Are Small Businesses Dependent on the Presence of the Owner?

Many small businesses begin as one‑person operations. Most small business owners put in extremely long hours and seldom take vacations. Although such firms later employ other workers, the management style and personality of the owner seem to be necessary to the survival of the firm. Here are some examples.

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Ted and Ralph formed a partnership to operate a service station in a large midwestern city. Both were on the premises from 7 a.m. until closing at 8 p.m. Both were skilled at greeting the public, and they made many friends as business boomed. Although they maintained ownership of the station, Ted and Ralph began to spend time away from work, leaving capable subordinates in charge. But the firm just wasn’t the same without Ted and Ralph on hand, and business dropped. Ted and Ralph realized that to keep the station highly successful, they both had to be on the premises.

For many years, Mabel and Theo Harker operated Harker’s Cafe in a large city in the Southwest. Theo was the chief cook, and Mabel waited on customers who sat at the counter. Although they hired several other cooks and waitresses, Mabel and Theo were the stable core of the business. The two worked long hours, and business seemed to go more smoothly when the owners were there. Realizing how important they were personally to the success of the cafe, the Harkers never took a vacation and never left the cafe in the hands of the hired staff. Instead, in late summer and around Christmas, the Harkers closed down the entire cafe for a week at a time. Customers agreed that the place would not be Harker’s Cafe without Mabel and Theo.

Discussion Questions:

  • Why does it seem to be necessary for the owner(s) to be on the premises all the time?
  • Can there be personality cults in small businesses? Is it possible for customers to create a

personality cult around the owners of a business?

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