small businesses offer several potential advantages over larger businesses.
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Control
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One of the primary benefits of a small business is that the entrepreneur has control over all aspects of the business. Larger companies have bureaucratic tendencies that can make it difficult for decisions to be made and for change to occur. Board members may disagree on issues and CEOs are constantly fired and hired. According to the U.S. Small Business Administration (SBA), the vast majority of small businesses start out as sole proprietorships. Sole proprietorships give the owner total control over the business within the parameters of the law.
Human Resources
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Another advantage of a small business is that in a small company, all workers in the company will know one another. There is often no need for different offices to communicate with one another or for workers to travel from one facility to another because small businesses may not have more than one office or facility. A small workforce allows the CEO to get to know the strengths and weaknesses of each worker, which can help him optimize human resources.
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Complexity
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Large corporations are often complex entities with a wide array of products and services and operations in many countries around the world. The complexity of large businesses means they might not be able to devote as much attention to specific types of products or market niches. Small businesses have the advantage of being able to focus on doing a few things well rather than trying to do dozens of different things at once. According to the SBA, sole proprietorships are the "easiest and least expensive form of ownership to organize."
Personal Benefits
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Small businesses can offer several personal benefits for their creators. First, all the work that you do to grow your small business will benefit you directly, whereas managers of large businesses may not be paid more even if their efforts help the business. Second, small business owners can choose their own hours, allowing for more flexibility than many traditional jobs. Another benefit of owning your own small business is that many business-related expenses such as the cost of owning a home office, business transportation costs and the costs of goods sold can be deducted from personal income taxes. According to the SBA, starting a small business also offers great earning and growth potential as well as many opportunities for learning.
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