Self-employment is becoming increasingly popular and there are now 4.69m self-employed people in the UK, accounting for 15% of the workforce (figures from May 2016).
I spoke to a self-employed tradesman today who told me he loves his job but the admin side gets him down, he goes out to work from 8am until early evening and then must play catch up when he gets home, often til silly o’clock meaning he misses out on quality family time or just ‘down time’. The front of his van is stacked with receipts and he just doesn’t have time to do anything with them!
Many small businesses fail – it’s no secret that the current economic climate is tough for the self-employed and I have researched what attributes to the failure of small businesses and I believe this is an important question however the more important question is how can it be prevented?
· Don’t mistake your business as a hobby – just because you love something doesn’t mean it is a viable business. Do others share your passion, would it sell, or would it be a dragon’s den idea that would get laughed at and may just be a quick buck and then it would fail to succeed? Think about your business idea, research it and then make the trusted decision on whether it could make you any real money!
· Poor Planning – Depending on what your business idea is, you will probably need a business plan. It doesn’t need to be war and peace, a simple 3 page will do the trick, it’s the content that is important. Look at all aspects of your business and be prepared to tackle problems should they arise. Your business plan should have goals and vision and how you expect to reach these? Your business plan is not set in stone, you can adapt and amend it at any point.
· One service, one client – as they say ‘don’t put all your eggs in one basket’ – too often small businesses focus on one idea, one service, one client, but what happens when that one thing you’ve focussed on disappears? The world is evolving and you need to stay ahead of your game.
· Poor administration – it’s part of everyone’s job role, be it big or be it small however there is no hiding away from it or putting it off until tomorrow! You need to keep on top of it and keep clear and precise business records. If you don’t like doing it, then perhaps this is the time to think about a helping hand.
· Experience – if you are a one-man band or have workers there are so many hats you must wear, you need to market your business, sell it, manage it, finance it, etc. This will help it run successfully. You also need to stay ahead of the industry and constantly research it, new game players, new skills, new products. If you don’t know these basics, then it’s time to educate yourself. Look at the other local businesses in your area, what are they offering and if you can check out their pricing structure – you don’t always want to be cheaper and undersell yourself but at the same time you want to be competitive.
· Money – you’ll need a steady stream of work to survive however this doesn’t just land on your lap so you will need some sort of financial security whilst in the set-up / early stages. Depending on your line of work, you may also need to be able to pay up front for any materials etc. Create a realistic business budget and make sure you keep on top of your business books. Too many small business stall because they don’t have enough cash.
· Location – are you targeting the right area, are there as they say ‘too many chiefs’. Research suppliers near your area and check if you are in a convenient area to your customer base.
· Competition – this is a big one as customers will generally buy from price! It’s important you know who your competition is, what they have to offer and what makes your products / services better?
· Time Management – don’t put off tasks that you don’t enjoy, they need doing and they will drain your business! Don’t let tasks pile up, they all need to be done and it is better to get them done sooner rather than later. Outsourcing tasks you don’t enjoy can be one way to tackle them.
· Marketing – Social media is great, there any so many platforms that can help you, LinkedIn, Twitter, Facebook, local publications. Marketing nowadays does not have to be expensive but you need to keep on top of it and ensure your response rates are timely.
· Sales – don’t be pushy, there is nothing worse than a pushy sales person, provide quotations in a timely manner, follow them up in a timely manner – make sure you know your product and the services you offer. Don’t constantly chase as this can make you appear too keen. If your pricing and product is right the customer will buy from you.
· Customer service – Once you have a customer, you want to keep them. Pay attention to the customers’ requirements, understand their end goal and work with them to achieve it. Your attitude can play a huge part here so keep a pleasant demeanour.
Owning and running your own business requires a huge amount of time and investment. Don’t be afraid to turn to family and friends for help in the early stages. You will go through a whole host of emotions and your energy will be drained, it’s easy to work long days and forget to take time off. Motivation, enthusiasm and time management are key success drivers. You don’t have to go it alone, ask for help where needed and outsource the tasks you don’t enjoy. Create a plan and this will help you grow and thrive. You can run a successful business, it just takes a little planning.
Blog written by Steph Sordillo, Elite PA Services 29/03/2017