In the last post, I spoke about the characteristics of a successful entrepreneur. I also mentioned that skills can be learned or outsourced. Several ingredients in our recipe for business success are skills necessary to succeed. We also need to understand the correct portions. When you hear “budgeting”, the first thing that comes to mind are the finances but you also need to budget time. Our pantry has precious little time so it is essential to buy/borrow time (outsource) or reduce the recipe for the first batch.
So which skills do you outsource and what if you don’t have the money to pay for those skills? This is your first PFO (Potential Fail Opportunity). You will have several PFO’s throughout your business life and the more you successfully navigate, the smaller they become. Those who fail give up, make the wrong decision, or slow down by over-analyzing. You will have precious little of your time and making sure you work the tasks where you add the most value is essential. So if you don’t have the time or necessary skills and don’t have money to outsource, what are your options? Here are just a few ideas:
- Enlist friends and family members to teach you or to handle temporarily
- Reduce the complexity and scale down your business until you can get the necessary revenue
- Trade the skills for your product and/or services
Some of the skills we are talking about include:
- Legal – Setting up the business, drawing up partnership agreements, drafting contracts, etc.
- Design work – Logo design, brochure graphic design, business card design, etc.
- Accounting / finance – Setting up your chart of accounts, developing your monthly and quarterly reports, filing the necessary tax forms / paying taxes, etc.
- Web development – Designing, building and maintaining your web site. Search engine optimization (SEO). Posting blogs, responding to questions & feedback. Reputation management.
- Marketing – Promoting the business through networking, trade shows, social media, videos, print media, etc.
- Start as a Sole Proprietorship as long as the legal liability is low. A Sole Proprietorship is simply running the business under your name or a name you register with your county. Registering a business name with the county is typically done through the county clerk’s office and is called an “Assumed Name Certificate” or “Doing Business As (DBA)”. You file your federal income tax as part of your personal tax return including a Schedule C (Profit & Loss) among other additions.
- Spend some time coming up with a company name, logo, and domain name. This is how customers will recognize you when you become successful. It should be short, simple, and catch the eye. This might be the place to spend some money to get it right. There are companies that specialize in this type of design work.
- For accounting, start simple. It could be as simple as a spreadsheet or possibly Quicken. Once you begin to grow the business, you can invest in Quick Books and an accountant who can set it up correctly. If you don’t understand accounting, chart of accounts, and Quick Books, do not attempt to set it up yourself. You’ll regret it later!
- Web development can be done using one of the do-it-yourself services. Key thing is having your domain name reserved early. Any number of sites offer package deals when you buy the domain name from them. Just be very careful as most of them have a series of questions they ask as you register and most of them are upselling optional features that you will pay for monthly or annually. So that $2.95 web site could end up costing you $100s. These packages often include a basic web development tool that would likely meet your needs for the early months of your business. Another option is to start your business on a 3rd party eCommerce site like Etsy.com.
- Marketing is the bread and butter of your business. Most new entrepreneurs think it is a simple matter of posting a sign, staffing a trade show booth and/or putting up a web page. The fact is you will EARN customers one at a time. It will require a lot of slammed doors, rejected emails, hang-up phone calls, and experimenting to find the right combination of costs to customers obtained. The absolute cheapest and most effective advertising is word of mouth. Treat your customers like gold and leave them wanting to go tell 10 friends about your business. We will discuss marketing in much more detail in upcoming posts.
The recipe for business success is a few necessary characteristics like work ethic and leadership with a dash of skills like marketing and financial accounting mixed together with a heavy dose of time. Bon Appetit!