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Small businesses – what do you wish you’d known when you started?

11 Nov
Small businesses – what do you wish you’d known when you started?

I’ve interviewed 105 small business owners since June 2011 when I launched my Small Business Chat Interviews series on this blog. Some of them have just appeared once, two of them (so far) have reached their fifth interview. There’s a lot of info there, and every now and then, I pull out some useful stuff and put it all together in one post. Today, I’m looking at what people wish someone had told them before they started their business.

Of course, as expected, it falls into a few categories. Here they are – all anonymous, some edited down, but thank you to all of my interviewees again for sharing so honestly and openly! I think it’s so interesting that it doesn’t matter whether you’re a maker, a service provider or anything else – these are universal.

Money, tax and cash flow

Expect to spend several times more money and time on marketing than you plan to.

It would take time to develop, so to start with funds were stretched and there were initially a few worrying moments.

Certainly everyone wanting to be a writer should be aware that it is difficult to make a living – the average member of the Society of Authors earns less than five thousand pounds per annum from their writing.

None of your clients will pay on time!

Register for tax self-assessment in plenty of time as you can’t complete the thing before you receive their PIN number through the post, which can take up to a week!

I wish someone would have told me how much I was really worth! Perhaps it came with age, experience and maybe confidence, but I priced myself quite low compared to the rest of the market. On the other hand, I was running the business from my bedroom, so anything I earned went straight into my pocket, and this may have given me a competitive advantage while I got my feet under the table.

Don’t spend money on marketing companies which offer Google front page search results when you can do it yourself!

Not to bother with approaching banks and go for crowd funding right from the offset. The banks I’ve approached did not want to lend at all to me, which made equipment and investment in premises very difficult to fund initially.

That high street banks are not there to help you.

Sort out your prices from the start. Make sure to include everything you’ve used in your costing.

Finding Customers and Networking

That sales are harder than just rolling up and asking for the work! I really wish I’d overcome my reluctance to get out there and network much sooner than I did.

One thing would be don’t waste your money advertising in Yellow Pages and similar companies; networking and going out to meet people is by far the best way to gain new clients, although print directories are rather an old idea now with all the internet sites available.

Where the tree of clients is planted, and directions on how to get to it!

How many prospect clients are prepared to put up with a low quality or average quality of service from their existing provider and sometimes appear to be too lazy to want to make the effort to change to a new supplier.

It’s hard work and always keep in contact with clients and potential clients.

That at least half my time freelancing would be spent finding the next … project.

Don’t rely on just one or two clients. I lost my major client after a few months and, although I was able to replace them fairly quickly, I could have done without the panic!

Don’t put all your eggs in one basket, which I did … because they gave me so much work. When they closed, I was sunk. My other clients had all gone off and found other suppliers. I was really struggling to find childcare and it was all distinctly hairy for a bit.

You can’t set up a business and expect work to fall into your lap. You have to work really hard to get yourself out there and get clients. I knew this, but I was far too timid at first

The importance of contacts and networking.

Branding, marketing and differentiation

I wish someone had told me that by investing in my business I would take it more seriously – which would mean other people would take me more seriously. It was only really when I paid for a professional brand to be created that I began to treat it as a fully fledged business!

The importance of marketing. At the beginning I really expected that I would have clients kicking my door down without any effort on my part. I sat back and expected the business to come to me.

You need to understand two things to succeed – how you are different from all the other folks out there and how that translates into a value proposition for your clients.

The importance of promotion. Promotion is very important if your company and brand is to stand a chance in people’s memory retention when they’re looking for the services you provide.

That you need to work hard to market the business, not just do a few things and hope that lots of business will come your way. The first stages of a business are the most critical, and also where the most amount of marketing and advertising would be of the greatest benefit. Ironically, often new businesses scrimp on the advertising when working out a budget.

To be yourself, and not to be afraid of adopting a unique approach. When you start out its tempting to benchmark yourself with everyone else  and not to stick your head above the parapet in case you make a mistake. In fact, the market – ANY market – wants fresh original ideas and approaches rather than re-hashes of existing products and services, so I think it’s important to make your own mark as quickly as possible.

I wish I had been told to design my business stationery to meet my needs rather than adhering to a ‘normal’ format. For example: I designed my business cards with my name, job title, address, phone number, email and website because that’s what I had on my business card when I was a project manager. However, nobody that I hand these cards to will ever need to write to me. Phone me – yes. Email me – again yes. But write to me? Never.  I wish I’d saved the space I wasted on my address for showing more of the services I offer.

Don’t buy cheap business cards!

Get to grips with marketing – make a list of potential marketing strategies which can be developed as the business evolves.

Confidence, emotions and energy

That I could do it. Like everyone taking that big leap, it can be really scary at first. One year down the line, my confidence is high and the timing seems right for what I have done.

How much more of an emotional rollercoaster it would become.

That sometimes it is really difficult to get your head down and work from home – but that you are not the only one that feels like that.

Running your own business is a rollercoaster of emotions. The good days are so much better but the bad days so much worse because everything matters so much more!

That I could do it, and that I should have faith in myself. (this one is me!)

Have more confidence in yourself – take the plunge and go full-time earlier!

Just how busy I would be.

That nothing goes to plan!!

That there would be good days and bad days but that the excitement of managing your own destiny is worth it.

That it would take some time but I just had to hang in there and things would work out.

That you get out what you put in. Moving to self-employed, I thought it would be all fun and games and a walk in the park. Go to work when I want and leave when I want. This wasn’t the case.

Pace yourself.

Don’t worry. You will be fine!

How much time would need to be invested in networking to make a FB page work…

I wish someone had told me that getting a balance between work and home life is difficult.  I find that so many other businesses are run by people who have another job, that when I want to network online with them, I have to do a lot of it in the evening, meaning that there is a tendency to work all the time!  Had I been told this early on, I might have got the balance right sooner!

You can do this! I wish I had known someone who ran their own business back then, now I know loads of people! Maybe I would’ve taken the plunge sooner.

‘ITS LATER THAN YOU THINK! Sort your life out, you lazy sod!’ I would have liked them to have shouted that to me while shaking me by the lapels. I probably would have cried, but it would have been worth it.

Quite how many hours of my life it would absorb and how unfit I would become, spending so many hours at a computer. There are no nine to five hours involved when somebody wants to book, so it can be difficult to really relax and switch off from work.

Don’t panic, don’t stress!

Not to be as self-critical of what I do.

Keep going. You might think it’s too difficult, and some say it is very hard, but the emotional rewards that come from working for yourself are great.

Freelancing is a pretty slow slog to start off with, but if you keep at it, it does pick up.

That the ebb and flow that you get in business is normal. It takes a while to not panic when things slow down.

That it really is not as scary as you think it will be… quite the opposite – its exhilarating. The fear we build up in our heads, whilst it can feel very real, is really unjustified.  You have to realise and accept that things will not go to plan, and it may feel like it’s going wrong – but that is your opportunity to pick yourself up and find another way.  And every single time this has happened, I’ve always had a better result.

To keep going and remember to take time for yourself. It’s always difficult at first and each time I have progressed, it it has taken a few months to get into a comfortable work/life balance – but it always happens in the end!

That there will never be a right time to launch. It took me a long time to pluck up the courage to make the move, I was always waiting for something to get finished, or something else to fall into place. The perfect time will never come, so if you’re going to do something, you have to just make it happen

Believe in yourself and your abilities! Don’t wait until everything is perfect, just take those first few steps and before you know it things fall into place.

I guess the Guide motto is always useful – be prepared!  – and then be prepared to be surprised.

That this is a 24-hour business, both from the point of view that obviously someone could ring us in the middle of the night to ask about our services, but also more fundamentally that if it’s your own business, you can’t switch off. It even invades your dreams!

You will need to work harder than you ever thought you could. You need to forget about holidays for a few years.

How to know who to trust and when to say no

Be cautious in what you sign up for!

Learn to say no. When I quit my job, I was offered all sorts of opportunities, and as that kind of thing is very flattering, you commit to things that perhaps you shouldn’t. I have narrowed it down to four major projects now and happily they all tie in together.

Everyone has an opinion, they can’t all be right!

Not to trust everyone who offers to help you. Do your research and get to know people first.

No matter how desperate you are for work, if a prospective client makes your teeth itch, just say no. Trust your instincts, because if you engage with that person, you will regret it. I can still be conned occasionally, but I’m a lot better at qualifying customers than I was when I started out.

I wish someone had told me not to listen to the purveyors of doom and gloom. The people who draw breath through their teeth when you tell them you’re setting up a new business in the middle of a recession. This is a great time to set up: bigger companies cannot compete against SMEs on either price or quality of work. Nobody can afford the over-inflated prices of the fat cats and so they look elsewhere. Once you understand this you realise that this is the best time to start up!

From a freelance consultant’s perspective: don’t expect too much loyalty from people you know beforehand.  However positive they seem about you, they may not actually have the decision-making power to give you work!  Imagine starting out knowing ‘0 people’ and ask yourself if you think you can get complete strangers to believe in you.

That it’s OK to negotiate and that you don’t have to accept any rate proposed to you by clients or agencies. A bit of confidence in your skills goes a long way.

To never undersell yourself and realise the value of your time. I started off charging a ridiculously small fee for my work, not really taking into account the time an effort I put into each piece.

That people won’t always be happy for you . I’m a very honest and trusting person, so it shocks and upsets me when people actively try to stop you achieving your goals. I don’t understand it – it’s not in my mentality.

Stand up for yourself. For example, If you’re working for someone who has their own crazily complicated payment plan say, “No, this is how I work, this is how I invoice”, end of story.

Sometimes enough is enough and it’s OK to say no. I have been fortunate in that I’ve always had plenty of work, but that means I tend to work a lot of evenings and weekends. On the whole, I get a lot of satisfaction from doing that, but occasionally I think I could take on a little less work, and have a bit more time off.

That the value lies in the quality of the work I do, not the length of time I’ve ‘officially’ been doing it. I severely undervalued my services in the beginning, assuming that this was necessary to ‘break into the market’. In fact, that caused more problems; potential clients didn’t trust a low-priced service and consequently I had to work much harder for much longer, in terms of finding and securing clients and in terms of hours in for cash out.

Don’t be afraid to turn away clients who aren’t a perfect match.

One of the most important lessons is learning to say “No” to certain projects. When starting out, you are hungry for business and do not want to lose any potential deals, but there are some projects you need to walk away from. It is not worth winning a project at any cost, because you end up spending too much time and don’t make any money, or have clients you can never please. Being willing to walk away has provided me with the freedom to choose who I work with, and now when prospecting for clients, I want to see if the potential client is a fit for my company, as much as they are looking to see if I am a fit for them.

Contracts, legalities and business advice

It sounds cynical, but always get an agreement/contract in place with clients from the start so there is no room for misunderstandings especially when some clients try it on and try to not pay or pay late. Unfortunately there are some people like that out there.

That the customer was not always right! Well, partly due to my fault since I did not have documented ‘Terms and Conditions’ when I started. I had some challenges with customers owing money or not collecting their outfits at agreed times.

Listen to sound good business advice given from reliable sources such a Business Link.  You can’t do everything yourself, so outsource tasks to other people.

I read numerous books and watched endless programmes on other entrepreneurs and I learnt a lot from doing so.

How to price up my items correctly, I have under-quoted for so many jobs!  To have clear terms & conditions and a cancellation policy, I forgot about that bit and ended up out of pocket. ALWAYS take a deposit, even if the job is for a friend!

Knowledge and technology

Make sure you are fully up to speed on the technology side of things.

Make sure you are fully up to speed with the technology. We have to learn as we go.

How to run a business! It sounds so stupid to me now, but when I started I thought that running a business meant money coming in, money going out and paying an accountant once a year to submit my tax return.

I wish I had known how many resources were available to help get me started, such as classes and training, list-serves and discussion groups, online invoicing, etc. I did not need to reinvent so many things—it was all out there but I didn’t know where to look for it.

I wish I could have sat down with real entrepreneurs and just sounded them out before I started in business. I would have liked to have shared their wisdom.

I had really great advice from a successful friend before I started who shared so much of her knowledge. I wish I had listened and constructed a proper business plan, as I left that on the back burner and became a bit chaotic.

[For makers] photography is key. It seems obvious, but it’s really not when you start out.

I had the artistic skills, but I hadn’t appreciated how much time and effort all the other aspects of running a business – admin, marketing and so on – would take up.

I hope this huge wodge of learning points have helped you. If you have others to offer, or you think this article is great and would help other people you know, please add a comment or click the sharing buttons below!

If you’ve enjoyed this article and want to know more about the Small Business Chat interviews, please see more small business chat, the index to all the interviewees, and information on how you can have your business featured (I have a full roster of interviewees now so am only taking on a very few new ones). If you’re considering setting up a new business or have recently done so, why not take a look at my books, all available now, in print and e-book formats, from a variety of sources. 

 
10 Comments

Posted by on November 11, 2015 in Business, Small Business Chat

 

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10 responses to “Small businesses – what do you wish you’d known when you started?

  1. Gillian Linnell

    November 11, 2015 at 9:27 am

    Thanks for this Liz, ive enjoyed re-reading my interviews after such a long time, The business as you say, is still going strong, even though i am now semi – retired, very much part time lol.

    Thanks for all your help in those early days xx

    Gill

    On 11 November 2015 at 09:00, LibroEditing proofreading, editing, transcription, localisati

    Like

     
    • Liz Dexter

      November 11, 2015 at 9:29 am

      Lovely to hear from you and you’re always welcome to rejoin the interview roster if you’d like to, just drop me a line. I’m so glad to hear that the interviews help people – both the interviewees and those who read them.

      Like

       
  2. Rebecca

    November 11, 2015 at 1:33 pm

    What a helpful and thought-provoking list. Thank you.

    Like

     
    • Liz Dexter

      November 11, 2015 at 5:31 pm

      Thank you – I’m glad you’ve found it helpful.

      Like

       
  3. White Ink Limited

    November 12, 2015 at 11:53 pm

    Great post, Liz! I can recognise my contribution and have blogged about the very same topic today!

    Like

     
  4. Bookish with Me

    November 16, 2015 at 9:28 am

    This was a great post! So informative. I am glad to have found your blog!

    Like

     
    • Liz Dexter

      November 16, 2015 at 9:32 am

      Thank you – and good luck with your blog, which seems very new. You might enjoy my book review blog, too, over at http://www.librofulltime.wordpress.com

      Like

       
      • Bookish with Me

        November 16, 2015 at 9:46 am

        Thank you, yes I have just entered the exciting world of blogging as of today! I will be sure to follow you book review blog! Thank you for linking it to me!

        Like

         
  5. beckysamra

    November 22, 2015 at 2:47 pm

    Hi Liz, what a great blog! I met you last week at Loco Lounge in Kings Heath – I am going to start my business up again and this is just what I need and I will be looking into one of your books too!
    It was good talking to you last week and you got me all inspired again, so thank you.

    Becky

    Like

     
    • Liz Dexter

      November 23, 2015 at 7:35 am

      Thank you so much for your comment, Becky – I’m so glad I’ve inspired you again and hope that the posts on here will help you on your way! Best of luck with the business – get in touch when you’re up and running and I’d be happy to include you in my Saturday Business Chat series in the future!

      Like

       

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