Are you a "small business" owner?

[caserri]

Here is a question I have often thought about.

With all the talk going on now about "small business" and the help that is available to them, I was wondering what you guys and gals thought a small business actually is, in terms of revenue.

Obviously most, if not all of us here would consider ourselves to be small business owners, but are we really? Or are we just collecting money as a hobby. At the peak of vending career, my total yearly revenue was a fraction  of the revenue generated by other "small businesses" in my area.

I once placed a machine at a local pizza restaurant. The owner and I immediately hit it off. Speaking to him was really easy. He seemed very honest and forthcoming as we spoke about everything from politics to the economy as it relates to small business owners. I left that location feeling like I was not even in the same league as him although we were both considered "small business" owners.

I'm not sure who else feels like this or what amount of revenue is needed to justify the label but it really bothered me. I feel like I busted my golpher just as hard as any other business owner but I wasn't viewed as I wished to be. Not by local business peers, not by my friends and family, (except Mrs C of course) and certainly not by the bank or any other agency that is in existence to help, work with, or at least acknowledge a small business.

Thoughts?

[alyssamma]

I don't think you need a certain minimum to be a small bus owner...I would say you need to be *under* a certain maximum. What that limit is I'm not sure, tho But anything less than 50 emps and doing under $1M in sales/yr would be one.

So I would consider that kid w/the lemonade stand making $10/mo to be a small bus owner

Kevin

[caserri]

Thanks for the reply Kev.

Thats kind of my point though. If I'm considered a small biz because I have less than 50 employees and make less than 1M annually then why am I (my Business) not treated like the guy who has 49 employees and makes $999,999.00 a year?

Is there such a thing as a "Micro Business" because I feel thats where I am in terms of public perception.

[Mercury]

In the "business world" (eyeroll, because SO many "big business people" are friggin IDIOTS!), any business grossing less than $100 million is considered "Small". I think the cutoff for "micro businesses" is $10 million per year.

Merc

[sherlock]

Thanks for the reply Kev.

Thats kind of my point though. If I'm considered a small biz because I have less than 50 employees and make less than 1M annually then why am I (my Business) not treated like the guy who has 49 employees and makes $999,999.00 a year?

Is there such a thing as a "Micro Business" because I feel thats where I am in terms of public perception.

Steve,

Could you be more specific in how you (we) are not treated like the guy who has 40 employees and makes $999,999 a year?

[alyssamma]

Steve, yeah, I echo Sherlock's post.

How are you treated differently?

[caserri]

Thanks Merc.

That just furthers my point that what I am doing as a business has no classification. If it's not even a "micro business" then what is it and how can any of us hope to receive the respect, and more importantly the cooperation of those we wish to (or NEED to) engage in business activities with?

It's one thing to not be taken seriously by your family and friends, or even a location owner, but what about accountants, insurers, bankers, investors, law enforcement, attorneys, etc...

I remember when I opened my business checking account. The banker just smirked and literally said, "Oh how cute! You have gumball machines? So you'll be interested in our low balance account."

Or when I applied for my business license. The town clerk had no idea how to classify my business and didn't really seem interested in helping me find out what licenses I actually needed.

Or when I was told by an insurance agent that insurance was not really needed due to the relative size and sales volume of my "business".

All these things may seem like bonuses. After all, the low balance account was free! The business license only cost what the minimum general business license cost and the insurance cost wound up being predicated on my annual sales volume, which was relatively low  but even still, I didn't appreciate being made to feel like I was less of a business person.

Maybe I'm just ranting but sometimes it's good to let off a little.

[alyssamma]

Steve, that's interesting. I've never experienced anything like that. Furthermore, I've helped several people start their own businesses and they've never had that type of reaction either. Well, except for the clerk. What you are describing there is the typical gov. emp. attitude - not helpful

Perhaps this is a regional thing. Up in MA, people are meaner (j/k).

Kevin

[caserri]

You could be right. I would go a step further and say that it may not be a regional thing but more of a very localized thing. Like all in my head! 

I don't know. I have been known to be a bit over sensitive to the way I'm treated at times.

[sherlock]

It's one thing to not be taken seriously by your family and friends, or even a location owner, but what about accountants, insurers, bankers, investors, law enforcement, attorneys, etc...

I have a couple of opinions about this Steve.

First of all, we get into vending for things other than fame, fortune, and the admiration of our fellow man. There's nothing glamorous about the vending business and we actually benefit from that. Think of the saturation we already experience in this industry. How bad would it be if vending made us rich, popular, respected, and famous? There would be no room in any establishment for our machines due to all of the shallow people getting into the vending business with all of the wrong intentions.

Secondly, remember that most of those accountants, insurers, bankers, investors, law enforcement personnel, attorneys, etc are NOT entrepreneurs. They have jobs.

With all due respect to all of the professions listed, these people are not wired the way most vendors are. I assure you that even those of us vending on a part-time basis have more entrepreneurial spirit than all of those people who have disrespected you combined. Without the entrepreneurial spirit they can not understand...and people often mock what they don't understand.

Those people you described are the same people who are stuck in a corporate hell, chained to a desk or cubicle, have dead-end jobs, and/or work for lousy bosses and do NOTHING about it. Why would any of us want their approval for our choices?

Admiration and respect are like like insults -- they only matter when coming from someone that matters...and those "professionals" in your post, none of them matter.

[bostonvendor27]

I  can relate to Steve. I have been going through some of the same issues!!!  In my opinion we do our part to stimulate industries (candy and manufacturing)  that  employ thousands and thousands of people and we offer a great service to other small businesses that make them more attractive to there customers........We are just as much of a small business then any other!

[caserri]

Sherlock.

You are absolutely right. Opinions from those people really don't matter at all. Please don't get me wrong, I'm not looking for fame and fortune from vending either. I've given up on that after 10 years!  I have just really taken note of the lack of respect as a business owner I get from most everyone I come into contact with on a professional level.

I was out having lunch with a friend of mine that I know from an unrelated industry. I am paraphrasing a bit here but he asked me when I was going to give up on working so hard for quarters. Now, I love hearing that line for all the reasons you stated in your post about not having everyone want to be a vendor. Inside though, it's comments like that which make me realize that my business is not perceived as a real business, no matter how I portray myself. In fact, the more I try to portray a professional image, the more I am ridiculed for thinking that I run a real business.

Another example...

I once reported a stolen machine to the police. I was told there was nothing they could do about it unless I saw the thief commit the crime and I could identify him. Granted, a gumball machine is not the most important piece of equipment but how do you think the response would have been had the thieves actually broke into the location and took something belonging the that location owner? At the very least they would have sent a car and filed a report. Am I not afforded that same procedure simply because I owned a gumball machine?

Look, I could really care less about perception. My problem is what happens to me as a business owner when that perception stands in the way of something I may need. Is there not anyone here who failed to be approved for something or failed to acquire something, or worse yet, lost something due to the perception that you are not a real business owner?

[alyssamma]

Steve, part of the reason for the response you get is that vending, unlike many other businesses, costs nothing to get into. A 10yr old kid can do it if he wants to.

That doesn't mean it is any less of a business. It is just that people don't understand there are vendors out there with 500 machines.

A business is how you run it

Kevin

[sherlock]

Look, I could really care less about perception. My problem is what happens to me as a business owner when that perception stands in the way of something I may need. Is there not anyone here who failed to be approved for something or failed to acquire something, or worse yet, lost something due to the perception that you are not a real business owner?

I don't even WISH the public would change its perception of vendors or the vending industry.

I like flying under the radar.

But, I have not experienced any of those things you posted, Steve.

If/when I do, I hope I'm able to simply move on.

Closed minded people are not people with whom I wish to do business.

That's one of the beauties of having your own business...you have a little more power over who you work with...unlike a job. Those people not willing to work with me or my business have that right.

Just as I have the right to not let their perception of me or my business effect me much.

I'll just move on to the next opportunity...no one has a monopoly on anything our business needs.

[agrantha]

Dude

If you are worried about public perception then you are doomed regardless of what you do.  I would like to talk on but from your words you have other issues.

[alyssamma]

Agrantha, I think you misunderstood the post. Steve wasn't talking about the general public, he was talking about people he had to deal with. Let me give you a specific example with me. My main job is as a consultant. Back in 2000 I tried to get into GE. I had a small company with 12 employees. GE basically said "no way" and wouldn't even talk to me.

One month later I was working at GE along with 3 of our employees. How? I had to subcontract through another (larger) company. It was a bad deal for GE as they were paying $25/hr more for me and $15/hr more for each of my emps.

This is an example of someone preventing you from doing something because of your size.

Luckily, in this instance it worked out for me. But there have been others where it didn't

Kevin

[agrantha]

I did not mean to be rude with my post.  But you must understand that if you are doing nothing you will not be ridiculed.  If you are doing something you will be ridiculed regardless of what you are working to accomplish.  You are being ridiculed, so smile.    You are doing something.

[jwhite]

I have shared my new venture with about 10 people thus far (friends and family)  I typically get a little laugh as the response. Then they ask a few questions and quickly realize that a little "side" money can be made from collecting quarters.  Then they start brainstorming locations for me....."oh I know Joe who owns a tire shop, I will ask him about putting a machine in there....." etc...

I often joke to people about being on the "slow" track to the rich and famous with the 50 machines I recently purchased.  I am taking my approach to this venture very serious, but also light hearted at the sametime.

[caserri]

Dude

If you are worried about public perception then you are doomed regardless of what you do.  I would like to talk on but from your words you have other issues.

You're right. I have several issues. Sorry to bring this topic up.

[kai1836]

  Steve,

  To hell with what anyone thinks about you or what you decide to do with your time on this spiritual plane. That bank person that looked down his nose at you probably makes 12/hr and just lost half of his retirment in aftermath of our credit crunch/financial meltdown.  Be proud of what you do if it makes you happy.

[BluePlate]

Steve, good post!  A few years back I had put together a local business networking group, it has now disbanded.  We brought in a CPA to discuss this exact topic.  The IRS actually has definitions to determine wether your money making is a hobby or actually a business.  Basically, you can not lose money more then 3 out of 5 years you are in business and take business deductions.

What I think big issue is for vendors (specially bulk vendors) is what they are classify as an expense.  I had an earlier post "Don't lie to yourself!", are us vendors really counting all the expenses?  Mileage, cleaning supplies, stickers, marketing material, software, ect.  This stuff adds up quickly.  For example, you steal a bottle of windex and paper towels out of the kitchen, but you don't "PAY FOR IT OUT OF THE BUSINESS ACCOUNT".

As far a perception, I have run into that a few times myself.  I don't think people understand how quick quarters add up. 

I think a good example of business perceptions is Multi-Level Marketing (MLM).  If you ever joined one, they every one of them talk about "DREAM KILLERS".  These are the negetive Nelly's in life, they think wealth of any kind is out of reach, they have been programed to be to work on time, golpher about the boss and do the least amount of work for them most amount of pay.

I like to think of this like this ..... I have a Bouncy Ball location truly netting me $26 after all costs (even if I drive there and back without stopping anywhere else).  It just so happens it costs $25 a month to have my trash picked up in front of my house.  My nieghbor has to put his trash in the car and drive it to the dump. 

The person at the bank that said you were cute?  Well most people that work at a bank do not get paid well at all.  But it is a job that usually comes with some "status".  They never have to ask if you want fries with that and they have the power to ask for IDs (even if they know you).  Not to mention they always can know your balance.  Many of these bank people never got there hands dirty and certainly does not understand the value of a quarter.........

That was my 25 cents worth.......

[antoniocinisi]

You can deduct expenses and  forever lose money every year as long as you are putting forth a good attempt to build your legitimate business. This comment came from an IRS auditor that audited a friend of mine that has multiple businesses.

my bookkeeper said something similar,he said for a long time and not forever I think.

Steve,who cares if some people think vending doesnt make much money or they look down on it,like others said it is best to be flying under the radar anyways.more people understanding the true potential of this biz, the more competitors would pop up left and right.

[The Mage]

Anytime anybody thinks what I am doing is weird, or not right, then I know I am on the right track.

I have seen normal, and normal scares me.

If anybody looks down on you because of your profession, or business, it says more about them then it does about you.

I remember reading about a person who would decide who he would do business with only after taking them out to eat.  Then he would pay attention to how the person treated the waiter or waitress. 

[sherlock]

Anytime anybody thinks what I am doing is weird, or not right, then I know I am on the right track.

I have seen normal, and normal scares me.

If anybody looks down on you because of your profession, or business, it says more about them then it does about you.

I remember reading about a person who would decide who he would do business with only after taking them out to eat.  Then he would pay attention to how the person treated the waiter or waitress. 

Great post.

In your last paragraph, it sounds close to something I read in a book by Louis Barajas.

I'm paraphrasing, but his process on deciding whether or not he's willing to work with someone is, "Would I like to have dinner with this person?"

If the answer is "No", he doesn't work with him/her regardless of the potential of the relationship.

If the answer is "Yes", he not only works with them but will often have a meal or two with the person during the relationship if possible -- to make sure his gut feelings were correct.