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    12 Replies Latest reply on Aug 20, 2008 7:56 PM by lalithabrahma

    How can I avoid 'start-up' mistakes?

    Persistent_1 Newbie
      Hi! Just joined (today) & am hoping that I can learn (as much as possible) how to avoid 'start-up' mistakes. About four years ago, I tried running a home-based business, while also working a full-time job, for a non-profit organization. My typical work week was between 45-62 hours. I spent thousands of dollars on a website, a business phone line, a separate business fax line, advertisement, etc.

      During the 24-months that my husband & I devoted to our own business, we spent approximately $6,000 & sold less than $500 in products. At the end of 24-months, we were out of money. We closed our business. My husband thinks that this was a valuable experience. I think it was an EXPENSIVE experience!

      I no longer work for the non-profit organization & don't' want to work for anyone else, again. Therefore, I MUST make a home-based business work! Well, I make beautiful handmade items, as gifts ... now I want to make these items, for a profit. However, I don't want to have an enormous overhead. I can't afford for this business to fail.

      Well, thanks for taking the time to read this ... I appreciate any advice.

      Persistent_1
        • Re: How can I avoid 'start-up' mistakes?
          LUCKIEST Guide
          1- You can avoid 'start-up' mistakes by visiting SCORE. SCORE helps people FREE.
          SCORE is a partner to Bank of America and provides FREE business assistance.
          SCORE in person or online can help you develop a Business And Marketing Plan
          that could help you succeed and avoid start up mistakes.
          P S Welcome to this website. LUCKIEST
          • Re: How can I avoid 'start-up' mistakes?
            CEO Space Scout
            Persistent,

            Welcome to the forum.

            I like your user name. I think that is one of the qualities of an entrepreneur.

            Starting with SCORE as Luckiest mentioned is a good start. They will help
            you to create a plan if you don't have one. And you DO need a plan.

            Also, when you are ready, check into CEO Space at www.ceospaceworld.com.

            It isn't for everyone, but it has helped a lot of people not make mistakes or
            correct quickly if they do. Our founder always says "hire the consultants you
            couldn't afford". At first I didn't know what he was talking about but once you are
            a member and learn our cooperative model, you see how you can get the
            people on your team whom you couldn't have afforded otherwise outside of
            CEO Space.

            Also, check into legitimate forums online of other people working from home like www.whydowork.com
            and sites that give you information like www.your-multiple-income-streams.com that give you a free e-book on how to successfully market online from people who have done it. I always say, take advice from people who have done it. Why reinvent the wheel.

             

            Best of Luck,

            Kathy
            • Re: How can I avoid 'start-up' mistakes?
              Lighthouse24 Ranger
              Best advice I can offer . . . before you make a single beautiful handmade item to sell (and certainly before you spend a penny on anything related to this new business venture), know these answers: Who is going to buy your products, and in what numbers? Where and how will people buy them (in stores, at craft shows, on-line)? How will people know those products exist and are for sale by you? What percentage of people who know your products exist will actually purchase one? How much will it cost you to make your products, market them, and sell them? How much will people pay for the products? Can you make a satisfactory profit on the difference?

              In your first enterprise, it sounds like you over-estimated your projected sales, and incurred costs (spent money) before you really knew how you were going to generate revenue (make money). Please don't feel bad, though, because about 50 million people made that same mistake right along with you (and in case you think I picked that number out of thin air, I didn't -- there really were approximately 50 million people who launched a new business last year without even a hint of anything that resembled a business plan -- and about 60 percent of them will fail for that reason alone).

              So . . . plan to succeed this time. As I hope you are already discovering, there is a lot of help available. Best wishes!
                • Re: How can I avoid 'start-up' mistakes?
                  EL_DollarShop Adventurer
                  Lighthouse were we seperated at birth, and I did not know it?
                  The adivice you gave has been superb to this recent post on this sight, but darn if if even my wife says you sound like me!

                  Oh an Luckiest, geez that has to be the most inspiring to others I have ever seen you write, as well as the longest I seen you do!

                  Please continue what you do, everyone needs the inspiration!
                • Re: How can I avoid 'start-up' mistakes?
                  LUCKIEST Guide

                  <!-- top roundy brown border -->

                  h3. Steps to Small Business Success
                  1. Start Smart
                  2. Plan Ahead
                  3. Set up Systems
                  4. Seek out Sales
                  5. Aim for Growth
                  6. Leverage Opportunities
                  it

                   

                   

                  1. Start Smart.
                  Identify a niche. Don't compete to be the lowest cost provider. Look
                  for what makes your product or service unique and adds a special value
                  for the client and charge for that value. Every business has many
                  facets. Start with what you know and like; start a business that has
                  meaning to you. Keep in mind that we don't know what the future holds,
                  many of the jobs and businesses of tomorrow don't exist today. You can
                  create your own success.

                   


                  Now is the time to dream. To start smart, you should like the idea of
                  the business. The way to earn a good income and build wealth is by
                  serving clients well, making their life better in some way-it's more
                  than filling a need in the marketplace. To succeed you want to test the
                  idea to make sure your potential clients like the idea too. Test your
                  ideas.

                  2. Plan Ahead.
                  People often ask me why bother with a business plan? Look at the
                  lottery as an example. You may get lucky and get the winning ticket,
                  but the odds are against you when you rely on random chance. I'm a risk
                  taker...but not that much, minimize the risk of going into business and
                  maximize your potential for success. Take the time to write a plan of
                  how you get from point A to point B. A plan gives you a clear future
                  focus and increases your chances of success.

                   


                  The first rule of a start-up is put some of your own money in the
                  business. As the owner you must be willing to capitalize the business.
                  The second rule is put as little of your own money as possible in the
                  business. Prepare your plan and look for funding for your business from
                  multiple sources, which can include a business loan or business line of
                  credit.

                   


                  Don't go it alone. Plan ahead now to build your team. Your team may
                  include a CPA and an attorney that you work with as needed. Add a
                  mentor from your industry and get a SCORE mentor to help you plan for
                  success. No one has all the answers. You get more ideas and information
                  by building a success, support team that can help you plan ahead.

                  3. Set up Systems.
                  The most basic system every business should have is a good financial
                  system. Ask yourself how am I going to generate enough income to
                  support myself and my family. Begin here. Put together a personal
                  budget, so you know what it costs you to live. Now, you can move on to
                  the business budget and sales planning, so you can see how many sales
                  you need to break even and make a profit. The start-up expense plan,
                  operating budget and your accounting software are vital to your
                  success.

                   

                   

                  4. Seek out Sales.
                  The daunting question is how do you go about seeking out your first
                  sale. Recognize that since you don't have a big ad budget to be seen by
                  everyone, you need to target a niche and get connected in your market
                  community, be it local, regional or national. You need other people
                  selling for you-not employees-goodwill referrals. Get out and talk to
                  as many people as you can. Join organizations that would have clients
                  for your product or service. Become a visible part of your market, and
                  then ask for the sale. You begin the sales process with people that you
                  know. Yes, it's okay to start with friends and family as your first
                  customers, and then broaden from there.

                   

                   

                  5. Aim for Growth.
                  The basic tenant of creating a company is that you own the company. You
                  are not just creating a job for yourself. It's less risk and less
                  investment to get a job. Building a business is creating a company that
                  is more than the job itself. Think about the future. How large do you
                  want the company to be in terms of sales, net profit and employees?
                  Your answer to each of these questions will influence how you grow.
                  There are varying costs and profits associated with growth. It's
                  important to make a deliberate choice early about how you want to grow
                  your company.

                   

                   

                  6. Leverage Opportunities.
                  Good luck. Good fortune. Good timing. All play a part in business. As a
                  business owner, be very clear about your core focus for the business
                  and how it serves clients. Your core business is what pays the bills.
                  Then, as an entrepreneur you are about opportunity. When you see a
                  potential opportunity or stroke of luck measure it against your core
                  business focus. Good fortune is great, when it matches your vision for
                  the business. Always consider if a good opportunity is the right fit
                  for your business. If something looks great, but it's not in sync with
                  your long-term plan and budget, think carefully before committing your
                  company's resources.

                   


                  Take advantage of good opportunities that make sense for you long term.
                  A perfect example is McDonalds. Ray Krock started a small business that
                  became a large franchise network with a consistent product, consistent
                  systems and an ability to seize opportunities such as the Arch card and
                  offering healthy salads to meet the interests of today's consumers.

                  • Re: How can I avoid 'start-up' mistakes?
                    HelpEconomy Wayfarer
                    I did the same as you. It is sickining. I lost a lot of money also.

                    1. Don't give any money out.

                    I had some friends that knew that I was looking for a home based business.

                    And they tested the waters. Was I everglad because I was getting poor from
                    testing the waters.

                    2. Best thing is for you to go to my final stomping grounds and check it out.

                    http://ireneferguson.drinkactweb.com

                    3. when it is FREE it is a NO Risk and a NOBrainer.

                    It sure took the weight off my back

                     

                    To Your Future

                     

                    IreneFerguson

                    And Yes I am a real person.
                    call me at 515-210-2997

                    • Re: How can I avoid 'start-up' mistakes?
                      BizGuru Wayfarer

                      Also, understand your market and its size. Spend time on creating the emotional connection you can create between your product/service and the market.
                      • Re: How can I avoid 'start-up' mistakes?
                        BrandExpert Newbie
                        If it's a really good book you're after, read The Revenge of Brand X: How to Build a Big Time Brand on the Web or Anyplace Else. You can get it at Amazon or at http://www.revengeofbrandx.com (I think). It covers a lot of the things you might be looking for, including the fact that people waste a ton of money advertising before they really know what or why they're advertising anything. A real eye opener...
                        • Re: How can I avoid 'start-up' mistakes?
                          lalithabrahma Adventurer
                          Have you tried selling on ebay/amazon.com/cafepress.com? I feel you can make a good profit.
                          Lalitha
                          Want to protect your family and Grow your business with peace of mind? Sign up for educational series at www.lalithabrahma.com