Beginning a small-scale business is a challenging task. Some are successful, while others close their doors. For instance, for every 100 companies starting in March 2023, 18 were shut down a year later, per the U.S. Bureau of Labor Statistics.
Many factors determine how your business can be profitable or fail. Certain, such as the economy, are outside of your control. Others, like your personal traits, are a significant factor in your company’s success.
What is a ‘Successful’ Small Business?
There’s no definition of what qualifies an enterprise as “successful.” Small entrepreneurs may see this in different manners. According to a study on how external stakeholders like bank customers and customers measure the success of a small-sized business, It boils down to the following main elements:
- How profitable is your company
- No matter if your company is growing
- How satisfied are your customers and employees are
- If your company has an excellent reputation in the local community
The person who runs the company has a huge influence on these aspects, and owners of small businesses tend to have many of the same characteristics.
Psychological traits of successful business Owners
“Over the years, I’ve had the honor to work with a variety of small-scale businesses,” Clate Mask, the CEO of Keap, the software for sales and marketing business geared towards entrepreneurs, explained to The Balance in an email interview. “Many extremely smart and talented individuals have launched businesses but have failed.”
Certain personality traits are likely to increase your chances of success as a small business owner. They’re important since they establish the foundation for the other characteristics and abilities you’ll require to succeed.
Optimism
“Something entrepreneurs and small-business owners don’t speak about enough is the stress and loneliness that comes with every stage of business,” Mask said. There are plenty of other obstacles you’ll encounter, also. Nobody can anticipate the outcome of a war, pandemic and civil unrest, or any other variables that are out of our hands. As time passes, you’ll also encounter new twists and turns.
The factor that keeps moving forward movement in these scenarios is optimism, a feeling of optimism and confidence that the future will be a good one. Many people feel pessimistic to various degrees; however, having a positive outlook can give you the confidence to face issues in your business moving forward.
Adaptability
Another important aspect of facing ever-changing challenges is your ability to adapt. Are you a fan of papers and fax machines even though the world has changed using digital forms? What is the easiest way to ditch your traditional business practices to follow what’s changing? People who possess this ability are likely to be successful, particularly over the long term.
Resilience in the face of emotional trauma
Being generally optimistic and able to take on the unexpected is important, but staying committed to your course in the face of emotional wrath is a top ability for many people. For instance, if you cannot attend an event for your family because you need to go to your store to pick up a huge delivery of goods, you feel you’re failing people or being a liar. With that product, your business will be able to earn a profit.
“At some point, you’ll disappoint everyone, whether friends or family members, employees, as well as you,” Mask said. “It requires grit to overcome these challenges to achieve the point of.”
Work-Related Control Locus of Control
This idea, coined by psychologist Julian Rotter in 1954, refers to whether you believe you have control over your environment–specifically, your work environment. If you think you’ve got some control over your future, you’re more likely to succeed in your business. However, if you believe your company’s success chances are more dependent on the dictates of the market rather than on your own, If you think you cannot control your destiny, then you won’t be as successful.
Strong Work Ethics
You could have all the above traits; however, If you’re not a person with an unwavering work ethic, you’ll not even be able to run a successful lemonade stand in the street. Many small entrepreneurs want their business or website to expand and earn money which requires dedication to their work. This includes early mornings, office lunches or late nights, or even giving up activities.
The Functional Characteristics of Successful Business Owners
How you handle day-to-day business operations is another crucial element that can make your company sink or rise.
Creativity
Apart from machine learning, what separates humans from machines is that they can develop innovative solutions to issues. That’s right. We’re innovative. Being particularly creative is a sign of the ability to adapt because you can create and implement plans that are never seen to guide your business through challenges to achieve your desired success.
Self-Discipline
Many people say that they can do the difficult things required for running a business; however, when it comes down to it, a lot of them do not. Most successful entrepreneurs can establish rules for themselves and stick to the authorities.
A lesser-known aspect is an ability to stop whenever it’s needed. “As entrepreneurs, we’d like to work all day long on our company,” Mask said. “But having the ability to set limits and establish an equilibrium will pay off in the short and long-term.”
Note
Working hard is paramount, however, not at the cost of avoiding your child’s appointments with the doctor.
Goal-Oriented Mindset
Setting SMART objectives was among the essential qualities of successful small business owners, according to an article from 2003 by The University of Tennessee. Setting up an aim for where you want to move your business keeps it from wandering around in circles and is an under-appreciated ability. Successful small business owners can set short-term, medium-term, and long-term goals in all aspects of their businesses.
Social Personal characteristics of successful business owners
“Extroversion” is a frequently-repeated characteristic hallmark of successful business leaders. However, you can have a personality that is social to succeed. Introverted entrepreneurs can do well also, so they recognize and work on the areas that allow them to be successful in what they do.
Networking
There’s a saying that it’s not about what you know but rather the people you know. Your customers are the basis of your company’s success, but to attract the right customers, you must find ways to draw them in, and a solid network can help to open the doors.
Building connections via informal and formal online and in-person networks can help you achieve your goals.
Note
Networking is consistently recognized among the most crucial characteristics of successful small-business owners in almost every study and poll The Balance researched and reviewed.
Negotiation
Certain businesses depend on standard pricing and services, while others rely more on flexible pricing. For example, you’ll require negotiation skills greater than bakers if you’re a pawnbroker. But negotiating is an essential skill that every small business owner has to be able to use occasionally. If you’re proficient at it, you’ll be able to give your business an edge.
Leadership
If you’re not running on your own, it is necessary to lead the work of a team. Being a great leader requires time and experience. It involves things like finding out the strengths of your team members and weaknesses, how to inspire them, and also what to do if they don’t perform.
Additionally, as entrepreneurs, you’ll need to become adept in developing various leadership styles as time passes. If you’re still managing your 500-person staff in the same way you did when you had just five employees, as an example, likely, your company will only be around for a short time.
