Ask any entrepreneur and they’ll tell you that successful businesses are based on strong relationships. Some are built one relationship at a time. But scaling a company takes a lot more than LinkedIn endorsements. It’s about taking the time to build relationships with the people you work with — customers, vendors and mentors — so that as your company grows, you’re well suited to grow your network with it.
# I know a guy who knows a guy
Unsurprisingly, your existing community of supporters can be a great resource for a new business. Moral support and word of mouth are incredibly valuable, but you might be surprised by the ways in which your existing network can lead to a big breakthrough.
The idea for Tuggo toys struck as my family watched our dogs excitedly try to play with a bowling ball. In true bootstrapped fashion, my parents’ basement was my first workshop. Once the neighbors noticed my two boxers, Harley and Hailey, playing with prototypes in the yard, I shared the story with anyone who seemed interested. When it came time to find a facility to build our products, my friend’s next door neighbor had just moved back from a job in China’s plastic industry and he helped us find the perfect production partner.
# Look for learning opportunities
Some of the best entrepreneurial advice I’ve received is to see everything as a learning opportunity. While it’s incredibly important to learn from your own mistakes, learning from other people’s mistakes may save you a few bumps and bruises. Seek out advice and find a mentor, either online or in your community.
At the end of the day, no matter how different their industries may be, most businesses share the same goal: success. I grew my network and found much-needed guidance by joining the Nashville Entrepreneur Center and an organization called Vistage, which connects CEOs to network and brainstorm. You can learn a lot about building and running a business by talking to other small business owners. I invested in branding materials and hit the road for trade shows on the recommendation of a more seasoned entrepreneur and my company’s growth exploded as a result.
# Take trade shows seriously
Trade shows can be stressful, but you can get a lot out of them. They may not all be glamorous, but shows provide a unique opportunity to quickly forge countless relationships with a very targeted audience. Even smaller events offer the chance to meet new customers, contacts or vendors; it’s just a matter of finding the right events to attend in your industry. Much like most networking, you get back what you put into a trade show. Learn from informative sessions, scope out partners and competition on the show floor and appeal to individual and corporate buyers once you start setting up booths of your own.
We took 500 early, handmade sample Tuggo toys to a pet expo in Nashville. At this point we were running a tube through plastic balls and melting them to form a seal. When we sold out, I knew we had a good idea on our hands. After establishing our production line, we filled bigger orders at larger shows. We were invited to compete for PetSmart’s Innovation Station awards after selling out at a big show in Las Vegas. The outcome? Our toys are on shelves across the country.
# Bring on help to build your brand
While it’s particularly important to catch people’s attention and make a strong first impression at trade shows, it’s a widely applicable lesson. Effective branding and marketing are a must-have for any growing business. Unless you’re a trained marketer and/or graphic designer, you should invest in strategic counsel and professional design services for a logo, business card, website, packaging and any collateral design. You can do all this without breaking the bank, too.
“Good old fashioned” networking is great, but the best part of a global economy is the ability to work with people you may never meet, around town or across the globe. I work with a distributed team of partners I trust, but haven’t met them all face-to-face because I found them online. My marketing consultant lives nearby and we meet up to plan campaigns, but I found a freelance graphic designer that I can afford and love working with on Fiverr. He and I have been working closely together since I started the company — he made my logo and now knows exactly what I want as I start describing a new flyer or banner graphic. Just like a face-to-face relationship, it’s one built on mutual trust and admiration. I even sent him a new computer a few months ago as a thank you. I’m also working with content writers across the country to build up a blog next. It’s a lot easier to find help on a budget now that anyone, anywhere can sell their skills online to build a business of their own. Expand your network and use it to your mutual advantage.
# Create an edge through personalization
If you invest the time and energy required to build lasting relationships for the backend of your business, it should be intuitive to build similarly strong relationships with your customers. It doesn’t matter if you have a one-man selling operation or a full-fledged team, there should be a strategy in place that centers around getting to know customers. Adopting new tools can make it easier, too. My team uses Zoho for customer relationship management, but there are plenty of great CRM solutions on the market for solving the same problem. Your software choice isn’t nearly as important as the way you use it though.
We sell dog toys. What that means is that our customers aren’t exactly our users. We recognize that reality in our communication and our collateral, and it pays off. We don’t just get to know our customers, we get to know their dogs too. We take the pets’ names and breeds down with all our other notes so we can ask how Zeus, the in-house terrier at Pets on Main, is enjoying the test kit of toys we sent when we follow-up. A professional but personable approach and personal touches go a long way to build trust with new and potential buyers.
If you want to see your business grow, go out and introduce people to it. Building a broader network is the best-tested, most cost-effective solution to almost all of the challenges associated with scaling a company.
What do you need to do to start a business? There are dozens of sites on the web including ours that have checklists that remind you of the many tasks you should perform to start a business. While such checklists will help you remember a lot of important steps you might otherwise overlook, they are rather impersonal To Do lists. They won’t make or break your success.
What will make or break your business? Here are important guidelines for turning your business idea into a successful business.
# Know yourself, your true motivational level, the amount of money you can risk, and what you’re willing to do to be successful. Sure, we all want to make millions of dollars. But what are you willing to give up to reach that goal? How many hours a week will you work on an ongoing basis? How far out of your comfort zone are you willing to stretch? How far will your family stretch with you? To be successful, keep your business plans in line with your personal and family goals and resources.
# Choose the right business for you. The old formula – find a need and fill it – still works. It will always work. The key to success is finding needs that you can fill, that you want to fill, and that will produce enough income to build a profitable business.
# Be sure there really is a market for what you want to sell. One of the biggest mistakes startups make is to assume a lot of people will want to buy a particular product or service, because the business owner likes the ideas or knows one or two people who want the product or service. To minimize your risk for loss, never assume there is a market. Research the idea. Talk to real potential prospects (who aren’t family and friends) to find out if what you want to sell is something they’d be interested in buying, and if so, what they’d pay for the product or service.
# Start on a small scale before going all out. Some people believe that entrepreneurs are risk-takers. But for the most part, successful entrepreneurs don’t like walking blindfolded on a limb. Instead, they take controlled risks. They test an idea on a small scale, then build on what works well, tweak what shows promise and discard the disasters.
# Don’t fixate on mistakes or get demoralized by them. The difference between successful people and everyone else is that the successful people learn from their mistakes and move on. They don’t dwell on failure, blame the economy, curse their bad luck, or blame other people for their fate. If the path to their goal is blocked, they look for an alternate path, or sometimes choose a different, more attainable goal.
# Learn from others. Find mentors, join groups with like-minded people, learn everything you can about your industry and what it takes to get from where you are to where you want to be.
Attend industry conferences. Take training courses when they are available. Buy courses offered by experts. You’ll save a tremendous amount of trial and error by learning from people who have been there before.
# Plan to succeed. If you’re not seeking investors or putting a huge sum of money into your business, you may not need an elaborate business plan, but you still do need a plan – one that specifies your goal – your destination – and then lays out at least a skeletal roadmap for how you’ll get to where you want to go. The plan will change as you progress and learn more about your customers and competition, but it will still help you stay focused and headed in the right directions. Use our business planning worksheet to help develop that basic plan.
# Don’t procrastinate. I’ve heard some people advise would-be business owners to not move ahead with their business until they have investigated every last detail of the business they want to start, and are absolutely sure it’s all going to work and be profitable. The problem with that approach is that it leads to procrastination. No one ever really has all the pieces in place – even after they’ve started their business. Yes, you need to research the market, have a rudimentary plan in place and do things like get a tax id if needed, register with local officials, if required, etc. But if you try to make everything perfect before you launch, you may never get around to starting the business at all.
# Think of what you do AS a business. Keep track of income and expenses, keep business money separate from personal funds, find out what regulations your business needs to abide by.
# Understand the difference between working for yourself and building an ongoing business. If you want to build a business, you need to develop systems and methods that allow you to hire other people to DO the work of the business while you plan it. You limit the potential for growth if you don’t bring in other people to work for you.
# If the business you are starting will need investors to grow, do what you can to find out what investors are looking for and where to find those who might invest in your kind of business. Local angel and venture capital groups are a good place to start – attend meeting they hold or meetings that investors are speaking at.
# Put yourself out there. Ask for what you want (in a polite way.) I started my online business by participating online on GE’s GEnie online service. When I was ready to send them a proposal to run a small business area, I could not only talk about my credentials in general, but point to places I was already contributing to their service. I became one of the early content providers to America Online because I picked up the phone and made a cold call. I wound up with a new consulting client after I struck up a conversation with a woman sitting next to me on an airplane. Remember, people like to do business with people they know. Get the ball rolling, and keep it rolling by continually reaching out and introducing yourself to new people.
# Never stop learning and trying new things. What’s profitable now, won’t necessary be profitable next year or 10 years from now. So, don’t let yourself fall into the “this is the way I’ve always done things” rut. Keep your eyes and ears open for new things. Are there newer or better ways to market your products and services? Are customers asking for something you’re not offering? Is there a different type of customer you should be targeting? Get answers by reading everything you can about your industry and listening to your customers.
One of the biggest struggles I had in starting my business was actually coming up with the idea. I wanted something that was scalable as well as needed in our society. I combed through hundreds of ideas before settling on my current venture. Through this discovery period, I uncovered what I believe are the five most important concepts in determining what makes the perfect business idea.
So, what is a perfect idea? Each individual entrepreneur has their concept of the perfect business. While Google is a great business for the founders of that company – it may not be a great business for others that are non-tech savvy or who do not want to run such a large organization.
Therefore, each perfect business is defined by the business owners. Keeping this in mind, let’s start on my five concepts of finding the perfect business:
# Understanding your customer
This might seem strange to start here as how do you know your customers before you have a business idea in place. The answer is simple – your customers make the business, therefore without customers there is no business. If you have a business idea don’t try to develop the idea around what YOU think potential customers will like or need, but find out what your customers actually desire. Too often business owners get an idea in their head and jump right in with both feet. However, they soon find out that their target market does not want what they are offering. Spending both time and money on a project just to see it languish is not the perfect business idea.
Moreover, let’s say you don’t already have an idea – getting out and understand consumers (those who will eventually become your customers) may lead you to the perfect idea. Knowing what potential consumers need and building products to meets those needs will get customers beating a path to your door – that is a perfect business idea.
Passion here does not mean being fanatical about your product or service. But, it does mean having some interest in what you do. More times than not, you will be spending 15 to 18 hours a day working on your business in the beginning – usually for the first 12 to 18 months (more like 2 years in this economy). You have to constantly be thinking about ways to improve and grow your business as well as be out talking about it to everyone, everywhere. If you end up starting a venture that you don’t have passion for, something that does not make you jump out of bed each morning, it will be very hard to put in the hours and energy to make it successful – thus not a perfect business idea.
# Understand Your Competition
Every business has competition – either direct or indirect. Think about movie theaters. They have direct competition from video rental stores or at home television. They also have indirect competition from any other activity that consumers spend their disposable income on like bowling, paint ball, golf, etc. Anything that people do in their spare time.
Further, some competitors are ruthless. Meaning that if you promote and offer a product that is similar to theirs but at a lower price, these competitors will just lower their price to match or beat you. If they are already established businesses – they may be able to undercut your price enough to drive you out of business.
If you don’t know your competition – what they are willing to do to keep you out of their market – you may be spending more of your time in a pricing war then growing your business – not the perfect business idea.
# Cash Flow
Lots of entrepreneurs enter the business world with great ideas but very poor understanding of the capital it will take to get their venture off the ground. Most will prototype their product or service and understand what it takes to make the product or provide the service but they don’t understand the capital it takes to manage the rest of the organization – including marketing (very expensive but extremely necessary), employees (more than just salaries or wages), insurance or supplies and all the little miscellaneous expenses that add up very quickly like phone, internet, computer services, etc. Knowing your total cash flow will help ensure that all of your costs (variable and fixed) can be covered by the business – the perfect business idea. I have seen way too many businesses with great products fail because they could not cover simple expenses like rent or utilities.
Know who you are. Know your strengths and weaknesses. Know that you are ready, willing and able to do what it takes to make your venture a success. I have worked with many business owners in the past that think all they have to do is hang out their shingle and they have it made. Thus, when it comes down to actually running the business day-to-day – they are unwilling to invest the time, energy or money necessary for success. Thus, know how hard you are willing to work.
Moreover, know your personal financial situation and what you need the business to generate to cover your lifestyle. If you think your business will pay you a great salary from day one – it will not. And, if you need it to, it is not the perfect business idea for you. Take away outside distractions like your personal financial situation – get those in order – thus, when your business concept does materialize – you will be able to solely focus on its conception and growth. In the end providing you the financial security you are seeking – it will be the perfect business idea.
Regardless of the level of your desire for your business – a lifestyle mom and pop operation or a multi-national conglomerate – if you develop a business idea with these five concepts in mind – your idea will be the perfect business idea for you.
Every small business owner wants to make more sales. But sometimes, coming up with ways to do that seems impossible. Most small businesses don’t have much of a sales process or a plan to achieve the increased business that they want. So, how can you make your cash register ring? You can use these five campaigns to attract new customers, get more out of current customers, and get back lost customers:
# Customer reactivation campaign: It’s easier and more cost effective to sell to a current customer than to get a new one. A customer reactivation campaign is simply a systematic way to contact previous customers and get them back on board. When you’re experiencing a slow period, plan a campaign to target customers who haven’t returned in awhile. For example, send a postcard, letter, or email to customers who haven’t purchased from you in 30, 60, or 90 days. Your goal is to win them back as a customer.
# Customer appreciation campaign : The goal here is to reward your loyal customers. You could send them a BOGO (buy one, get one) coupon. Or you can send a handwritten note inviting them to a special event or exclusive hours not available to the general public. You don’t have to appreciate all your customers at once. You can segment your customer list and reach out to them a little at a time. For example, you could have Accountant Appreciation Day or Firefighter Friday for customers who are accountants or firefighters.
# SMS/text campaign : It’s easier than you think to use short message service (SMS) texts and send targeted messages and coupon codes to your customers. A survey conducted by the UK Direct Marketing Association found that 1/3 of US consumers would rather receive offers on their mobile device via text message, than via email, mobile app, or voicemail. And in some cases, the redemption rate for mobile coupons is more than 10 times the average for a paper coupon. It is important to get written consent from your customers before sending them SMS messages. You should also keep aware of all regulations governing SMS text messages.
# Frequency campaign : Your goal here is to do something to increase the frequency of customer purchases. Rewarding customers for purchases is one way to go. AC Nielsen polled more than 29,000 consumers in 58 countries and found that 84% were more likely to choose retailers that offered a loyalty program. They also found that consumers spend 46% more with businesses that have loyalty programs on average. Discounted or free products are always a popular perk for customers. For example, a car wash could give customers a card to track each wash and after four paid car washes, the fifth one is free. Remember to design your campaign using powerful rewards and incentives that encourage frequent visits and increased spending.
# Referral campaign : Get your customers to refer their friends and colleagues. Potential customers are much more likely to trust recommendations from their friends and family members than any marketing you do. In fact, Nielsen research found that 84% of respondents found those recommendations the most trustworthy form of advertising. Why not harness that power by planning a marketing campaign to drive referrals? Research shows that referred customers are likely to spend more money than nonreferred customers. Referred customers also have a 16% higher lifetime value. You can use social media to increase the effectiveness (and visibility) of your campaign.
If you want your business to succeed (and who doesn’t?), you need a plan to make sure you’re getting the sales you need. These five campaigns are a great alternative to crossing your fingers and hoping customers buy.
Landing a new customer is hard—and it’s expensive. Sprint pays $315 to acquire a customer and many of the big financial firms pay close to $200. Hopefully your costs won’t be that high but once you get the customer, the last thing you want to do is lose them. That’s why you have to watch for the signs of an impending breakup and take steps to mend the relationship early.
Sometimes you hear that a complaining customer is actually a good thing because they’re engaged in your company. While that might be true in academic circles, business owners know that people have better things to do than call you when things aren’t working. They get annoyed if they have to spend part of their day trying to get something working.
If you find that one of your customers is calling more frequently and the problems seem to be relatively small, that could be a sign that they’re unhappy with your business. As with any complaint, fix it fast and give them over-the-top service. Don’t make them wait, and for your larger customers, be personally involved in the resolution process.
# No Response
A complaining customer is bad but a customer that says nothing is even worse. Maybe you sent an e-mail, texted, or called but got no response. That’s a really bad sign and one that should be rectified right away. If calls and e-mails aren’t working, making a trip to the business or job site is the next step. A customer who is ignoring you is likely in negotiations with somebody else.
Of course, you shouldn’t let things get to the point of no response. For larger accounts, communicate with them often and for the smaller customers, find reasons to create touchpoints as well.
# The Comparison Game
How often do you hear something like, “The other provider does this but you don’t.” Clearly, your customer is looking at other companies to service them. If that’s the case, it’s time to go back to the sales process and listen to what they want, renegotiate your deal, and make them happy again.
Be warned—this is not a time for defensiveness. Put yourself in the place of your customer. Somebody is probably charging them with finding the best service for the lowest price. Be a partner in that process.
# Unsubscribes from E-mail Lists
Marketing e-mails quickly get annoying when a person’s inbox ends up overrun with them but it’s definitely worth looking into if a client unsubscribes from your e-mail communication. First, make sure you’re using a program that allows the person to give a reason why they’re unsubscribing. If they don’t provide a reason, make a call and find out if everything is ok.
# Quotes the Contract
As soon as your customer starts sounding more like an attorney and less like a customer, there’s a problem. If they’re looking at the contract and quoting line items, they’re clearly unhappy. Instead of getting into a discussion about what the contract does or doesn’t say, ask them more personal questions. Are they unhappy? What is the lack in service that is causing them to look at what they’re entitled to?
Once you find the truth, assure them, and remind your employees that you’re a business that surpasses the terms of the contract. They will always get more than the contract states and if there’s a problem, they should bring it up right away rather than figuring out what they’re entitled to.
# Organizational Changes
If your customer’s company is bought by another company or your main contact leaves, there’s no reason to believe that you will lose the account but you should be proactive about introducing yourself and taking the new decision makers through your sales process that stresses your value over your price.
If you wait for them to contact you, it might be too late. Situations like this should also remind you of the importance of keeping strong relationships with your customers. If you don’t know of a change at a company you do business with, by the time you find out, it could be too late.
# You’ve Quit Investing in Them
They say that you should keeping “dating” your spouse even when you’re married. That’s certainly true in business too. You worked hard to get them—and it was expensive, but it costs 6 to 7 times more to acquire than to retain. That means that the money you spend to keep a customer is far less, so make the investment. Take them out to lunch, invite them to an event, send them marketing materials, and continually follow up.
# Bottom Line
The rules of personal relationships often apply to business relationships because all of us are human. We want to be valued, noticed, and respected. We want to know that our opinion matters and that we’re the type of customer who shouldn’t expect any bumps in the road when it comes to customer service.
Customers still value strong service along with a great product but that includes cultivating and maintaining the relationship. By staying on top of the relationship, when problems arise you’ll hear about them before the customer is in the place of making a decision to stay or leave. As the old cliché says, sometimes the best defense is a great offense.
The smaller your business, the more you and your business are synonymous. People may not know the name of your business at all; they might just know you and for that reason, you have to know how to sell, “you.” As you grow, your business will hopefully gain an identity outside of you but for now, you’re everything.
You know how it works—some people are really good at talking. They’re the people at the events who have a story for any situation. They’re the ones who bounce from group to group seemingly knowing everybody—or can drop a name that they and the group have in common. They’re smooth—sometimes cheesy and annoying—but somehow, they seem to have an endless pipeline of business. As much as you don’t want to hear it, you might need to become a little more like those people. Don’t worry, we’re not advocating turning you into somebody you’re not but there are some skills to learn when selling yourself.
Let’s just call it what it is. Those schmoozers are exuding confidence. They may struggle with confidence just as much as the next person but they know that confidence is what gets them in the door. They know that confidence is professionally attractive so they play the part even if they don’t feel the part. “Fake it until you make it” is a big part of selling yourself. Of course, there’s a fine line between confident and cocky.
We’re not done with the clichés’. How about “The squeaky wheel gets the oil.” For every opportunity (unless it’s some equivalent to a root canal) there are loads of people going for it. Every customer you’re trying to land is being courted by others just like you. Your job is to be persistent—even kind of annoying. Keep sending the e-mails; keep sending the texts; let them know when something changes that is valuable to them. Just keep in contact with them. Even if they’re not ready to buy now, they’ll think of you later.
# Don’t Be Boring
For real—even if you’re not great in social situations, you have to find a way to be unique. Be proud of your introvertness—there’s nothing wrong with you but that doesn’t give you license to not stand out. People who don’t stand out can’t sell themselves because they never get noticed. The cheese-machine at the party is getting noticed.
And of course, your product has to be unique too. That’s great that you design websites but what makes you unique? If you’re not unique, you’re boring. Don’t be boring.
# Offer a Solution
Your customers are plenty-smart enough to identify the problems. What they need is for somebody to dig in to the details and offer a solution. Not something that MIGHT work; something that WILL work.
Offer more of a solution than your competition. Create a detailed report, show that you were super thoughtful about their problem, offer some top level advice free of charge. Become part of their solution before selling your product. Talk is cheap. Your customer certainly wants to know about you but they’re more interested in how you will solve the problem.
A business name that is appealing and memorable can do wonders for a business’s bottom line. On the other hand, no matter how great a business is, an inappropriate or poorly-chosen name can have a negative impact on its success — especially when first starting out.
Some aspects of selecting a business name are subjective and reflect the personal wishes and preferences of the owner.
There are, however, some mistakes that business owners make in naming their establishments that just don’t make good business sense. Avoid these and you’ll be on the road to having a business name that will serve as a real asset and hopefully bring many profitable returns.
# Getting stuck in alphabet soup
A business name that comes at the beginning of the alphabet can be a plus since many business listings are alphabetical; however, some businesses have taken this strategy to absurd levels. Phone book pages produce a staggering number of businesses starting with the letter A, a number of which are somewhat nonsensical: “AAAAA Locksmith” and “AAA Active Appliance.” Other than another word that starts with the letter A, what purpose does the word “Active” serve? Using A, B, or C as the first letter of your business name can help get you an A+ in profits, but be sure the name is something that makes sense and is something you can be proud of.
# Using names that are too long, or difficult to understand, spell or pronounce
The idea is to get people to remember your business name and to be able to understand it, spell it and pronounce it. It should also be short enough to fit on a business card or display on a sign. I doubt the “Floccinaucinihilipilification Company” name would be easy to pass along by word-of-mouth or found readily in a phone book, directory or on the Net. It actually is a word that means “nonexistence” and that’s probably what would happen to any business using it as their name; namely, no longer exist.
# Picking business names that limit business growth
Choose a business name that is wide-ranging enough to give your business growing room.
Geographic business names are popular; i.e., Hidden Springs Housecleaners. But what happens if your business takes off and you’d like to expand the geographic area you cover or even go national? Unless you’re sure you want to stay in one particular location, avoid using geography in your business name. The same goes for naming a business after one product or service: “Al’s Refrigerator Repair Service’s” name would need to change if Al decides to take on air-conditioner repair. Lastly, stay away from names that describe current fads or trends: When the new “Millennium Diner” opened in 1999, it sounded timely — six year later, it sounds dated.
# Letting the grey areas get you discouraged or immobilized
A business name should be one or more of the following: memorable, descriptive, imaginative or distinctive. How to go about this is where the “experts” disagree.
A good way to start is to write down key words that describe what your business is and does, and what you pride yourself on. Use a dictionary and thesaurus to find different words that express these things. Also look for famous expressions that might pertain to your business.
So, let’s say “Mary” has a small business selling her delicious fruit tarts, and she considers herself to be the best at what she does. Mary names her business “Queen of Tarts” because: she loves the play on words, it expresses what her business is and does, and the word “queen” is perfect — she’s female and her thesaurus shows that “queen” also means “person of authority.”
The following techniques of naming businesses are ones that naming pros both love and hate, depending on which pro you speak to. Review the following “bones of contention.” It will be up to you to decide if any of these feel right for you and your business name. Keep in mind your target market, the key elements of your business and mission statement, and — above all — trust that feeling in your gut.
Alliteration: The repetition of the same sounds at the beginning of words
If your name is Cathy, and you’re selling collectibles, you could name your business “Cathy’s Collectibles.”
Coinage: The invention of new words
“Forever Nailz” salon and “ErgoGrip” pens
Descriptive Words: Words in a business name that convey immediately what your business does
“Frank’s Reliable Lawn Care” and “Commercial Cleaning Corp.”
Puns: A play on words
“Hair Force One” and “Shear Artistry” haircutting salons
# Being an island
You’ve thought up 15 business names that are in the final running, and you think they’re all pretty good. Now is the time to get some feedback. Run those names by some close colleagues, family and friends. You might be surprised at the number of things they bring to your attention that you’ve overlooked. A little constructive objectivity goes a long way when choosing a business name.
# Failing to check if your chosen business names belong to another business
Before settling on a final name, you’ll need to ensure that you won’t be violating someone else’s trademark rights to a particular business name. You want to avoid being forced to change your business name in the future and possibly paying money damages.
Here are some ways to avoid using a name that’s identical or confusingly similar to the one you want to use:
- Type your prospective business name into a few search engines to see if the name comes up.
- Check with your county clerk’s office to see whether or not your potential name is already on their list of fictitious or assumed business names, also known as d.b.a.’s (doing business as).
- For corporations, LLC’s, and limited partnerships, type in “Your State Secretary of State” on your favorite search engine to do a business name search on your state’s database.
- Search the federal trademark database to see if a chosen name has already been registered with the U.S. Patent and Trademark Office (USPTO). You can do this through their website, www.uspto.gov. Once there, go to “Trademarks” and then “Search Trademarks.”
For a fee of at least a few hundred dollars, you can also hire a professional search firm to do a trademark search. Just the peace of mind alone that nothing has been overlooked can make this investment worth your while.
As far as naming your business, there are professional naming firms that will come up with a great name for your business, but costs can be prohibitive. David Burd, President of The Naming Company, quoted “$15,000 to $20,000” as a typical fee to have a professional team come up with a business name. For large corporations, Burd said, fees could easily go to “$50,000 to $60,000.”
Getting a business up and running is a project that makes you realize what the term “blood, sweat and tears” is all about. Once you’ve set your goal on becoming your own boss, you spend hours researching your idea, planning the details, and doing a wide variety of tasks to prepare for your launch. Chances are, you also siphon money out of your bank account and run up higher than normal tabs on your credit cards as you focus on that all important day you’ll “officially” be in business.
But no matter how much time and money you put into starting up, your new business could fall flat on its face if you aren’t aware of and take steps to avoid these common business traps:
# Not writing a business plan
If you’re not seeking outside investors or trying to get a business loan from a bank you may think you don’t need to write up a business plan. Gathering all the data you need for a business plan will take time away from the other things you want to do to get the business going, and besides, you know what kind of business you want to start, so why bother writing it all down? Right?
A business plan isn’t just a document to be used to raise money for a business. It’s your business roadmap. It helps you focus not only on your goal, but also on what it will take to reach your goal. Say you want to bring in $100,000 in sales your first year in business. The business plan will make you consider the number of customers you’ll need to acquire, how you’ll acquire them, and what costs will be associated with selling your products or services. Without those details, you have no way of knowing if your sales goal is realistic, or if you’ll make a profit.
# Insufficient cash to run the business
Writing a business plan will help you estimate the amount of cash you’ll need to get the business going, but unless you’ve run a similar business before, you are still likely to run into a few financial surprises and setbacks along the way. Then, too, it may take a lot longer than you predicted to build a steady flow of customers and cash. To minimize your risk of falling into this trap, try to find out how much other similar businesses spent to get started, and look at trade journals or other resources to determine average annual sales for the type of business you plan to start.
# Underestimating the need for marketing
No matter how good the products and services you sell are, they won’t sell if customers don’t know (or forget!) that your business exists. The friends and family members you hope will talk up your business and send customers your way, probably won’t. The business acquaintances who told you to told you to give them a call once you got started, will be out of the office or in a meeting whenever you try to reach them.. And the social media pages you hope will get you sales or leads? Surprise! You’ll need to market those pages to get them found.
Avoid this trap by developing a carefully thought out, well-rounded marketing plan for your business. The plan should identify your target customers, the various ways you’ll need to reach them and amount of funds you’ll need to do the necessary marketing. Remember, marketing is an ongoing activity, not a once and done thing.
# Leveraging far more opportunities than are viable
The success of any business hinges on the entrepreneur’s ability to spot great opportunities and take advantage of them in time. However, it is critical to assess the viability of the opportunity and only take it up if it is aligned with your current business focus and if your business is truly ready to add new products of features. Your business finances, manpower, current operational efficiencies, and customer base all have to be considered thoroughly. Will the new opportunity fit in with business without compromising your current level and quality of operations? If not, shelve the idea, at least temporarily.
Besides stretching your resources, jumping on every idea that comes along could prevent you from being seen as an expert in any of your core business skills. Clients you target for your management consulting services may wonder how good you really are if you’re also selling web design services or nutritional supplements on the side.
# Being inflexible
In a highly competitive marketplace, your business needs to stay focused, but also stay aware of changing marketplaces and alternate approaches to reach your goal. Your business plan may call for you to target small local businesses with your product line, but the most profitable market might be corporations that buy in quantity. The software your developing for desktop computer use may also need to run on smart phones. While you don’t want to shift gears every time someone suggests an alternate route to you, your business plan and your own attitude should be flexible enough to let you change course when there is sufficient evidence that doing so is in the best interest of the business.
# Not staking your claims online
Like it or not, businesses today need to be found on the Internet, and they need to be found in multiple places on the Internet. Consumers and B2B customers alike turn to the Internet to find products and services providers and to research what they buy and who they buy it from. Even if you typically get most of your business by word-of-mouth, the people who hear about you will most likely look you up on the Internet before they contact you. They’ll search on their smart phone or their computer. They’ll look for your website (and wonder about your professionalism and longevity if you don’t have one). They’ll look at your social media pages and profiles. And they may look for you on YouTube and Slideshare, search review sites for comments about your business, or search the major search engines for terms such as,”Has anyone heard of …”
While you can’t control everything people find in their searches, you need to control what you can. Those things at the very least are having a presentable website, and detailed social media profiles, and local listings on the major search engines if your business caters to local foot traffic.
Although there is no way to guarantee any startup will ultimately be successful, being aware of and avoiding these 6 common business start up traps will help reduce your risk of failure.
Whether you’re looking to make spending money in your spare time or launch a part-time business that could evolve into a full-time career, the opportunities are virtually limitless. From leveraging your natural talents in the freelancing world to filling a void in the marketplace, these business ideas will inspire you to carve out your own niche.
# Become a re-seller
Sell unwanted or new items via Amazon, eBay, Etsy and other online marketplaces. This type of business can be scaled to your schedule, budget and inventory.
# Create social media posts for businesses
Although finding clients may be easier with a marketing degree, connections and a knack for crafting relevant posts on Facebook, Twitter and other social media platforms can help you launch a successful social media business.
# Sell your arts and crafts projects
Artists and crafty types have plenty of opportunities to make money. Get involved with your local arts community, and sell your wares at area art fairs or craft shows. Join Etsy or another online arts and crafts marketplace, or set up your own website.
# Clean houses or businesses
If you’re fast and produce great results, professional cleaning can be lucrative. Both types of cleaning services can be done on a part-time basis; whether you choose residential or business depends largely on your schedule.
# Become a tutor
Whether you’re helping young students with difficult academic subjects or enabling adults to master a language or learn a new skill, tutoring is a profitable side business that doesn’t require a huge time investment.
# Start an information marketing business
From weight loss to career development, you can earn a passive income by creating information products on one of an endless number of subjects. Offering expert information via eBook, CD, video or another format can help you earn a passive income while working a full-time job.
# Start a repair business
If you’re a handy man or woman, your skills are in demand. Help homeowners complete their “honey-do” lists by performing household tasks for which they lack the time or knowledge. Find out whether permits are required in your area.
# Offer personal training services
Personal training is a natural fit for those who are passionate about physical fitness. Trainers can also work full-time jobs because most clients want appointments after work or on weekends. You’ll need to invest some time and money in certification.
# Offer your services as a freelance personal assistant
If you’re efficient, you’re reliable and you love being on the go, this may be the business for you. From grocery shopping and purchasing gifts to dropping off dry cleaning or picking up concert tickets, helping busy people save time will make you an in-demand assistant.
# Provide pet services
Animal lovers can profit from their passion by offering a range of pet services. Dog walking, waste cleanup, pet-sitting and transporting pets to appointments are just some of the profitable ways you can help pet owners save time.
# Start a cooking or baking business
Turn your baking or cooking skills into a side business. Decorating cakes, catering and selling baked goods are just a few ways to make money online or in your area. It’s important to note that you’ll need to learn about city and county food preparation regulations if you decide to cater or sell locally.
# Write for money
Online article writing and blogging are some of the easiest, most flexible ways to break into professional writing. More experience may be required for copy writing, technical writing and certain other types of content creation. Gain clients through your own website or by getting in touch with local businesses.
# Become a purveyor of natural products
Toxin- and chemical-free products are sought after by “green” consumers. Turn a soap-making hobby into a business, or sell nicely packaged natural cleaning products online and at local events. Consider offering free samples to friends, family and other willing recipients in exchange for their honest opinions before selling your products to the public.
# Get involved in affiliate marketing
Affiliate programs allow you to make money by promoting a company’s products. When customers buy from a business by clicking on an ad or link on your website or blog, you make money. Affiliate programs abound, allowing you to profit from click-through links to small business sites or mega-retailers like Amazon.
# Provide virtual assistant services
Busy professionals often need help with clerical and customer service-related tasks. The great news is that you can make money by supplying virtual assistant services from your own home. From answering emails to organizing contact lists, you can help business people save time and money while earning money in your spare time.
These business ideas can help you find the perfect venture for your skill set or maybe even inspire you to create an entirely new moneymaking niche.
The business start-up checklist below is meant to remind you of the tasks you may have to perform when starting your business.
Not every small business will have to complete each step. For instance, you may decide not to register your trademark with state or federal officials. Or, you may not be required to publish a notice of intent to do business.
Since laws vary by state and by type of business, be sure to check with local authorities to determine if there are any additional legal steps you need to take.
- Choose a business based on your skills and interests
- Research the business idea
– What will you sell
– Is it legal
– Who will buy it and how often
– Are you willing to do what it takes to sell the product
– What will it cost to produce, advertise, sell & deliver
– With what laws will you have to comply
– Can you make a profit
– How long will it take to make a profit
- Write a business plan and marketing plan
- Choose a business name
- Verify right to use the name
- See if the business name is available as a domain name
- Register the business name and get a business certificate
- Register your domain name even if you aren’t ready to use it yet
- Choose a location for the business or make space in the house for it
- Check zoning laws
- File partnership or corporate papers
- Get any required business licenses or permits
- Reserve your corporate name if you will be incorporating
- Register or reserve state or federal trademark
- Register copyrights
- Apply for patent if you will be marketing an invention
- Order any required notices (advertisements you have to place) of your intent to do business in the community
- Have business phone or extra residential phone lines installed
- Check into business insurance needs
- Find out about health insurance if you will not have coverage under a spouse