BECOMING A BUSINESS OWNER

People often think that being a business owner is all about having stacks of dollars, being the
boss that barks out orders in a company, and living a stress-free life. This is hardly true. Business
owners are the ones responsible for organizing systems for the production, distribution, and
consumption of goods and services. They build systems while leading and growing the people
within them. Being a business owner is both risky and rewarding.

Be sure that as risky as being a business owner is, the rewards are juicy. Owning a business is a
sure way to financial freedom. If you play your cards well, not only do you get to retire early but
also have an opportunity to build a lasting legacy.

Let me elaborate on the risks and rewards so you can appropriately choose which of the three
ways to become a business owner suits you best.

Start Your Own Business from the Scratch

This is for those who are capable of handling 'the unknown.' They are mostly visionary- as
starting anything requires having a vision of what the end would be. This person identifies a
problem and comes up with a unique or existing solution. To succeed, they have to come up with
better ways to deliver their goods and services other than the ones already existing.

People who start their business from scratch have the tenancy to work against all odds, work
alone, or with a small group of people. Their business idea excites them, they are extremely
focused, resilient, and are willing to conquer any business adversity. They are willing to spend
money to make sure their business gains ground and functions above other competitors.

Startups require capital to start running effectively. People who go into this either have a deep
pocket or will take loans from banks, family, or friends.

One great thing about starting a business from scratch is that you acquire lots of skills as you
grow. These skills can be applied to other ventures.

Buy an Existing Business

This is less risky than starting your business from scratch. There is more security here. A laid
down system of generating income, existing employees, existing customers, and maybe an
existing building are some of the benefits of buying an existing business.

The person you are buying the business from left an already set up payroll plus a building with
all the necessary equipment needed to run the business. Financially, the business has cash flow,
past record of sales, and income so it won't be hard if you decide to get a loan from the bank.

Buying the business gives you the right to make changes in it. You could make changes that will
make it run better, have smoother operations, and be more advanced.
I advise you to have background knowledge of the business you are buying because the better
you know it, the higher your probability to run it better than the former owner.

As you decide to buy one business, you might as well acquire more. This is a powerful way to
scale your economy and achieve growth faster. Acquisitions and mergers are strategies used by
big corporations. Shouldn't you apply it to your business too?

Franchise ownership

Starting your business fro match may seem intimidating and buying an already existing business
may not be comfortable. You could be suited for acquiring a franchise.

Acquiring a franchise would make you a franchisee. You pay a sum of money to the franchisor
to be endowed with the right to use his trademark, brand name, a system of doing business, and
his ongoing support. You also pay royalties continually as you go to the franchisor. By paying
royalties, I mean a part of your sales. Franchisors provide support by giving training and their
long time tested models of business. Franchisors could also give you loans.

Deciding a Legal Structure for your Business

An important decision you should make that relates to taxes is the kind of legal structure you
choose for your company/business. This decision will affect how much taxes you pay, the
liabilities you face as a business owner, your ability to raise money, and the degree of paperwork
you would be required to do for your business.

Legal forms of business you could choose from are; sole proprietorship, limited liability
partnership, and Limited Liability Company.

Each of these business forms come with different types of tax consequences. You have to make
your choice wisely and select the appropriate one that matches the needs of your business very
well.

Legal Structures of Businesses

1. Sole proprietorship: In this, the business owner is responsible for all profits and debts of
the company. It is the simplest form of a business structure. It does not offer protection or
separation of both professional and personal assets. This might be an issue as your
business grows and there are more aspects to hold you liable.
2. Limited Liability Company: Here members are called LLC owners. They can either
hire professional managers or manage their business by themselves. Limited liability
companies enjoy flexibility like they can have as many members as they want,
corporations are permitted to be members.
 3. Limited Liability Companies do not pay taxes but their losses and profits pass through the
members' individual tax returns. Therefore, members are able to avoid double taxation
and also tax relief from poor performances of their limited liability company.
4. Limited Liability Partnership: They have the same tax advantage of Limited Liability
Company but they can't have corporations as members. LLPs need to have at least one
partner who will bear the liability for partnership's action. This person is as legally
exposed as sole proprietorship owners are exposed. The rest of the partners receive
protection from liability as long as they are not managers in the company.
5. Closed Corporation: The members here are like shareholders. The company is easier to
administer and cheaper. The business could mature but only 10 people are permitted to be
members.

Typical profile of a business owner:

Knowing a business owners' gender, age and company size does not reveal who they really are or
what made them start their business at first or their entrepreneurial journey. There are four
profiles that qualify a business owner;

1. Passionate: Their passion made them start the business they are into. They are believers
and this is a very crucial quality of a business owner.
2. Independent: They have the independence of mindset. They are able to get things done
even when no one backs them up.
3. Builders of Legacy: Bringing a new trend to the market is setting them apart to carve a
path in legacy building.
4. Survivors: This is a strong characteristic of a business owner. They are resilient and able
to conquer any raving circumstance.

Are you ready to give up your job to be a business owner? Here are some key considerations:

1. Savings: As you quit your 9-5, you won't be getting a steady salary. Ensure you have
enough to get you by.
2. A ready market: If you don't have customers that are willing to patronize your service in
business, do not bother quitting your job.
3. A realistic Business Idea: Ensure your business is marketable before quitting your job or
else you would be stranded.
4. Are you ready for the unknown? You are launching into the unknown of multiple
possible setbacks. Be sure to be mentally prepared.

Remember - there is no overnight success. It takes years and months of dedicated hard work,
learning, failure. This is the real joiner of a business owner.