When you're starting a home business, it's all too easy to make mistakes -- after all, you've never done this before. Fortunately for you, though, you can learn from others' errors, by making sure you don't do any of these things.
Thinking Skills You Don't Have Aren't Important.
So you have no idea how to keep records and accounts, or you don't know how to maintain a mailing list. You need to learn these things! Too many home business owners just do the things that they know how to do, and assume that they can probably get by without everything else.
You need to realise that when you're running a home business, you're going to need to do as much as you can for yourself, especially when you're starting out. This means that you can't get by if your business skills are lacking. I always say that everyone who is thinking of starting a business should take an inexpensive and quick local business course, and I stand by it -- even if you think you'll be fine, it can't hurt, can it?
Not Managing Your Time.
When you're used to working nine to five, an easy trap to fall into is not managing your time effectively. Your home is full of distractions, and there won't be anyone there to tell you to get on with it. If you're prone to daydreaming or procrastinating then this can be disastrous -- whole days can go by with only tiny amounts of work getting done.
You need to be sure that you have a schedule, and you stick to it. Draw a clear line between work and non-work time, and don't cross the line in either direction. Apart from that, the word to remember is 'prioritise': appreciate that you won't always be able to do everything, but make sure you get at least the important things done.
Making Clients Think You're a Joke.
There are many home businesses where clients might need to visit your home -- but make sure it's fit for visiting! You can't lead them into a messy office, or be holding your dog back from barking at them when you first meet. Remember that professionalism is important, and it's too easy to end up looking silly if you don't plan how you're going to make a good impression when you invite people to your home.
If you can't afford a 'business annex' to your house, then consider hiring someone to look after your dog or children for a few hours while you have a business meeting there. It might also be worth paying a cleaner to give the place a quick once-over, if you haven't had time to clean up for a while.
Not Specialising.
Too many home businesses, when asked who their target market is, say 'well everyone, silly'. Your target market is never everyone -- if it is, you will fail. You can't just choose an industry and advertise your new-found profession to everyone, in the hope that someone will work out that the fact you're an electrician means maybe they should ask you about re-wiring their house.
The key to success is this: think about what you can do, and then market that to people who will want it. Advertise in places where these people are. If your business has no target market, then you have no business, period.
Making Start-Up Costs Too High.
Finally, too many people overestimate how much money it's going to take to start a home business. Do you really all brand-new equipment? If you're spending thousands of dollars before you've made any sales at all, you're setting yourself up for a disappointment.
Start your business on a shoestring, work hard, and expand gradually -- otherwise you're setting yourself up for a big fall. However much you might think you ought to do things 'properly', you need to make sure that you're minimising costs and maximising profit every step of the way, otherwise you're failing yourself as a home business owner. It's when you start to get some bigger clients and better cashflow that you can start paying a little extra to make your business life more comfortable.
The Biggest Mistakes That People Make When Starting A Home Business...
Pitfall Performance: The Biggest Pitfalls For The Home Business
Joe hated his job. Nothing would make him happier than walking into his boss's office and simply saying, "I quit!" before he walked out the door at the end of the day. But Joe couldn't quit his job. After all, he liked to eat. After some soul searching and brain storming, Joe came up with the perfect idea for a home business. So he started the ball rolling, walked into his boss's office, and joyfully proclaimed those words he dreamed about for so long: "I quit!" With his dream in his head and his heart full of hope, Joe will begin the same journey that so many home business owners begin. He must be aware, however, of the various pitfalls that await him in his journey.
Home business owners must first of all understand finance. The vast majority of business men and women will tell us that to make money we need money. However, this myth has led many into the path of financial destruction, with unpaid and defaulted loans along with broken lives. The first mistake that many home business owners make revolve around their personal finances: they borrow start up money for a pipe dream. Thus the first dollar they make really isn't theirs. It's their lenders. They begin treading water in a pool of debt instead of building a mountain of wealth.
While home business ownership offers flexible hours, it does mean that the individual has the option of not working. Quite simply, many home businesses fail because of sheer laziness and lack of discipline. A home business owner must understand the need to keep regular hours and to work just as diligently if not more diligently on this job than he has on any other. He is working for himself now, and while he cannot fire himself for poor work habits, he can simply watch his company collapse while he's at the beach catching some waves or fishing in a lake with his buddies.
A great idea, start up money, and some discipline will get a home business owner a long ways. He will have the drive to do well, the finances to back it, and the great idea to sell. However, home businesses with all of these elements in place can still fail due to another major pitfall: poor marketing. Many home business owners do not own a business degree. Thus they never took a class in marketing or advertising, and they do not understand how to properly market their product. After all, shouldn't a good product sell itself? Why market? Why advertise? A great marketing teacher will explain the need to market even the best product well. Others will not know about the product without great marketing, and even a marginal product can do well with excellent marketing techniques. Those beginning their own business can improve their business even more with just some basic marketing guides. Guerilla Marketing has proven to be a great help to those first starting a business.
Finally, with drive, start up money, discipline, and marketing in place, the home business fails in one other aspect if the owner does not have the necessary experience: taxes. Home businesses have the potential to generate a substantial income, but the home business owner who came from the corporate world typically has no experience in doing the taxes for another business. Many think they can do their own taxes, but they fail to recognize important deductions and tax laws, and thus they should consider the value of a Certified Public Accountant.
Home business ownership is a scary and exciting venture. Those who take that path in life must be fully aware of the dangers that lie ahead so they know where to guide their business.
Business Owner's Essentials - The 5 Biggest Challenges for Today's Business Owner
Copyright 2006 Andy Warren
Some of these challenges have been around since business began and others are new ones that are being faced as technology and the marketplace evolves. As a business owner, you need to be sure that you are handling each of these effectively and looking out for where they might destroy your business.
1. Cashflow Management
This is the number one essential for all businesses, no matter what stage they are at. Even the most successful businesses can fail if they take their eye off the ball on cash. Your cashflow is the difference between how fast money comes into your business from your customers and how fast you pay it out to your staff, your suppliers and the tax man.
Many business owners don’t realise that their cashflow can be at most risk when they are growing fast or taking on big orders. This happens because, in most businesses, products and raw materials have to be bought and paid for before they can be provided to customers and billed. This is also similar for services, where your employees and contractors have to be paid at the end of the month but the client may not be billed until the following month or when a job is completed. And they may not pay you until some time after that.
In periods of high growth your costs can go up and out of the door long before the cash from the increased sales comes in. And suddenly you find you have a cash crisis on your hands.
2. Your staff
Your employees can make or break your business. When you choose the right ones they can massively add to the value of your business. When you get the wrong ones they can be a drain on your time, your money and they can hold back your business.
The usual mistakes made include recruiting people who are not as smart as you so that they make you look good; Hiring too fast and firing too slowly; Not investing in training and development for your staff; Not listening to what they’re telling you; Not taking up proper references when recruiting; Not adopting good, consistent and fair HR policies within the company.
Many business owners find that employee issues are the number one drain on their time and attention. And often the issues don't get resolved and lead to litigation and expensive legal bills.
The first key is to recruit high quality people, who are smarter than you, who are motivated to build and grow your business and who come with a good track record. Also, always take up references and carefully check CVs or Resumés for any gaps or inconsistencies.
The next key is to treat your staff fairly and reward them for good work. Whatever you measure and reward will get done more, so consider this carefully. Create clear and consistent policies for employee development and training and make sure you allow good time for one-to-one reviews where the discussion is allowed to be open and frank.
And above all, keep the lines of communication open and clear and trust them.
3. Getting Noticed in a Crowded Market
You may have a great product or service but unless your potential customers know what you provide you’ll never have a great business. You need to get out into the market and deliver your message to the people you want as customers.
The challenge comes with the fact that today people receive an average of 3,000 marketing messages a day. And they’ve become immune to many of them. Your job is to be able to cut through all those messages and stand out enough to get noticed by your customer.
The best way to achieve this is by focussing on a niche. This way you can target your marketing with a laser focus to match your desired customers directly. And when you specifically target your prospects with a message that is tailored to them and their needs, they’re far more likely to take notice and listen.
The standard reaction to this is to worry that by focussing on one niche you could miss out on other customers. The reality is that the scatter gun approach that throws your message out to anyone and everyone is extremely hit and miss in its results. And it rarely works now because the message becomes so generic that no-one believes it applies to them. Remember, you can always select another niche once you’ve worked the first one. So you can eventually get to all of your potential market in a far more effective and targeted way.
4. Poor planning
It’s said that when you don’t know where you’re going, any road will get you there. This means that without a clear plan and objective you can get distracted and diverted all over the place and never achieve what you really want for your business.
When businesses fail to plan they find themselves losing money, losing staff, losing momentum, losing customers and losing business.
Without a plan, you won’t know whether you’re on the right track and you’ll have no guide as to whether you need to go faster or approach the business in a different way. Stumbling through simply doesn’t cut it for a good business.
Making plans allows you to prepare for more eventualities. It allows you to foresee potential problems and avoid crises. It actually gives you more flexibility because you can flex around your plan and revise it as you go. It also makes it easier to make decisions because you have something to judge the outcome against. You’re able to assess whether taking a specific decision takes you further along your plan or moves you away from it.
5. Neglecting customers
The final challenge that is faced by every business in this supposedly service oriented world is neglecting customers.
After all the uphill struggle of finding a prospect, telling them about your product or service and closing a sale, are you just going to let them go? Many businesses do. They are so focussed on making new sales that they forget that the best source of additional sales and new business referrals comes from their existing customer base.
They also forget that when you neglect a customer and lose them, they will tell others. And as a customer with experience they will be believed and that can knock a significant hole in all your marketing efforts.
It costs significantly more to find and sell to a new customer than it does to keep and sell more to an existing customer. Make sure you get your customers' contact details, look after them and keep building and strengthening the relationship. The first sale should be just the beginning.
And a happy, satisfied customer can do more to market your business than almost anything else.
Business Marketing Mistakes: 3 Biggest Marketing Mistakes Every Business Manager Makes
Who hasn’t let a typo slip by or misspelled the CEO’s name or printed the wrong phone number somewhere? Those marketing mistakes don’t warrant an article. In fact, just one word of how-to-fix-it advice is sufficient: proofread!
Here are a few more important marketing mistakes that just about every business manager out there makes, along with a recommended fix that will help you attract more business and get better results from your marketing, regardless of how big or small your marketing budget is.
Mistake #1: We think that marketing is something we 'do'.
"We need to do some marketing." It’s the first thing you think when you need to boost business. Problem is, when you think of marketing as something you 'do', you’re usually thinking about publicity, direct mail, flyers, email, ads and promotion. Marketing is much more than merely promotion, and it’s rarely a quick fix.
The real fix is to expand your definition of marketing. Instead of thinking of it as something you 'do', think of marketing as anything that helps or hinders the sale or use of your product or service. This includes: your location, the attitudes of the person who answers the phone, your name, pricing, policies, proposals, personality and more.
Before you write a promotional word, do a 'help or hinder' once-over. Make a list of what’s helping you attract business and what’s getting in the way. Figure out what obstacles you can quickly fix or remove? What 'helps' can you enhance or spotlight? Until the help-or-hinder homework is done, working on promotion is premature.
Mistake #2: We breathe too much of our own exhaust.
We are such big believers in our businesses that we can’t wait to show it off. We admire our attributes and inhale our excellence. Then we exhale it all into our marketing communications. The problem is, when you do that, your marketing is all about you. And people don’t care about you. They care about themselves.
If your marketing is going to get any response at all, the first thing it must do is connect to something prospects care about. Connect before you convince. Try this four-step exercise:
1. Describe your products and services. Get the exhaust fumes out.
2. Identify one or two attributes or attraction factors.
3. What is the benefit, the need or the want, that is satisfied by those attributes?
4. Why is that benefit important, personally, to the target audience?
For example, Joy dishwashing liquid (descprition) has real lemon (attribute) that cuts grease and leaves dishes shinier (benefit). What a nice reflection on you! (Connects to what a mother cares about.) Connect to what people want. Not to what you do.
Mistake #3: We all look alike.
A bank is a bank is a bank. Realtors, lawyers and consultants are a dime a dozen. The list goes on. But here’s the good news: the more two businesses look alike, the more important each difference becomes, and the more impact even the tiniest difference will have on setting you apart. Why?
Consider identical twins. What’s the first thing you do when you meet a pair? You try to find a little something to tell them apart. The same is true for your business. Your prospects are looking for a point of difference (just about anything )they can use to set you apart from your competition.
To find your points of difference, start with your points of contact, or 'touch points' in your company. Make a list. Business card, fax cover sheet, invoice, phone greeting, front door, home page, etc. Then look at what the competition does and ask yourself how you can do it differently. Just a little bit will make a big difference, because your prospects are looking for them.
For now, try the Help or Hinder, Connect Before You Convince and Find Your Points of Difference tools to make your marketing more meaningful and effective. Be wary, too, of unrealistic expectations, faulty research, deadly bullet points and lack of follow through-- four other common marketing mistakes.