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Just a quick note to you. Good Luck!! Best advice ( 1 ) YOU NEVER HAVE ENOUGH CASH ( 2 ) NEVER UNDERESTIMATE COSTS.
Being in the process of planning to own your own business one day is the American dream.
Tell us more about yourself, like education, work experiences and what kind of business.
I could write a book (and there have been many books) on the subject.
Two suggestions. 1) Develop a BUSINESS and MARKETING PLAN
2) Visit SCORE in person or on line. They help people going into business for FREE.
Good luck, LUCKIEST
1 of 1 people found this helpful
- You can never have too much cash
- You can never overplan
- You can never disappoint good clients
- You can never keep bad clients
- Never mix business and personal cash
- Always keep solid business records
- When dealing with the government it is best to overpay and pay early
- When dealing with clients it is always best to under promise and over deliver
- When borrowing from family or friends to start a business, always have a contract
- Never rely on others when you gut tells you something you believe
(1) Take it easy.1 of 1 people found this helpful
Probably the one attribute that I have that has really paid off so far is patience. I have found that things come at their own pace no matter how much of a hard charger I am. Sitting back and thinking about things, researching everything and diligent (but flexible) planning have brought their own and often unexpected rewards. I would diligently and excitedly check my web reply inbox for new prospects and sales leads to work. But my best client came to me from a referral from my dentist who contacted me through an email address I use when I anticipate getting spammed and only check about once a week. At first when my site hits would drop off, I would scramble to analyze everything. I would reconfigure my web site, increase online advertising spending and tweek keywords to death. The site hits would return and I would congratulate myself on a job well done and get some sleep. This happened over and over untill I came to realize that my web site is as cyclical as the markets that are my business. Now when the web hits drop off, I give it a little time and guess what. It picks up on its own and I sleep more.
(2) At least try to do it yourself.
I knew what I was capable of doing. What I didn't know was that I was capable of doing things that I never tried before. Creating a website for example. Marketing a website is another example. Heck - starting my own business is yet another example. I had the honor of cross training with the infamous British SAS commandos. Their motto is one that I will never forget and have chosen to live by "Who Dares - Wins." This is so true. If you do not even try, there is absolutely no way to win. By doing things myself at first, I learned about areas of business that surprise and assist me in my everyday decision making. I am by no means an expert at any of it, but am confident in my basic knowledge of the areas. I also leave areas that require expertise to the experts; such as legal, accounting, insurance etc.
(3) If the experts give you information free (like a lot of posts on this site) cherish it.
The internet is a wealth of information. Some good and some completely self serving as with anything in business. One expert in small business is the Small Business Administration in the United States. They have probably seen and heard it all. Good and bad. They have been assisting small businesses for a very long time and know what works and what doesn't. They are considered by many to be the experts at small business and have an excellent planning resource at http://www.sba.gov/smallbusinessplanner/index.html which they offer at the special introductory price of - FREE.
Best of luck to you in your endeavor and remember the triple bottom line. People - Planet - Profits.
I enjoyed reading your response and I also found more help from you to a question I posted last week on Taxes - 1031 For capital gain when selling a business. The link http://www.sba.gov/smallbusinessplanner/index.html has an abundance of information that one of my SCORE councilors told me about but I forgot over the years. Thank you..
1, Business is not a friendship. Your friends are not business partners, business partners are not friends. Never mix it.
2, Set up the value proposition of your business. What is the real value for your customers, which is provided by you?
3, Focus on your clients, and their wants.
4, You have to have a business plan.
5, Select partners, colleguaes who shares your values.
6, Being entrepreneur is hard somethimes, never give up....
7, Set up goals, reach them and you will have fun. A lot! :)
BE nice to everyone!!!!! Start making your contact list now. People will remember how you make them feel not what you said.
Hi Metrogal, when you first begin the process of starting a home based business there are four areas you should research.
1. *The Company*- get involved with a company that has a track record, is it listed on the New York Stock Exchange, etc. Has it had a continuous profit over the last 5 years or so. Does it have the ability for growth into the next generation and subsequent generations, has it grown consistently over the past 5 years. Always, ALWAYS, use due diligent's in researching a company before getting involved.
2. The Product - Is it something a majority of the public can use. Is it affordable to the masses.
3. Timing in the Marketplace - Make sure it is a product that is not over saturated such as cell phones and long distance plans. Is it a product that will be needed by future generations, that way you will be able to market it successfully in the future. Always start when the penetration in the Marketplace is below 5%, before that you experience doubt then ridicule and finally acceptance, that is when the masses see the need for your product, that usually happens when the 5% exposure is reached, then you will hit critical mass, that is when a product realizes an accelerated growth. This is the route HMO's took as did the Cell Phone industry.
4. Compensation - Make sure you have the potential to make money immediately, and in the future. Make sure the Company you partner with is in Profit mode and has been in the Past 5 years or more.
Finally make sure it a product you feel proud to market, never try to talk someone into buying your product or services, rather educate and inform the public so that they can buy your product, using their own free will, and continue to use it as the years go by, when you talk (sell) someone into making a purchase they usually get buyers remorse.
Good Luck, if you need any more help feel free to ask.
Network, Network, Network - there are some great members of this forum, from the counselors at SCORE to posters like DomainDiva and WebBillions. My advice is once you find what you like doing find someone who has done it before or done something similar and learn, learn, learn!
There's not much I can say that has not already been said. A business plan is an obvious good start. Know who you're going to target, and always keep tabs on the industry you're going to be in and your competition. Know your limitations. Trying to do everything is fine, but don't overwhelm yourself. Pace yourself, for sure. You're not going to be rich overnight, so don't expect it. Never undermind your network (computers, etc). I can not tell you the number of people I have run into that made so many mistakes with their network, trying to cut costs...then one day, it was all gone...because of 1 little spoof email. Know when to turn away from bad customers. I myself have recently encountered a customer who couldn't pay for our services. Long story short, he had also written 5 months worth of bad checks on his office lease, spent money he didn't have yet on other projects, and couldn't deliver the product. So, though I could have taken him to court, got a judgement, etc, I still may never see any money. That whole legal battle would only cost me more money, to which I would be trying to get something from someone who obviously has nothing. Walk away is the best thing you can do in a situation like that. Call it a loss, and move on. Then there's capital.....I don't have much advice on that issue, I'm still working on it myself! Good luck with your ventures, though!!!
If you are married or in a relationship having the support of your significant other is so important. Starting my business caused me to go through a divorce as my ex-wife didn't share my dream. She saw me quitting what she viewed as a good job to do what she amounted to cutting grass. She couldn't understand that the "job" I had was chocking the life out of me.
Well today thank goodness, my cutting grass hobby has turned into a business that has allowed me to be a lot more prosperous than I ever would have been working that "job".
The trouble in my marriage caused a lot of problems for me and my business early on, but I had a dream and saw it through.
Starting a Business is very exciting, scary and rewarding. One of the best ways to lower your financial risk is to continue working while you build the company. Then go find a customer who will buy your product or service. Once you find the customer quickly incorporate your business (around $500 if you use an online service http://www.mycompany.com). They will pull all the legal documents together for you and have a host of services you can subscribe to. I also offer a start up package (website and office materials like business cards, stationary, etc details are listed on my website http://www.qualifiedconsultantsllc.com). To give your customers a live person to speak with while you are working, subscribe to a professional and affordable 24x7 phone answering service provider (for more information about a local St. Louis vendor offering this type of service email mailto:email@example.com and they will send you an email after each call so you stay in touch with your customer.
If you find the customer first you generate revenue (make sure you agree to payment terms). The good news is that by working you still make money to support your household and you can put all the money received from sales back into the business or pay for business tools, equipment, licenses etc. Next, you will want to go to 2 seperate banks to make inquiry into see if you qualify for a line of credit (you'll need to use your home, 401k etc. for collateral). Get the loan but, don't use it. Even if you don't use it may cost you closing costs etc that you can write off at the end of the year. Using this approach, my first 6 months in business we generated over $240k in billings. By the second 6 months of the year we had generated over $390k in gross revenues. The difficulty is that you have to say or pray everyday that you receive the courage, strength and gain the wisdom to keep the business growing while you remain working. Use the net income to pay off any bills at home before quiting your day job. When your business generates a level of income you need/want you can then work within your business full time.
Wishing you continued success mailto:firstname.lastname@example.org.
Six lessons.... and two bonus points.
1) Focus: Know what you want to do. Who your customers are, what value they want to buy, how they like to buy, and why they should buy from you more than they buy from your competitors. Get as much real data as you can, for example, run your business as a "hobby" for a while to learn the ropes and figure out how the pieces go together. Don't give up your day job first!
2) Sales and Marketing Process. You'll sleep comfortably in direct proportion to the cash flow you have coming in and the predictability and level of potential business in your pipeline. Figure out in advance how you will sell and market and build demand and customers. A lot of people assume "if we have a business, they will come." Wrong, wrong, wrong, most of the time.
3) Do a budget. Know what you can afford and what you can't. Concentrate your resources in places that will produce sales and cash flow fast. Keep things simple.
4) Funding: Have at least six months personal and business expenses in the bank. A year would be better. This will help sustain you through the slow times as you start and help you avoid the temptation to make stupid decisions because you need to eat. Have your "back up" funding sources in place. A couple of extra credit cards is how I did it. But, having a home equity loan or family money or friends who will help you is also a relief.
5) Set up your book keeping. A lot of small business owners use a shoe box as their record keeping method. Buy Quicken or Quickbooks, learn how to use it, set up real files, and start your record keeping etc. the right way from the beginning.
6) Find a mentor, someone you can go to with your questions and who has the type of experience you need to answer your questions. Probably not your attorney or CPA. Probably someone in a similar business.
Bonus points: Be prepared psychologically and financially to go "belly up" at least once in the first three years. I tried that three times in the first seven years, it scared the h*** out of me, and I'm really careful now about managing the business. Finally, read "The E-Myth, Revisited."
Hope that helps!
It's amazing to see the consistency among the preceding posts. Main lesson -- cash.
Gut Instinct! If it feels RIGHT do it! REMEMBER THEIR IS NO FREE LUNCH ! !
Watch Out For The+ FALSE POSITIVE..+ This I Think Is A BIG Downfall To Most New Business Owners. They see a small gain and go crazy thinking that they have all this cash WRONG!!!! My Wife & I worked close to 4 years with out drawing a pay check out of the business, just an occasional $300.00 for Groceries to live on. Our Money came from savings that we brought with us to live on from a past life to cary us over for 5- 7 years.
Just look at Oil prices when we bought the business we paid $1.05 per gal. Now we pay $3.00 per gal. Well
we can't increase our rates that much because no one will pay it and yet we need to be competitive . We all hurt and we can not raise our rates because no one will pay it This is what I'm saying invest 1 and save 1 to cary you over the BAD times..... Just when you think all is good + LOOKOUT+ ~ Tommy Joe
Good subject! I'm enjoying everyone's responses.
When I started my first company, I'd had P&L responsibility at larger firms, knew a lot about business in general, and had proven expertise in my vocation -- but I didn't know enough about people. Some business owners come by their "people skills" naturally, but I had to develop and consciously practice mine.
Honestly, when I first started out, the actions of customers, potential customers, employees, and suppliers would absolutely bewilder (and frustrate) me at times. I probably said, "What's wrong with these people?" nearly every day for the first few months. So the most important lessons I learned (through books, classes, and experience) were in the area of human motivation and behavior -- truly understanding why people did the things they did, and recognizing what adjustments I could make in the content, medium, and/or style of my communications to get better results for everyone.
I would say the scariness of not having a regular income for a while and also learning to become the best salesperson around.
Check this site.. it will help you a lot. it helped me.. It's a blog about "My son, the business teacher".. just found it to be very amusing and informative..not my blog.. you should check it out.. you'll definitely learn a lot.. Goodluck!!
putting ads on Google was like throwing money in the toilet for me..
Watch out with that.. and Facebook ads too..
Here is something that I have learned from 26 years of experience in business. it might help you with planning your first business:
Is the money you can make important? Absolutely!
Is how you make it important? Yes, if making your life more comfortable is also one of your goals!
This would factor in because if you started or bought a business that is capital intensive and/or heavily regulated and competitive you could find out that the business became the worst high-pressure job you ever had.
Any industry or market that is growing fast is probably also a highly competitive one (and may become increasingly so). Unless you have a lot of money behind you it is better to think tactically than strategically about entering such a market.
I tell clients and people that I talk with about starting or buying a business to be methodical in how they approach either one. Don't jump ship, leave your job and pin all your hopes on something (the start-up or business you buy) trusting that all will be well. Sometimes they aren't.
I've been successful in several businesses (from writing, publishing, manufacturing to business services) but have also had flops. That's normal experience for someone who's been an entrepreneur for 26 years. Often you learn more from your failures than you do the successes. Odd but true.
- Take the elements of the things you have tried in the past that you spent time and money in exploring as business opportunities but that did not work out (and do this also for your current job).
- On a sheet of paper draw a line down the middle of it. On the left at the top of the page write "Bad" and on the right top write "Good".
- For each thing list out the bad and the good; the bad will constitute the determinants of why it did not work out for you or why it did not make you happy or fill you with any passion. The good are the positive elements that helped offset the bad but did not carry enough weight to make it work for you.
- Once you have done that look at what you've written. Take a new sheet of paper and transfer all the good things to that page. This becomes a profile of the things that were positive that you need to look for in a business or opportunity that may ignite your passion.
- Now with your "Good" profile in front of you, take the market or industry that interests you, think about how you can utilize those good aspects in a business of your own serving that specific market or industry. Make notes about the different businesses that you can start or buy that have those good aspects to them. Those should be your focus.
- Once you've done that calculate what I call your Personal Economic Burden (all your monthly personal expenses that you need to pay to live: mortgage, rent, insurance, food, utilities, car payments, etc.). Total that up and add 20% to it (10% for miscellaneous and at least 10% for savings). Take that total amount multiply by 12 and divide by 365. That is the daily amount your business must generate for you to be "comfortable". We'll call that the "Comfort Number". That's not making you rich but if you achieve it; it will give you a solid foundation to build on so that you can make even more money.
- When you have that daily number and with it in mind, review your notes from number 5 above and research to determine if you feel that business can generate what you need to meet your Comfo \\ \\ \\ Dennis Lowery \\ \\ \\ Adducent, Inc.