Micro Business Myths: How to Be a Roaring Success When You’re the Only One in Charge
Do you work for yourself – or are you planning to in the future?
If so, you’re in good company. A new year always sees an upsurge in start-up businesses. In fact, January is the most popular month of the year for people to register new start-ups. HMRC registered more than 660,000 new businesses in 2018 alone.
If you’re on your own, or you employ fewer than nine people, then you are officially classed as a ‘Micro Business’.
The Unstoppable Rise of the Micro Business
Micro businesses are growing rapidly in the UK, with 1.11 million in 2017 accounting for an enormous £552 billion in sales. According to the government, the vast majority of 2019 start-ups in the UK will be micro businesses.
This means that micro businesses are far from aptly named – because they are certainly not ‘micro’ in terms of scope and success!
It is easy to spot the reasons behind the rise of the micro business in recent years. Tired of bland corporations and faceless businesses, as consumers we are increasingly looking for authenticity, connection and personalisation.
On the High Street, ‘big name’ retailers are giving way to independent shops and artisan food stores. It’s even possible that you could know the name of the person who kneaded the dough in that freshly-baked loaf you bought the other day.
You may have heard the famous quote by Napoleon, that Britain is “a nation of shopkeepers”. While he meant it as an insult, I think of it as a great compliment. The UK has always been a fantastic place for doing business, and we have a history of celebrating the small and proud!
That said, there is a lot of confusion surrounding micro businesses, along with some common myths that understate their marvellous contribution to our economy.
So let’s begin by busting some of these myths, and celebrating the importance of the micro business.
Myth 1: A Micro Business is the Same as a Small Business
Micro businesses are often lumped into the same category as a small business or SMME (Small, Medium and Micro Enterprises) If you work for yourself, you might feel as though a great deal of ‘small business advice’ just doesn’t apply to you.
This is because in a great deal of cases, it won’t!
A small business employs up to 50 people, while a medium enterprise has up to 250 staff. As the vast majority of micro businesses – 80%, in fact – are made up of two people or fewer (one!), this means advice about planning and growth will vary greatly.
For example, common micro business issues tend to centre around knowledge and confidence, such as not charging enough, not outsourcing vital business skills, or not understanding the customer base.
Additionally, we have all been reading about the potential threats to our businesses wrought by an impending Brexit – yet in reality, micro businesses are far less likely to be affected.
So as a micro business, be careful of taking ‘one size fits all’ advice, tailored to small businesses. You will benefit from seeking guidance provided by an advisor who understands your unique challenges.
Myth 2: Micro Business = Lifestyle Business
As a passionate advocate of micro businesses (and as a micro business owner myself!), one of my biggest pet hates is people referring to them as a “lifestyle business”.
This implies that running a micro business is more of a hobby than a legitimate profit-making business, which couldn’t be further from the truth.
Micro businesses make up a staggering 75% of all businesses in the UK, with 4.3 million non-employing businesses run by exceptionally hard-working people.
As we’ve already established, micro businesses contribute billions of pounds to our economy, whether you decide to work from a fancy office – or at home in your pyjamas!
Myth 3: Micro Businesses Don’t Need to Plan
A recent report from the Enterprise Research Centre shows that more than half of all micro businesses are home-based, with over 70% of them family owned.
In addition, results from a survey of micro businesses showed that 74% aim to “keep their business similar to how it operates now”.
While you might be forgiven for thinking that a home-based business that isn’t looking for rapid growth doesn’t need to plan for success, you would be wrong.
The process of micro business planning doesn’t have to be complicated (in fact, it shouldn’t be!), but it should demonstrate the same level of commitment as any other business.
For starters, your business plan should include an understanding of your mission, your values and your brand.
You should also ensure that you regularly analyse any potential risks to your business, and take time to check-in with what your competitors are doing. This will help you better understand the market, and how you can position your business for greater success.
I would love to hear your questions or comments about micro businesses, so please feel free to pop them in the box below.