The characteristics of small business owners&8223, and the nature of Essay

The characteristics of small business owners‟, and the nature of small business in general - Essay Example Small businesses are usually sole proprietorship companies that are run by individuals or families. The success of small businesses largely depends on their owners and the resources available to them (English, 2006). There are many desirable characteristics of small business owners, namely (a) opportunity seekers, (b) risk-takers, (c) persistent, (d) committed to work, (e) goal setters, (f) information seekers, (g) knows how to demand for quality and efficiency, (h) good in planning and monitoring, (i) persuasive and knows how to communicate ideas, and (j) confident ((English, 2006; English and Moate, 2009; Deakins, and Freel, 2009). To get a clearer picture of how small businesses work and what important characteristics small business owners should have, let us discuss these things one by one. II. Characteristics of Small Businesses in General One of the main advantages of small businesses is flexibility and the ability to move quickly (Deakins, and Freel, 2009). Note that in small businesses, the owners are usually at the helm of the operations and can decide immediately on issues concerning the business. Also, in small businesses, there are very few management levels which make decision-making processes less complicated (Deakins, and Freel, 2009). Since small businesses are flexible, it can easily jump into certain opportunities. ... This kind of open and fluid communication is usually absent in bigger companies so it takes longer time for bigger companies to decide on certain production issues and meet the demands of the market. Small businesses have many disadvantages but they also have disadvantages. One of the biggest disadvantages of small businesses is limited capital. Most small businesses are financed directly from the pocket of their owners so they do not usually have that much start-up capital (Gerber, 2001). Generating capital through bank loans may also prove to be quite a challenge for small businesses since they establishments do not have enough assets to serve as guarantee for loans (Gerber, 2001). In most cases, small business owners have to mortgage their personal properties to finance their businesses. Since small businesses have limited capital, these establishments may find it difficult to development their products properly and reach their target market efficiently (Gerber, 2001). Operating o n shoe-string budget often takes its toll on small businesses and many of these establishments go bankrupt during the first six months of operation. III. Characteristics of Small Business Owners Running a small business is challenging and it takes a special breed of entrepreneurs to set-up and run this kind of establishment. According to Zahra et al. (2009), running a small business is like running a guerilla army with limited resources in a flexible environment that allows the entrepreneur to innovate and be creative. As earlier mentioned in this essay, there are many desirable characteristics of small business owners. In order to survive in a very competitive market, small business owners must know how to spot opportunities and act