Why consider owning a micro-business
Micro-businesses (also called micro-enterprises or Very Small Businesses) are usually defined as a business with five or fewer employees (The Association of Enterprise Opportunity, 2005). Many of these businesses have no employees at all, just the self-employed owner. Micro-businesses are often associated with poor people in developing countries just trying to survive. But anyone who wants extra income, more control over their income and their life, or wants to spend their time earning a living doing something they like are potential micro-business owners (a.k.a micro-entrepreneurs).
A micro-business is usually larger and more complicated than a micro-income stream. Check out “Multiple Micro-Income Streams are Critical to Financial Self-Reliance” if you want more information. Personally, I like micro-income streams more. But that’s just me.
A large component to living a Self-Reliant lifestyle is creating a sustainable way to make money. Like it or not, some money is necessary. Unfortunately, this new economy hasn’t been very friendly to most people. Unemployment is the new normal for many people. Debt is on the rise. Foreclosures are still common. And salaries are, at best, stagnant. Sounds pretty unsustainable to me. Looks like we need to take back control of our future. That’s where starting and running your own micro-business comes in.
In 2008 there were 25.4 million micro-businesses in the United States (The Association of Enterprise Opportunity, 2008). Businesses with no employees accounted for 21.3 million of that number (The Association of Enterprise Opportunity, 2008). There were a total of 28.8 million businesses in 2008 (The Association of Enterprise Opportunity, 2008). That means that micro-businesses made up 88.2% (25.4/28.8) of the total number of businesses in the U.S. during 2008. You definitely won’t be alone if you start a micro-business.
The possibilities for creating your own micro-business are endless. Everyone has marketable skills and knowledge. Everyone. You could take job skills you have and turn them into freelance or consulting work. Many hobbies make great micro-businesses. One way to start getting ideas is to make a list of all the skills, knowledge, hobbies, and interests you have. Discard the stuff that doesn’t sound like fun (because life is too short to not have fun earning a living). Everything that’s left is a potential micro-business.
Advantages of micro-businesses
• Independence. You’re the boss.
• You can spend your time doing what you love (or at least like a lot).
• Your schedule is usually flexible.
• How much you earn is mostly dependent on how hard/smart you work.
• Can usually be started with a minimal monetary investment.
• Limited financial risk.
• Unlimited opportunities to learn new things and have new experiences.
• Can usually work from home.
• Can be part-time or full-time. It depends on how much effort you put into it.
• Minimal paperwork to start.
Disadvantages of micro-businesses
• If the owner (YOU) doesn’t work, they don’t get paid (usually).
• The owner has to provide his or her own health care insurance (or goes without).
• You have to put in a lot of time, usually more than 40 hours a week, to make it profitable. But hey, you like doing this activity anyway, right?
• You’ll need money saved up, a job, or an alternate source of income while your micro-business gets rolling.
• You’re the boss. You make all of the decisions. You’ll also have to constantly motivate yourself.
• There is more to running a business (even a micro-business) than just making widgets. You’ll have to learn a lot about a variety of topics.
• It is harder to get conventional loans. But the Small Business Administration has a MicroLoan program for up to $35,000. There are also a few other micro-loan lenders. Most micro-businesses won’t ever need that much money.
The bottom line is that micro-businesses offer a lower risk/higher reward ratio than most other financial opportunities. True job security is a rare thing these days. The opportunity to take control of your life is a powerful thing. And it’s even better if you can have fun while you’re doing it.
Low risk. Potentially great rewards. What do you have to lose?
The Association of Enterprise Opportunity (2005)– Microenterprise Development in the United States: An Overview – http://aeoworks.org/images/uploads/pages/Fact_sheet_Overview%20of%20US%20micro.pdf
The Association of Enterprise Opportunity (2008) – Microenterprise Business Statistics in the United States – http://aeoworks.org/images/uploads/pages/US-MEBS-2008%281%29.pdf
The Association of Enterprise Opportunity (www.aeoworks.org) – Trade association for micro-businesses. Lots of great information and help.
Small Business Administration (www.sba.gov) – U.S. Federal organization created to help you start and run a small business.
The American Independent Business Alliance (www.amiba.net) – Represents the interests of local small businesses.
Entrepreneurship (www.entrepreneurship.org) – Free online international resource designed to help entrepreneurs.
FIELD – (fieldus.org) – A project designed to identify, develop and disseminate best practices in the micro-enterprise field.
Microbusiness News Briefs (www.microbusinessnewsbriefs.com) – Daily information about operating a micro-business.