What does an entrepreneur do?
A reader from Anchorage, Alaska asks:
“I am thinking of becoming an entrepreneur and starting a small business. But my current job is so uninspiring – I don’t want to get stuck in another boring career. Can you tell me, what does an entrepreneur business owner do all day?”
– Susie M. from Anchorage
Fantastic question, Susie. We get asked this a lot.
The short answer is: small business owners and entrepreneurs do whatever is required to make their businesses a success. This could mean doing everything from emptying the trash cans, to picking up the mail at the post office, to making sales calls, to changing the go-to-market strategy.
It depends on the business and how you as the owner choose to spend your time.
What an entrepreneur does each day also depends on the industry and type of business. There are 30 million small businesses in the United States alone. Naturally, there will be a wide variance in their day to day activities.
What Does an Entrepreneur Do? Main Duties and Responsiblities
That said, every small business owner has six key areas of responsibility:
- staffing and management,
- financial,
- planning and strategy,
- daily operations,
- sales and marketing,
- customer service.
If this sounds really broad, it is.
“As the owner of the business, you’re the captain of the ship. You’re responsible for keeping the entire thing afloat. That’s why you hear about small business owners wearing many hats. You do whatever it takes — no task is too small or too big when it’s your business. And you do it happily,” says our company founder and CEO, Anita Campbell.
To better understand, let’s break this down into specific activities of a small business owner under each of the six areas.
Then later on we’ll share examples of what entrepreneurs do each day in three different businesses.
1. Staffing and Management
Small business owners are responsible for putting a top notch team in place to operate the business. This includes recruiting and hiring new staff. It also means training and developing existing staff.
Small business owners write job descriptions, provide feedback and performance reviews, and reward employees with pay, benefits and recognition.
According to our CEO, as a business grows the pressure is on. The owner’s role has to change. “Most business owners start out doing everything. But you won’t be able to keep that up. If you want your business to grow, you’ll soon become a bottleneck if you insist on doing it all. That’s why smart entrepreneurs hire and develop managers as soon as they can afford it. Delegation is smart,” Anita Campbell says.
2. Financial
Small business owners are responsible for the fiscal health of their companies. It’s up to the owner to establish a viable business model for how the company will earn money. The owner is responsible for establishing budgets and sales forecasts — and making sure the company meets them. The owner may actually invoice customers, collect overdue accounts, keep the accounting system up to date and reconcile bank statements.
Above all, the owner makes sure all expenses kept in line and can be met.
As our CEO Anita says, “One of a small business owner’s key roles is to ‘make payroll’ each month. In fact, I should put “Chief Payment Officer” on my business cards. It’s how I think of my main role. You have to make sure the money is there to pay everyone timely — workers, vendors, service providers, tax authorities, creditors and yourself.”
If the coffers get low, the owner may have to arrange for a line of credit or loan to bridge temporary cash flow issues.
Here are some of the main financial duties:
- Fiscal Oversight: The small business owner continuously monitors the financial health of the company, ensuring all financial activities align with business goals.
- Business Model Development: Crafting a sustainable and profitable business model is at the core of the owner’s responsibilities.
- Budgeting: Establishing and adhering to a budget helps in maintaining the company’s financial stability.
- Sales Forecasts: By predicting future sales, the owner can make informed decisions about inventory, staffing, and other resources.
- Invoicing & Collections: Directly managing the billing process, the owner ensures customers are invoiced and that overdue accounts are collected.
- Accounting Management: Keeping accounting systems updated and reconciling bank statements ensures financial transparency and accuracy.
- Expense Management: It’s crucial for the owner to monitor and control expenses to maintain profitability.
- Payroll: As the “Chief Payment Officer,” the owner guarantees that every stakeholder, from employees to vendors, gets paid on time.
- Credit & Loans: If there’s a cash flow crunch, the owner might secure external financing to keep operations running smoothly.
3. Planning and Strategy
Small business owners are responsible for setting strategy and having a business plan. They establish the vision and mission for their businesses. “Every entrepreneur should ask and answer the question ‘what do we want to be known for?’ If you can’t do that, your business will be rudderless and could lack distinction,” says our CEO Anita.
The owner also communicates the vision and mission so that employees, customers and the world understand.
As part of planning and strategy, entrepreneurs keep tabs on marketplace trends, competitors and changing customer tastes and needs. After all, any good entrepreneur knows that you must deliver what the market wants and is willing to pay for.
This is always changing — it doesn’t stay static. From time to time, you have to update your products and services, adjust pricing or adapt your marketing strategy to meet expectations.
4. Daily Operations
Small business owners are responsible for carrying out daily operations. For example, the owner of an organic food business may have a big role in growing and harvesting the food.
But it’s important to look up from doing to see the bigger picture. That’s why smart entrepreneurs work on the efficiency and effectiveness of daily operations.
Every company has inefficiencies and waste. Every company has processes that could be tighter. Part of the owner’s role is to identify where that occurs and find solutions. This includes automating tedious manual procedures, or adopting new technology to drive cost out of your bottom line. It may mean outsourcing non-core functions.
“Small business owners should network with peers. And don’t forget to attend industry events a few times a year. This is how you discover best-in-class technologies and new operational methods. Continuous learning is key to running a business,” adds Campbell.
5. Sales and Marketing
Small business owners are responsible for sales revenue and the marketing to drive sales.
Many owners, especially in the early years, also go on sales calls and help close sales. Owners may get involved in marketing, including establishing campaigns, placing ads, doing email marketing and social media marketing.
Here are some of the main things:
- Sales Leadership: The owner often spearheads sales initiatives, setting targets and strategies for the team to achieve.
- Direct Sales Activities: Especially during the startup phase, the owner might be directly involved in sales outreach, from cold calling to face-to-face meetings.
- Campaign Development: The business owner might conceptualize and launch marketing campaigns to boost brand awareness and drive sales.
- Ad Placements: Ensuring that advertisements are placed in strategic locations, both online and offline, to maximize reach.
- Email Marketing: Crafting compelling email campaigns to engage existing customers and attract potential ones.
- Social Media Engagement: Utilizing platforms like Facebook, Twitter, and Instagram to connect with the audience and promote products or services.
- Monitoring & Analysis: Tracking the performance of sales and marketing efforts to identify areas of improvement and capitalize on successful strategies.
6. Customer Service
Small business owners are responsible for the overall customer service experience. It starts with making sure your company delivers a quality product. But the whole experience should delight customers.
“In the early years, it’s common for the owner to be the person answering the phone or manning live chat to solve customer issues. Later as the business grows, smart entrepreneurs put in place a customer service organization and empower them to solve problems,” says Campbell.
A big part of customer support these days is great technology that’s integrated to avoid data silos and customers feeling like you don’t know them. A CRM system, help desk software, live chat, sophisticated phone system and autoresponder emails are just some of the solutions that can help make customers feel valued.
Ultimately, the owner must build a positive company reputation as reflected in renewal rates, repeat purchases, net promoter scores, and online reviews and testimonials.
Duties and Responsibilities of a Small Business Owner Summary
| Key Areas of Responsibility | Brief Description |
|---|---|
| 1. Staffing and Management | Business owners recruit, hire, and train staff, focusing on team development, and often evolve roles to delegate as the business grows. |
| 2. Financial | Owners ensure the company's fiscal health, from establishing a viable business model to managing expenses and handling financial challenges. |
| 3. Planning and Strategy | Owners set the business direction, keeping abreast of market trends and adapting strategies and offerings to meet evolving market needs. |
| 4. Daily Operations | Owners are involved in daily tasks and operational efficiencies, often leveraging technology and outsourcing to optimize the business process. |
| 5. Sales and Marketing | Business owners drive sales revenue and are integral in the early stages of sales and marketing, evolving strategies to meet market demands. |
| 6. Customer Service | Owners ensure top-notch customer experiences, initially handling inquiries directly, and later integrating tech solutions to enhance customer service as the business grows. |
What Does An Entrepreneur Do? Some Examples
Let’s look at a day in the life of three different entrepreneurs, to see how their roles are similar, yet vary.
The Owner of a Restaurant
A restaurant owner may go to the market to purchase the food needed for dishes. He or she may do some of the food prep — because sometimes the owner is also the head chef. The owner may greet customers at the door and seat them.
He or she may interview candidates for open positions, or write up job postings. The owner may train staff or ring up customers at the cash register.
Later in the day, the owner may be talking with someone from a sign company about a new building sign, or a landscaping service about planting flowers in front. And the owner keeps the accounting records and reconciles the bank account.
The Owner of a Web Publishing Business
Someone who owns a Web publishing business (such as an ad-supported site), may write articles or otherwise create content for the site. He or she stays up on trends by visiting other sites and social media, to see what’s popular and what other publishers are doing.
The owner may post on social media accounts. He or she manages any ad networks or ad sources, to make sure everything is working properly, troubleshoot issues and try new things to improve. The owner interacts with writers and other staff, providing feedback on content topics or input on new site features or improvements.
A Web publishing entrepreneur also analyzes pages for traffic referrals and for ideas to optimize the site. Along the way, he or she handles the finances and makes sure everyone gets paid.
The Owner of a Plumbing Business
A plumber with his or her own business may go on plumbing calls to customers’ homes or businesses. At a customer’s site, the plumber may take a photo of a broken part needing replaced and send it to an employee back at the office to look it up and order it.
The plumber may have to drive to the parts supplier to pick up a part if it is needed immediately. And he or she stops for gas and for a quick sandwich for lunch.
When a job is done, the plumber writes it up on an invoice, either a paper form or an electronic version on his or her phone or tablet. Then proceeds to call his next stop to tell them “I’m on my way” and looks up directions to get there.
A plumbing entrepreneur with plans to grow bigger may hire other plumbers to work in the business. Some amount of time may be spent training them or communicating with them. The plumber may also communicate throughout the day with someon3e back in the office who manages online reviews, does marketing, schedules service calls, or handles other back office functions.
Working on the Business As Well As In It
As you can see, what a small business owner does each day entails working on the business, as well as in the business.
One last piece of advice comes from Anita our CEO, “All entrepreneurs have the power to pick and choose what they want to do each day, whether they realize it or not. If you hate paperwork but love visiting customers, there’s no reason you can’t arrange your business to give you maximum face time with customers while someone else handles the back office. It may take some planning and a bit of time to arrange your business that way. Just keep on working toward your vision of the ideal workday for you. Life is too short to do anything except what you love.”
All answers to reader questions come from the Small Business Trends Editorial Board, with more than 50 years of combined business experience. If you would like to submit a question, please submit it here.
Image: Depositphotos.com
This article, "What Does an Entrepreneur Do? The Roles and Responsibilities of Small Business Owners" was first published on Small Business Trends