Skip to content

What’s so bad about being a small trader?

September 25, 2008

So your child comes to you one day saying, “Mummy, daddy, when I finish school I want to set up a business selling my favorite food. Wantan mee!!”

How do you react? Recoil in horror? Scold him or her?

This is not about what the child said as it is about how people react to it. So, what’s so bad about being a small trader?

Consider this. Take an average hawker and an average salaried employee, both having been at it for 20 years (taking averages reduces the “it depends” scenario). Set all appearances aside and look at their assets. Who do you suppose is better off?

I wouldn’t be so quick to assume that the employee is the one better off. Know why? Cash flow and liabilities. 1st, the small trader probably has a lower burn rate. He’s less likely to develop exorbitant tastes like $30 lunches and dinners or spend thousands on office wardrobes & accessories. 2nd, he doesn’t have time to indulge in luxuries like long holidays. All that money ends up in savings provided he doesn’t gamble it away. 3rd, because no bank will lend him money, he’s forced to live frugally and buy things in cash, making his net liabilities lower.

Yes there’s loan sharks and all but if you compare it against employee debt (credit cards, personal loans, etc), what’s the difference.

Some say small traders suffer a lot more stress. Really? Because when I look at the number of people screwed over by office politics, I say everyone’s about even.

And then there’s this thing about job security, long hours and problem customers, things that exist on both sides in one form or another.

Can’t find too many differences can you. I see a few…

  • As a professional you conform to a dress code. As a trader, you wear whatever you like.
  • As a professional you see your money once a month. As a trader you get it every day.
  • At work you’re stuck with bad bosses and bad customers. As a trader you get your share of annoying people too except you’re not stuck with the same faces every day.
  • As a professional you get to enjoy a classy office. As a trader, your setup may not be much to look at and your relatives might be too embarrassed to mention you.

But going strictly by results, things are not always what they seem. Makes you wonder which is more important doesn’t it, the destination (= financial independence in this case) or the journey.

[Ruminations with Ah Liew, an Altis-driving hawker who’s surprised I don’t want char siew with my wantan mee.]

4 Comments leave one →
  1. September 25, 2008 10:04 am

    it really depends on what you want. not everyone can spend such long hour in hawker area. dress code n stuff…as a hawker u need to rent the hawker stall, buy the ingredients, wake up early in the morning to prepare, hire workers, cleanliness, taste, etc etc. A lot of other things for a hawker to consider as well.

    Money? It’s up to the individual on how to spend it.

    And loan shark? Their interest rate is much higher than that of the banks. 😛

    in the end, pros n cons for each job. haha.

    The wantan-mee hawker I chatted with was an ex-remisier who pulled in a 5-digit income before the market crashed in the 90’s. He became a bankrupt and was forced to become a hawker to survive. 12 years later he made enough to buy a house and a new Toyota Altis. I asked him if he would consider joining back a broker firm and he said no way, he preferred a simple life with no headache.

  2. LC Teh permalink
    September 25, 2008 4:04 pm

    “All that money ends up in savings provided he doesn’t gamble it away.”

    You got that right. I know of some cases who end up on the hit-list of Ah Longs. They have that weekend habit of ‘feeding the horses’.

    Its either that or lotteries and worse, Genting.

  3. September 25, 2008 7:14 pm

    You are right but society’s perception is a small trader is a low-status job. For many, it’s better to sit in an air-conditioned office slaving away for pennies rather than to be your own (small trader) boss.

    Hypothetically, it were me, I would see whether my children would be suited for a small trader job. Probably, I’d ask him to cast his net wider and consider aiming for a franchise if his business is successfully.

    So,what would be your personal reaction, Damien?

    I’d ask the child what she likes about being a hawker and give her words of encouragement. Then when she finishes her education I’ll ask her again, you still wanna be a hawker?

    There are hawkers and there are hawkers. Some successful restaurants with million-dollar annual incomes have humble beginnings. Some grow into food packaging and like you said, franchising. I’ve learnt never to underestimate.

  4. September 26, 2008 12:26 am

    it’s what you want in life at the end of the day. To some, there’s more to life than just having a big-fat figure sitting in your savings account. Sometimes money alone is not enough to buy personal satisfaction and achievement. For me personally, I know for a fact money alone is not my sole motivator in this world.

    My motto has always been : love what you do, the money will come naturally. Call me naive, but I find that way of life to be more “liberating” than being a slave to money…well that’s just me anyway 😉

    And dude, just a personal thought here, that ex-remisier friend of yours, for all you know, I’d fancy that he must be active in the stock market and in mutual funds.

    Absolutely. I’ve no doubt small traders develop an ability to sniff out a good deal. Which is another thing about the tough life – you tend to explore opportunities that comfy people don’t usually bother with.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: