Don’t pick a bad company name
Your business needs a name, and it may be the most important decision you make. The name of your business has a tremendous impact on how customers and investors view you, and in today’s small world, it’s a world-wide decision.
Naming a business is a lot like laying the cornerstone of a building. Once it's in place, the entire foundation and structure is aligned to that original stone. If it's off, even just a bit, the rest of the building is off, and the misalignment becomes amplified. So if you have that gnawing sense that choosing a name for your new business is vitally important, you're right.
Start by deciding what you want your name to communicate. It should reinforce the key elements of your business.
Whatever you do, make sure you put thought into picking your company name. And for some reason if you happen to pick a bad company name, stick with it and don’t change it later on. If you happen to change your company name, you will lose the brand value that you have built up over the years. When choosing a business name, keep the following tips in mind:
Easy to pronounce and remember
Forget made-up words and nonsense phrases. Make your business name one that customers can pronounce and remember easily. Skip the acronyms, which mean nothing to most people. When choosing an identity for a company or a product, simple and straightforward are back in style, and cost less to brand. Choose a comforting or familiar name that conjures up pleasant memories so customers respond to your business on an emotional level. Don't pick a name that is long or confusing.
Keep it simple. The shorter in length, the better. Limit it to two syllables. Avoid using hyphens and other special characters. Since certain algorithms and directory listings work alphabetically, pick a name closer to A than Z. These days, it even helps if the name can easily be turned into a verb, like Google me. Choose a name that appeals not only to you but also to the kind of customers you are trying to attract.
Make sure the name is available. This may sound obvious, but a miss here will cost you dearly.Your company name and Internet domain name should probably be the same.
Don’t box yourself in. Avoid picking names that don’t allow your business to move around or add to its product line. This means avoiding geographic locations or product categories to your business name. With these specifics, customers will be confused if you expand your business to different locations or add on to your product line .
Don’t hire a lawyer, hire a law firm
Not only is it important to hire a good lawyer, but you also want to hire a good law firm. Lawyers specialize in different types of law, such as corporate, tax, or litigation. When I hired my first lawyer,he was a one-man show and tried to do everything that I needed. He did a decent job, but he didn’t do a great job because he didn’t specialize in everything I was asking for.
After realizing that my current lawyer wasn’t too good, I decided to contact one of the biggest law firms, thinking that they could solve all my problems. But, I was too small of a client so my work wasn’t given priority, they charged me for every little thing, and the quality of their work sucked.
When looking for a lawyer, don’t just look for a really big law firm; look for a lawyer who will take care of you. Ideally if they work in a decent size law firm, that’s great because someone there will be able to solve your problems.
Hiring is an Investment in Your Business
In many cases, founders who are reluctant to hire even when it’s clear they’re overworked end up kicking themselves later when they realize how much they weren’t getting done while they delayed. Human resources (HR) are a substantial investment for most companies. Having the right numbers of employees with the right mix of skills, abilities, and drive, is critical to the success of any company. Hiring employees can add significantly to your overhead. Moreover, the strategic addition of the right human resources might not show an immediate financial return, but must be cost-effective for eventual financial success.
Evaluating Your HR Needs
Hiring permanent employees is one way to fulfill your HR needs. You can also meet your HR
requirements by:
- Reviewing your work processes (do you need to do it all?)
- Working with contract freelancers for temporary and/or skill-specific projects
- Hiring temporary worker(s)
If you determine that a permanent employee is the right decision for your business, you’ll need to:
1. Determine who you need. The better you understand the position for which
you’ll be interviewing, the better you’ll be able to evaluate applications and
choose the best candidates.
2. Create job descriptions and expectations. Not only will these two tools help
you evaluate potential candidates, potential hires will have the information they
need to make informed employment decisions. It’s important that both the
employer and candidates clearly understand the position and expectations.
Otherwise, you might be faced with having hired an employee who isn’t suitable
to your position.
Hire for Potential, Not (Just) Track Record
The ability to see potential, not just evidence of past success is key in hiring. Look for someone who has a strong interest or passion for causes or missions that are similar to yours, and, separately, evidence that the person is really good at what he or she has done before (even if that’s a variety of different things). Unlocking potential has to do with marrying someone’s skills and passions, so even if a person hasn’t yet found a way to truly unleash herself, if your position can do it for her, you’ll likely see results.
Hiring doesn’t solve all of your problems
1. Just because someone did really well in their last job, it doesn’t mean they are going to do well in your company. For example, if they were a rock star sales person that worked for your competitor, it doesn’t mean they will be a rock star sales person for your company.
2. If you want to increase your sales, try to do it yourself before you hire someone. Yes in the long run you should hire employees if you want to grow your business, but if you don’t know what problems these employees will run in to, you will have a tough time managing them.
3. There are a lot more costs to an employee other than their salary. Office space,insurance, computers, and other expenses add up. The biggest of those expenses are probably management expenses to manage your employees.
4. Having virtual employees sounds great at first, but some people aren’t too efficient when they are virtual. If you have any virtual employees consider using efficiency tracking solutions like Rescue Time to see how your employees spend their time.
5. Hire someone as soon as you know that you need them and can afford them, even if it’s tight at first. The extra oomph that another person gives in brainpower,creativity, and sheer legwork is totally worth it. Things that would otherwise take you weeks will be doable in days. Entire work streams will disappear from your to-do list .
Have a business partner
When you have to make all the decisions in your company by yourself, you are more likely to make mistakes. Although I had a business partner with my first business, he wasn’t active so I had to make all of the decisions myself.The cool part about having a good business partner is that they can bring something to the table thatyou don’t have it helps your business to get:
Twice as Much Manpower
When you work with a business partner, you can do twice as much work. A lot of work goes into building a business. You need to do marketing research, networking, research and development, sales pitches, and meet with potential lenders or investors. All of this can overwhelm a business owner. In the early stages of a new venture, you may not have the resources to hire employees to assist you.Thus, you may need a partner you can trust to share the burdens of starting a new business.
Diversity in Skills
A business partner may bring an entirely new skill set to the table. One business partner may have a background in engineering and research, while the other excels at sales and networking. Taking advantage of utilizing the differing skill sets can help the business succeed. In addition, working with a business partner allows you to divide up tasks according to strengths, conserving time and eliminating duplication of efforts.
Different Perspectives
Business owners need an outside perspective to avoid tunnel vision. You might think that you have the best idea or solution to a problem, and readily invest capital into your business plans. Successful entrepreneurs have faith in their ideas, but may need someone else to put things in perspective. The decision-making process becomes easier and more realistic when two or more people objectively evaluate ideas and share their concerns and feedback.
Someone to Hold You Accountable
Some people become lackadaisical when they begin a business. They may have a hard time
maintaining the discipline needed to stay motivated. Partners keep each other on the ball, and hold each other accountable for any mistakes.
Someone to Evaluate Ideas
Business partners talk to each other about their ideas. Many entrepreneurs have trouble maintaining objectivity when initiating a new business idea. A business partner helps you realistically evaluate new ideas and business plans for potential flaws. Your business partner can also build off your ideas,offering more input to refine your plan, so you have a better chance of succeeding.
Ability to Keeps Things in Perspective
Entrepreneurs often ride a roller coaster of emotions. Sometimes they become too pessimistic and other times they feel overconfident. Pessimism and too much confidence can both hinder a new business plan. A partner can help you keep everything in perspective and not get distracted by fluctuating emotions. It is never an easy thing to find a great business partner, so don’t rush it. Make sure you get to know the person before you go into business with them. You should also expect to get into arguments and heated discussions, so you better be prepared to deal with him or her.
Don’t be afraid of the unknown
Advice Monkey didn’t accept payments online because I didn’t know how to and I was afraid of all the problems that it could cause. I know that sounds stupid, but as a 16 year old and I didn’t know better.My fear of accepting payments online was one of the biggest reasons my business failed. Instead of being afraid of it, I should have done research on accepting credit card payments and the implications of charge backs.If you are afraid of something that you aren’t too familiar with, suck it up and deal with it. The worse that can happen is that you’ll stumble along the way.
To get you ready to start your first business. And you know what? You’re going to love every minute of it! Let’s dive right in.
Step 1: Do Your Research
Here’s where you really get to have fun. Why? Think of doing research like when you go to Costco -- you get to sample all those tasty foods and see what you like best. So, get out there and start to “sample” different businesses.In other words, you should already have an idea for a business, along with a product or service, and all you need to do now is find out what other successful businesses are doing. Once you have “sampled” all of them, it’s your time to come up with a better way to do what they’re doing. Take good notes, and write down everything that comes to mind because it will prove useful as you write your business plan
Step 2: The Business Plan
Think of Christopher Columbus.Do you think he stocked up his ship, got funding from the monarch,and rounded up a crew without some sort of plan? No. He certainly had a plan. And though he set out to find a westward route to asia by sea and found the Americas, the important thing is that he started with a plan. Similarly, think of your business plan as your map to a new world -- and if you end up in a different spot than you anticipated, it’s okay, so long as it’s successful. Make sure your business plan goes through scenarios of finance, HR , unexpected hurdles,federal compliance, etc. Your business plan should be anywhere from 20 to 50 pages.
Step 3: Choose a Location
You know what they say, “location, location, location!” Right? Actually, nowadays, location isn’t everything. It’s a combination of location and your ability to get found through social media and the web. However, if you’re not so fond of social media and the internet in general, location is your fighting chance. But remember, I don’t recommend this as the world will expect to find you online, rather than driving down the street. Knowing this, choose a location that is perfect for what you’re going to do. There’s no need to find a building or space that is over the top. Simply find something to go with what you do something you can grow into and not out of in the first few years.
Step 4: Fundraising and Financing
You have a plan, location, and determination, what’s next? The part you may not feel so comfortable with -- but that’s what I’m here for. You’re going to have to step out of your comfort zone and do a couple things. First, come up with a killer presentation of your business, and second, ask for money.So, get your excited, energetic, outgoing personality on and set up a few appointment to present to potential investors for your new small business. You may start with family and friends who believe in your business.
Step 5: Register and Get Licenses
I cannot stress how important this step is. Your state and local city government will have various regulations you much follow -- get to know them very well. Start by registering your business name with the state and what type of business you’re going to be (i.e. LLC,Inc, etc.), then go to your city office and find out what other regulations you must adhere to in order to be compliant. Different types of businesses require different licenses, so make sure you’ve done your research here because you don’t want to be caught red-handed without an important license. Also important is getting your EIN (employee identification number) or tax identification number from the IRS and your state revenue agency. You’ll need this number in order to do taxes and can’t open without it. If you do open without it, you’ll get a nasty letter in the mail -- you don’t want that. Also, don’t forget to register for workers’ compensation, unemployment, and disability insurance.
Step 6: Deciding Benefits
Before you hire your team, check out health benefit options (i.e., a Health Reimbursement Plan or group health insurance) and decide what you want to offer. Why? If you offer amazing health benefits,you can recruit the best employees and keep them around a long time. Offer affordable health benefits that save money for both you and your employees.
Step 7: Hiring
You’ve gone through the thick of starting your business and now it’s time for the exciting part, hiring your first employee. But, don’t forget, while hiring is absolutely exciting and fun,you do need to follow certain legal steps as you hire.In order to hire, you’ll need to decide now what kind of employees you want. Are you going to take anyone that applies, or do you want to find the employees yourself? Whatever the case may be, just remember these are going to be your team, your blood. Your small business’s success will fall on the employees you hire: whether that’s one, two, or five employees it doesn’t matter. Choose wisely, but have fun with it.
Step 8: Marketing
You know how we talked about location and how it’s not everything? That’s where your marketing will come in. So, if you really want to be successful, remember this: marketing is your number one tool to find new customers and for them to find you. Don’t forget this, okay? Now that I’ve got that cleared up and we see eye to eye on it, I want to mention a couple ways you can successfully market your new small business. They are:
Blogging - Blogging is a huge tool for you. If you’re writing even one to two posts a week which address your customers’ concerns and provide them with solutions, along with showing them how and why your business is that solution, you’ll see a lot of new customers will find you. Never underestimate the power of blogging.
Social Media - You’ve got to admit, social media has not just been on the rise in the past five years, it has completely, single-handedly taken over the world as we know it. What does that mean for your and your new small business? Jump on the bandwagon. Use social media often to advertise,promote, and keep up with your beloved customers.
Step 9: Fight ‘til the Bitter End
Listen, I’ll be straightforward with you. Eight out of ten businesses fail. But, I am here to tell you that if you follow these steps religiously, as well as never take no for an answer, you’re not going to be part of the 80 percent that fail. Think of it this way, some of the largest corporations out there started out exactly where you are right now. They looked up how to start a business, and they did it. The difference between a small business that fails and one that succeeds is the determination of the owner. If you’re determined, humble, and care deeply about what you’re doing, there’s no reason for you to fail. You’ll have days you aren’t sure what to do, but what matters is that you press on and never give up. That, my friend, is the secret to your success.
The first thing you have to do is change your mindset. You have to start viewing your skills and experiences as money making resources.
You have to stop underestimating your ability to help someone with what you can provide — whether that’s information, a service or a physical product. When you’re first getting started making money on your own, the best way to get started quickly is to understand the different ways you can make money, and which one will work best for you.
Generally speaking, there are 3 ways to make money:1. Providing a service to someone
2. Providing information (really a subset of services)
3. Selling a product
All 3 of these can be very lucrative — it just depends on what type of business you’re most comfortable with, and what type of work you want to do.
There’s nothing more important to the growth of a service company than the quality of the people that you bring on board. But while it’s a good idea to hire people who are technically great at what they do, that shouldn’t be your number one priority:
“Over my years in business, I have had a saying when it comes to hiring: Hire character and train skills. Everything worth doing is done on a foundation of integrity and honor.” -Ross Perot, Founder of EDS
Integrity, honor, reliability, work ethic, adaptability, passion, and the desire to learn cannot be taught.
We learned that working for yourself was a great way to improve one’s lifestyle.
No surprise then that we now own a few businesses of our own. But we made lots of mistakes getting started, mistakes we could’ve avoided if we had known a few things.
Here are seventeen mistakes that you should avoid:
Sell Something Legal
Selling something legal may sound obvious to anyone in business, but the truth is, when it comes to wanting to make money you will likely consider a lot of ideas… some legal, some illegal and some in between.
You don’t want to make a lot of money and then lose it all because you are on the wrong side of the law.
You Must Market Your Product to Succeed
If people don’t know about your great product, then they can’t buy your great product. It’s that simple.
Marketing Keys to Succeed in Any Business
There are three things you need to be successful in marketing any business, whether online or off. Do you have the ingredients you need to succeed? The key ingredients are:
- A Good Product
- A Marketing Mentality
- Money for Advertising.
A Good Product
You can't succeed without a good product. If you are in business, you want to provide your customers with a quality product or service. If you have a good product, there are four ways to position your business for success:
* Have a Niche Product: create something that nobody else has or provide a service that no one else is providing. If people need the product and your business is one of the few in the country that provides it, you can almost be guaranteed a national market for your goods or services. (Then the Web is the natural place to promote your company.)
* Have the Best Product in Your Industry: some people will always be willing to pay a premium price for the best product. That is why some people buy a Mercedes rather than a Chevy. If you have the best product or highest quality service, you can charge more, but your market is usually smaller and your clientele more select. If you have the best, don't compete on price - compete on quality and perceived value.
* Have a Good Value: if you don't have a niche product or the best product in the industry, you can still build up a large market for your company by providing a good value for your customers. MacDonald's doesn't make the best hamburger in the world, but it does make a good hamburger at a low price, and the company is almost in every industrialized country in the world.
* Give a Value Added Service: a VAR is a corollary of the last two. If you have a service you give to your clients that helps them build a better business, the clients will be willing to pay more for your product because of the relationship you build with them over time. For example, if you sell diagnostic equipment to a car dealership but you also offer training on the new equipment to the dealer's employees, the dealer will be willing to pay you a bit more for your product and will choose you as a supplier over someone who just sells the product and gives no service. Your training clinics are a valuable service that the dealer cannot get from another supplier. You may actually save them money, because it would cost the dealer more to send the employees out of state to get the training.
A Marketing Mentality
Be warned! A good product is not enough! Good companies with good products fail every day. One of the most common reasons businesses fail is a lack of advertising. If no one knows about your product, nobody will buy it. It's as simple as that. Most marketing gurus will tell you that your advertising budget should be between 15% and 20% of your total budget. That percentage may be greater if you are just starting a new company or introducing a major new product. Many small business owners are afraid to spend money on advertising; hoping word of mouth will make their business succeed. Such thinking is a fatal mistake for many businesses.
* If you are afraid to spend money on advertising, you don't have what it takes to succeed in business. Period. The web will not help you. Fear is ruling your future and you don't have the confidence to take the necessary risks to succeed. All businesses ventures require risk and a certain amount of faith: faith in your product, faith in your ability, faith in the future, perhaps even faith in the fairness of the marketplace. Without that faith and a willingness to take a risk for the sake of future profits, you lack an essential ingredient to make it in business.
* You need to see advertising as an investment not as a cost. When looking at your potential returns and future sales, you must see advertising as a way of increasing your product sales. If a billboard advertising campaign will cost you $10,000 this year and you can only see how much money you will be spending, you don't have a marketing mentality. A true businessperson looks at the potential return on his or her investment in advertising. For example, if your average product sale to the customer is $10,000 and the product costs you $5,000, you need only 2 sales from your billboard campaign to break even on your advertising expenses. Just 3 sales means you've made more money than you've spent. If an average billboard campaign will bring you 10 sales, why are you looking at the $10,000 it will cost you instead of the $40,000 you will earn?
Perhaps you should be spending $100,000 on your billboard campaign. Again, if you don't see advertising as a means of generating revenues, then you lack what you need to succeed in business.
* You need to have a long-term vision for advertising. You need to understand how advertising works. It takes 21 impressions on radio, television, and combined media to cause your business, product, name and contact information to be remembered by the consumer. If you spend $1000 on 15 prime radio spots, don't expect any sales. If you do get some, you're unusual. Most likely, the customer won't even remember your business name by next week. Repetition is the key to learning and remembering. Repetition is the key to advertising. Many business owners are disappointed when they don't see an immediate increase in business with an advertising campaign. They expect the phone calls to start pouring in. Such expectations are unrealistic. What actually happens is this: the more frequently the consumer hears your name, the more familiar you become and the more comfortable they become with you. If, for example, you sell tires, the consumer may not need tires the week they hear the ad. But after hearing your name regularly for a month or two, when it comes time to buy new tires, your name is going to pop into their head, and then they will give you a call. That is an example of how advertising really works. So you can see that if you don't have a long-term vision, you lack what you need to succeed in business.
Money for Advertising
I'm sorry to say it, but even if you have a good product, and you have a marketing mentality, but you lack sufficient capital to promote your business, you lack an essential ingredient for business success.
Many businesses fail because they are undercapitalized. They start out with a good business idea, but they lack the money to make it work. They spend all their resources on plant, rent, equipment and raw materials, but they have no budget for advertising, and so they have no way of letting the public know about their product. Such businesses usually fail within three years, or they crawl along just barely making ends meet, if they survive at all. You can succeed if you only have the first two ingredients, but having money for advertising sure makes everything a lot easier. So, the question I have for you is this: "Have you budgeted your business for success?"
Why the Web?
A web presence should be one of the essential items in your overall business plan for advertising and for sales. Just as you need a sales force, regional advertising in radio, television, and print media, the Web should be one more avenue for advertising and generating business. It is part of your strategy and part of your plan. In fact, studies show that the Internet address is replacing the phone book as the place that young adults turn to for business and consumer information. If you aren't on the Web, it's like not being in the phone book. If you aren't there, people can't find you. Internet commerce and web procurement are the wave of the business future. You need to make plans for this future, or you will be left behind.
The marketing mix is made up of the following elements, often referred to as “the four Ps”:
- Product (or service)
- Place (location and distribution)
- Price
- Promotion
For a business to succeed, you need to:
- get all of the elements right
- strike a balance between the elements
Differentiation of your business from your competitors can be achieved through adjusting the elements to make your product/business more attractive. For example, if you wanted to market a high profile brand, you would focus on promotion rather than price.
Promotion
Promotion is about effectively communicating with your customers so that they are encouraged to buy from you. You need to promote to both existing customers and prospective ones, which may involve promoting to each in different ways.
To promote successfully, you need to take the following into account:
- You need to know as much as possible about your customers and their buying habits.
- You need to identify which are the important questions customers could have about your product/service, eg is this a reliable product? Your promotional
activities should answer these questions.
- You need to identify your unique selling point (USP) and communicate it effectively to your customers.
- You need to identify the style of your promotional activities
- You need to decide when you are going to promote.
When you have answers to the above, you are in a stronger position to decide what to say, how to say it, when to say it, and which promotional method(s) to use.
Promotions Mix
The ‘promotions mix’ is the combination of promotional elements you use to promote your
product/service.
The various elements which can make up the promotions mix include:
- Personal Selling
- Sales Promotion
- Public Relations
- Direct Mail
- Trade Fairs and Exhibitions
- Advertising
- Sponsorship
You would choose the appropriate elements for your product/service and integrate them to form a promotional campaign.
Make Payments Easy
The lesson I learned from Advice Monkey was that if you wanted to make money you needed to make it simple for people to pay you. Of course you have to provide a valuable product, something people want or need, but if you don’t make it easy for them to pay you, you’re business will suffer and eventually fail. I’ve learned that whether you are providing a service like consulting or a product like software, you should provide the simplest, most common and fastest way for people to pay.
If you make it hard then you are simply giving people an excuse to delay paying you or even giving them an excuse to go to your competitor who does make it easy. Don’t do that because it could be a million dollar mistake.
Focus
One of the reasons Steve Jobs and Apple were so successful was they focused. They didn’t have a bunch of products, even though you might think they did. They had only a handful.
That allowed them to do several things very well:
- They could listen closely to what their customers were saying.
- They could create the products to meet the needs and desires of those customers.
- They could make those products the best in their category.
If you are not focused you will not be able to do a good job on your business. Find the things in your business that make you the most money and focus on them. Eliminate everything else!
Other Keys to Succeed In Any Business
- Solve Problems Customers Are Facing
- Do It in a Simple Way
- Be Patient
- Charge More
- Conserve Cash
- Never Stop Closing
- Always Find Your Passion
- Learn, Learn and Learn Some More
- Good Help Costs Money
- Emotions Rule
