Owning your own business is a worthy goal. As autonomous humans, the desire to live independently is alluring. I’m a big picture, self-motivating person, who doesn’t do well with micro-management. Working independently makes sense for me and for the people and companies I serve. As a self-employed attorney, I’ve been “killing what I eat” for roughly 15 years now. I’ve also tried a few other ventures and these tips are based upon my personal experiences:
- Be prepared to do it all. You will wear many hats. You are now the tax accountant, the payroll manager, the buyer, the marketing manager, the secretary, the courier… you name it, that is now your hat to wear. A lot of people mistakenly believe owning their own business will provide them with more free time, and frankly the opposite is usually true. You may not need to punch a time clock, but you will often work around the clock, that is if success is your goal.
- Stay away from multi-level marketing (MLM) companies. I know this will ruffle some feathers and it is not intended to. These companies make broad promises of freedom and cash. It’s great marketing on their part. You might pick up a little extra side cash, but your chances of making it big with a MLM are about the same as you winning the lottery.
- Know your market. Who are you marketing your service/product to? Are they male or female or both? What age group will embrace your product? What are the demographics, area, household income, etc.? I once had a friend who decided to do an MLM gig in order to support another friend. The company sold shampoo, among other things. I really wanted to support my friend in this new endeavor. I logged onto the company’s website all ready to order the product. I was stunned. The minimum price was $100… FOR SHAMPOO. I do not spend extravagantly on beauty supplies. Never have, never will. I do not have my nails done and I still buy my make up at the drug store. I would never spend $100 on a product I can buy for $8 at a local store. I wasn’t the right market. And, not making the purchase made me feel like a terrible friend.
- Know your weaknesses. If you are not good at sales you will need to hire someone who is. Sales and marketing skills are an absolute must in any business venture. I’m terrible at sales. I’m more of “if you like it you’ll buy it, if not, that’s cool,” kind of person. I have no desire to impose my will upon anyone else. I have a nephew, however, who is phenomenal at sales. I’d hire him in a heartbeat!
- Be reliable and keep your word. Integrity is important. If you say you open at 9:00 a.m. be there early and be prepared to open at 9:00 a.m. The consumer who showed up at 9:00 a.m. to find the doors locked will rarely come back and give you another chance.
- Read books and understand the value of being a quality leader. Yes, you are the boss but never ask anyone to do something you won’t do yourself. Lead by example not by word.
- Be decisive, be direct, and don’t take it personal. Your job is to get the job done. The buck really does stop with you. Gather the information needed and make the best decision possible based upon that information. Not everyone will like you or the decisions you make and that is perfectly okay. You are the one who has to answer for them in the end. There is a risk/reward ratio you need to clearly understand and be able to employ regularly. What are the risks? What are the rewards? Will the reward outweigh the inherent risk? And, never, never, never, never, never (Did I say NEVER?) sell your integrity, ever. Somethings are not for sale and the reward is NEVER that great. There will be times you may need to walk away from an opportunity (a deal, a venture, a relationship), and it may set you back temporarily, but you will win in the end.
- Do NOT borrow money. I hear this all the time. I’d start a business but I can’t get anyone to loan me the money. This is the worst financial trap ever. Business failures lead to personal bankruptcy more often than not. Don’t finance your business or borrow money for a start-up. Some ideas will work, some won’t. Some things you will like and excel at, and some you won’t. Experience is the greatest teacher. Test the waters before plunking down large sums of hard-earned cash. If you can’t invest your own, why would others want to invest theirs?
- Don’t base the decision to start a business on the support of your family and friends. What do I mean by that? Family and friends are supportive but they won’t pay the bills. I had an attorney once tell me; “No one will use you more than your family and friends.” In their defense, they don’t all mean to. Some do, of course, but not all. Family and friends will often expect free or discounted. However, you’re trying to run a business. Don’t fall into this trap. Never apologize for expecting a fair amount for your time and talents. The word “no” can be very liberating. Also, emotional support does not equate to cash. You’ve heard the saying; “One in the hand is better than two in the bush.” It’s true. No one is truly committed until the money exchanges hands. Thank them for their encouragement and support but never count on them for your success.
- You are the brand. Every time you interact with someone you are marketing your brand. How do you represent what you are selling by being the person you are? WARNING: Politically incorrect anecdote. I have known people who sell weight loss or other health and fitness type products and services, and, well… if you want the buy-in you have to represent that the product works. You are the brand. A few years back I studied and became a nutrition consultant and personal trainer. I looked into the viability of owning a gym. My goal was simple. I wanted to help people regain power over their health. I have a tendency to gravitate towards “helping fields.” The problem was the franchise I was looking at was very popular, in fact, too popular, trendy even. Trends burn bright and die off fast. Don’t waste your money. Also, after a year of study, I understood this company had a limited market and in order to hit a broader market I would have to market past it’s current brand. That is a very tall task. A task I didn’t have the time or desire to accomplish. So I scrapped the plan. It had no long-term viability. I still consult in the areas of health and nutrition, it’s personally rewarding, and for now, that’s all I need it to be.
- Understand the character of your company and reinforce it in every aspect of the company. I’m shocked at how many big businesses still do not understand this concept. Listen, people can buy a product or a service anywhere. Literally, they can buy it ANYWHERE! There is rarely something (product or service) unique to be sold. You have to set yourself a part. The culture, the character of your company, this is something competitors can’t duplicate. Know it. Understand it. Employ it effectively. The desired culture must permeate every aspect of the company. You should be looking for shared core values and relationships.
- Know what sets you a part and market it, market it, market it! I can buy shampoo anywhere. I can buy lipstick just about anywhere. I can get a loan just about anywhere. I can buy trinkets for my house just about anywhere. Heck, I don’t even have to leave the comfort of my recliner and it will be delivered to my door. You must spend time and money on marketing. The places and avenues to reach your market are so varied these days some expertise in this area is imperative. People mistakenly believe they’ll hang out a shingle, open a store or restaurant, and wha-la… Business! It takes a lot of effort to get human beings to walk across that threshold. People are creatures of habit. You must be creative in your efforts to get them through the door, close the deal, and/or sign on the dotted line.
- Know the role of social media. Social media is a great add-on but unless you are truly paying for advertisements your organic growth will be extremely small and slow. A lot of people start a business and then try to market it through their family and friends on social media. We keep hearing what a great avenue these are to market, but it’s simply not true. Sure, you can get a free page but the owners and shareholders of these social media sites aren’t stupid. Your posts are not shared wide and far to your market unless you are paying for the advertisements. And then you have to deal with the trolls (and that is a full article all of its own for another day). People do expect social media for a business, but you can’t rely on it as your sole source of advertising. Also, the people who use twitter are vastly different from those who use Facebook and Pinterest. And those who use LinkedIn are very different than those using Instagram and Snapchat. Then you have the bloggers and vloggers, again, very different. Generic posting to every social media site is not the most productive usage of these sites. The key is in building relationships, conversing, responding, having fun, giving facts, and not just pushing sales. Social media advertising, when done right, is very time-consuming. But, then again, building and maintaining relationships always are.
- Pursue your passion but serve your market. We, myself included, often want to go into business because we have a passion for something particular. Those who love what they do never labor, or so the saying goes. If you buy product you buy for your market, not what you like. That’s a difficult concept for some. The question isn’t; “Do I love it?” The question is; “Will they love it enough to buy it?”
- Never stop learning. Read. Google. Watch YouTube. Watch TedTalks. The internet makes learning available to all. If you want to know about something you can almost always find it on the internet. And, if all else fails watch Shark Tank. Seriously, their panel asks entrepreneurs great probing questions. It will give a very clear idea of what works and what doesn’t.
- Numbers don’t lie. I often ask two questions; “What do the numbers say?” and “What evidence do you have to support what you are saying?” Theories are great. Dreams are wonderful. Ideas are invigorating. Creative pursuits are fun. But, the numbers tell the real story. If it is true there will be evidence to support your position. Data mining in business should not be overlooked. What product or service are they buying? Whose buying it (sex, age, location)? Use this information to tweak your model and advertising goals. The numbers don’t lie.
- Know when to quit. I always test an idea before sinking myself into it. I’m a creative type. I enjoy harnessing an idea and blossoming it into a reality, but I also know my weaknesses. Test the water with your toe before jumping in naked and screaming for help because the water is cold! Starting a business is a big pursuit. Don’t throw good money after bad. Never let your ego or fear of failure get in the way of good economic sense. Learn. Adjust. Try Again. The process of elimination is a great learning tool. We often uncover what works by uncovering what does not.
I love entrepreneurs. I encourage creative spirits. I love those with big dreams and fierce attitudes. This post is not intended to discourage or ever dissuade anyone from taking the next step. The purpose is to share some truths and realties behind the shiny and alluring lights of business ownership. May your business pursuits always lead to gateways of success.