Being your own boss is not just a pipe dream and in the economic downturn, it may be a wise choice.
According to Statistics Canada, 71,000 jobs were lost in January in Ontario alone, affecting those in the 25-to-54 age range the most.
Business observer Katherine Roos says that in tough times, self-employment increases.
Roos is the small business manager at Enterprise Toronto, an initiative managed by the City of Toronto Economic Development Office. Enterprise Toronto provides free consultation and resources to help entrepreneurs and small businesses during their first years.
“(People start businesses) either because it’s easy or out of economic necessity,” she said. “They’re going to do it and find a way to do it.”
For Karen Wielonda, 28, launching her own business felt appropriate and came naturally.
When Wielonda’s friends asked her to bake cupcakes for the opening of their new bar, she considered doing more – making cakes for money instead of making them for free.
“I thought I should have a name,” Wielonda said. “My girlfriend found the name for me and I thought it was perfect.”
Frostitution, her custom cake business, was born. That was two-and-a-half years ago.
Although Wielonda got her diploma in culinary arts from Toronto’s George Brown College, her heart has always been in baking. Over the years she’s worked in different bakeries. But having people tell her what to do, Wielonda said made the monotonous tasks “mind-numbing.”
“Basically, I’ve had my fill of all those jobs. I’m totally done. I could never work for anyone like that again,” she said.
Roos added that having control over one’s own destiny, often makes the self-employed happier.
Dave Sims, 28, co-owner of T-shirt design company The Bluebird of Happiness, says watching a family member become an entrepreneur in the bar business is what inspired him.
“I was out of school for a couple of years and I just liked the idea of being your own boss,” Sims said. “That kind of entrepreneurial lifestyle appealed to me.”
In October of 2006, Sims was working in a bar and noticed two of his co-workers were wearing T-shirts they had designed. Patrons began asking where they could buy one. Around the same time, Sims acquired some inheritance money and knew what he wanted to do with it.
“I decided that they had a really good product, but not enough initiative to get it out there,” Sims says.
He approached them and suggested they go into business together. Shortly after, they had registered the name, business number and vendor’s permit. This was all part of Sims’ business plan.
And having a plan is important.
Roos pointed out that promoting a new business can pose the greatest challenge for novice entrepreneurs.
Wielonda chose to start her cake business off slowly. Besides having some business cards and Facebook and MySpace accounts, most of Wielonda’s business comes via word-of-mouth.
“I don’t advertise and I battle a lot over this in my head because where I’m at now – I make zero to fives cakes in a week and it’s a decent pace for me,” she said. “I have two part-time jobs so the amount of cake orders I have is totally good.”
And for Wielonda, Frostitution is a one-woman show.
Statistics Canada reports there were about 2.2 million businesses in Canada, as of December 2001. Roos estimates that sole-proprietorships – businesses owned and operated by one person – make up more than half of these.
Everything for Wielonda’s one-of-a-kind cake creations is done in her home kitchen.
The T-shirt stock that isn’t being sold at retail shops through consignment, Sims stores in a dresser drawer in his bedroom.
And these practices are not uncommon.
According to a November 2004 City of Toronto report, almost a third of self-employed city residents chose to operate their own businesses from home. Roos says that keeps costs down.
What about the money?
In the last two-and-a-half years, The Bluebird of Happiness has put out three T-shirt designs, each selling for $20. Sims says he’s just breaking even. But he has hopes the new web-site, where people can buy his products on-line, will make a difference.
Wielonda’s Frostitution cakes start at $60. She says the labour involved means it’s not worth it to do it for less. But on average, a customer can expect to pay $100 or more for a cake that feeds 15-to-20 people.
As Roos points out, business success is not always judged by how much money is made.
“It’s about whether or not they’ve reached their goal,” she said.
She also says that money is not the biggest barrier when starting a business.
“In a down economy, people create their own opportunities,” she said.
Enterprise Toronto loves helping youth because, as Roos says, some of the largest companies in the world began with young entrepreneurs, a fact not lost on Sims.
“I’ve got no strings right now,” he said. “I live in an apartment on College Street drinking beer three nights a week. It’s not like I’ve got mouths to feed…So if I can fool around with T-shirts and stuff like that, now’s the time to do it.”
Though she’s unprepared to run her cake business on full-time basis at the moment, Wielonda thinks some day she would like to have a tiny storefront shop where people could pick up their cakes and see examples of her work.
“People don’t really know I exist, I think,” she says. “If I was more out there in the public, I would obviously get more business.”
Some challenges entrepreneurs and small business owners face are committing to their vision, learning business skills, gathering resources and staying motivated. Again, Roos says self-employment really is a choice.
And learning how to run a business is about trial and error.
“Don’t be afraid to go for it,” she said. “Don’t be afraid to scrape your knees and pull yourself back up.”
Filed by: Mariel Gomez