As a business owner, you know that life is full of contradictions. A bank will lend your company obscene amounts of money…exactly when you don’t need it. But what happens when your business desperately needs financing? It’s the hardest thing in the world to get. Suppliers tell us they “value our business” and in the same breath tell us they don’t deliver after 5:00 p.m. on Friday when you ask them if they’ll be there at 5:15 p.m. Another example of a contradiction: You reading this article. Let me explain why.
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So why do we call ourselves “small” businesses?
Small is a relative term
The obvious answer is that “we call ourselves small because we are small compared to bigger companies.” Yes, it’s true; Wal-Mart does move more product than I do. But why am I comparing myself to Wal-Mart? Who says that’s a valid comparison? When did I agree to that benchmark? By calling ourselves “small” we paint ourselves into the “small corner” and over time we start “thinking small.”
The effect of “thinking small” has disastrous consequences for business owners
The effect of thinking small doesn’t lead to a cataclysmic failure of gargantuan proportions. Lightening won’t strike you. The “business police” won’t serve you with a warrant. Instead, it’s much worse. It’s death by a thousand cuts. It’s a process that can take many years. Your company’s fate is sealed the moment you start thinking small, but sadly you won’t realize it until you lay off your last employee four years later and ask yourself, “How in the world did it get to this?” It’s the end result of a series of many poor decisions. When you start thinking small:
You start thinking defensively instead of offensively
It’s true that free market economics is not zero-sum game. But it’s hardly static either. A business owner that thinks small will focus on protecting their existing customers. They are playing to stay in the game; not to win. This sends the wrong message. If you don’t go after new clients, your competition will. Your existing customers will begin to wonder why you aren’t growing and why their peers are buying from other companies. They’ll start to think that something may be wrong. They will leave you. By thinking small and playing defensively, you are guaranteed to lose.
You miss opportunities that are just outside of your comfort zone
Making decisions that are outside of your comfort zone becomes nearly impossible when you “think small.” I spent several years working in Latin America. In the region the term for small businesses is “PyMEs,” which is the Spanish acronym for small and medium-sized businesses. What I learned through my experience there is that being the owner of a PyMEs is an identity. You start a small business and it stays a small business for the rest of your life. Your children – if the business survives – inherit your small business and keep running it at the same small scale. Even social circles and political movements are built around this identity. The owners of these companies can’t see outside their comfort zones. They have nowhere to go or grow. In some countries, you may be able to play this game for a long time, but in an economy as dynamic as ours, the odds are stacked against you.
Go to the article: When You Start Thinking Small, It’s Over
