Just a few thoughts to share for those of you who own a small business or are thinking of starting one, based on my [redacted] years of experience as a tax accountant:

1.  Buy some decent business cards.   Nothing says part time, dead-broke wanna-be like a crummy little business card printed off your inkjet printer, even if you carefully removed most of the perforations around the edges.  Real businesses have real business cards.  They don't cost much, I pay about $85 per box of 500 for full, four color print.  Spend the money.

2.  Get your own internet domain name.  JoeYerkel @ yahoo.com doesn't impress me, and won't impress anyone out there.  [email protected] shows that you are in it for the long haul and care about your image.  You can register a domain for 10 bucks a year or so.  Google Mail will host your email servers for FREE and provide great spam filtering.  I use GoDaddy.com - cheap and good service to boot.  Spend the money.

3.  Don't ask me for a deposit for a $400 job.  If you can't float a few hundred bucks before working for me, you probably don't do enough work to be any good at what you do.  On the other hand, a $10k job? Sure - I wouldn't do that much work without a signed agreement and a down payment, because then I'm extending credit, not relying on my customer to float my finances for 30 days.

4. Don't use your home phone number for a regular business number.  I don't want to call and explain to the 12 year old that answer the phone (who insists on taking message) that I need a dozen J19 units instead of the R21s with additional flux capacitors installed.  Get a business number - either land line or cell phone.  If you can't afford $15/month, you probably don't do enough work to be good at what you do.  Spend the money.

5.  Don't tell me you don't have a fax machine.  You can buy one at Office Max for $30.  You can get a virtual fax number that will convert the fax into a .pdf file and send it to your email address.  Real businesses have fax numbers.  Spend the money.

6.  Depending on your business, write up a price list.  Nothing irritates me more than being told a price that is made up on the spot and isn't based on anything more than what you think you can get out of me at the moment.  I'm not an impulse buyer and I'll probably call you back 2-3 weeks later.  You give me a different price for the same item / service without a _very_ good explanation, you're not getting my business.

7.  Don't be afraid to make a collections call.  Your customers won't think poorly of you for calling about an invoice that's 60 days overdue, but they will if you're rude, pushy or tacky about it.  Make the call at 30 days, and again at 45 days if necessary.  Follow up with your customer - they will most likely pay you, just be polite about it.

8.  Don't worry about telling a customer to take a hike.  Part of business is "firing" customers.  They either are too difficult to work with, or don't pay their bill, or want you to do substandard work and cover it up with the inspector.  You don't need any of those people in your life.  Tell them you can't work with them anymore, and move on.  Life will be better.

9.  If you have employees, don't get behind on payroll taxes.  The penalties and interest will balloon up on you and overwhelm you.  Hire a payroll service like ADP or Paychex if necessary - they will pull all the wages and taxes out of your account each pay period so you can't fall behind.  It's peace of mind and money well spent if you don't know how to do it yourself.

10.  Don't use your personal bank account for business.  I don't want to write a check to Herb E. Curb for electrical work - I want to pay Herbus Curbus Electricans LLC.  If you're too cheap to afford a separate bank account, you probably don't do enough work to be good at what you do.   Also, a check made out to you personally gives me the impression you don't plan to pay taxes on that money.  I pay a ton of taxes and I just don't feel the desire to watch you get away without paying your share.


Feel free to add your own tips and ideas.

Interesting... SOmething they should have taught me when going for my BS in business.

All true, but add the following:

11) An accountant is the best money you will ever spend.
12) Sometimes, you need to fire the customer.
13) There is never a good reason to compromise your integrity. Ever.

Originally Posted By Toiyabe66: All true, but add the following: 12) Sometimes, you need to fire the customer.

cough, cough, #8, cough, cough.....  

Originally Posted By tax_monster: Originally Posted By Toiyabe66: All true, but add the following: 12) Sometimes, you need to fire the customer. cough, cough, #8, cough, cough.....

It needed to be said twice. It's really, really hard for most people to get.

I had a big reply, and the damn computer crashed, let's try again.

it's better to do nothing for nothing than something for nothing.  I.e. There's no reason to work for free.  I can make the same amount of money sitting at home doing nothing than I can working hard on a badly bid job.  Know what you are worth and what to bid.

if you are going to have a web site, make it work.  all the pages, links, pictures, etc all need to work.  don't have blank pages, pages that have nothing on them, "under construction", etc.
Make sure it has contact info.  If you use email as a contact, answer the damn email.

If your market niche is low price, expect to get some really "interesting" customers.  

People say they want service, and they do, but most don't want to pay for it, just FYI.  

Originally Posted By rasanders22: Interesting... SOmething they should have taught me when going for my BS in business.

Thats your problem right there.

Cash is king, take care of your cash.  You can profitable and run out of cash.  Oh, and guess what?  You get to pay yourself last.  Take care of your receivables, yes it's a pain, yes it sucks, but you earned the money, now go get it.  People who don't pay are not good customers.

Watch your overhead.  The most amazing things that you would never think of pop up to eat up your profits (cash).  For my business it's tires, you wouldn't believe the tires we go through and it's not something I  considered at all when doing the original business plan.  Keeping your costs low means more money flows to the bottom line.  

Charge enough.  Too many business's don't charge enough for their time and effort and slowly go out of business.  Also many people invest capital in equipment, but don't charge enough to buy new equipment when that equipment wears out.  

If you have a partnership draw up a buyout plan before starting. You never know what the future holds.

I have to disagree with number 3. I've been stiffed on smaller jobs much more than I have on larger ones. If I've never done business with you before...or very little business. I'm not going to order product that I don't stock without some up front. Why should I?

I have clients that I will float up to a point...but not many. If you want something...order it and pay for it. You don't go into Best Buy/Target/WalMart and take items home without paying for them...why should my products be any different/

Now...the rest of it is pertty much right on. I can't believe how many "business" people use Yahoo/Gmail/comcast email addresses. I don't care if it's [email protected] still doesn't look professional

Originally Posted By OdT: Originally Posted By dunndw: I can't believe how many "business" people use Yahoo/Gmail/comcast email addresses. I don't care if it's [email protected] still doesn't look professional You just reminded me that I had meant to disagree to some of the above a little. The domain name in the email address, and the colorful business cards as mentioned above, or anything else related to the paperwork jungle associated with business really doesn't matter to me much. I get it sort of, and understand what people are saying, but it all seams about as trivial as a license plate number on a car. It provides information only, it's not an art contest. I copy and paste email addresses without ever reading them, and never look at anything on a business card but the information needed right then. I do look people in the eye when doing business with them however. Dunno, maybe it's the superficial card exchange at meetings between people who have no desire or need to speak to each other again, or the obnoxious job titles folks use these days. (ie desk clerk renamed Guest Services Representative ) Anyhow, I guess it's important because so many agree it is. Lacks any real value IMO.

IMO it depends what your small business is about. If you do yards and local stuff that can't be imported (or have the work exported) you probably don't need one but the moment you do something like furniture, websites, sports gear you have to show to the client he's not getting something he could have gotten from China.

I'd just like to add that I have seen many businesses fail when they should have succeeded because they didn't have a good business plan that included marketing.

Appropriate, targeted marketing means a lot these days. It's what I do for a living and I see cases when a good product isn't taken seriously because they don't have a credible look, or worse, they simply look amateur and/or a ripoff.

Definitely engage - early on - an advertising partner that can handle your look for you and understands what it is that you do. To borrow tax_monster's phrase, "Spend the money".

Cheers.

Learn to say no and mean it.

Originally Posted By treemydawg: Originally Posted By rasanders22: Interesting... SOmething they should have taught me when going for my BS in business. Thats your problem right there.

+1

I have to agree with #1.

Good business cards are very important.  Maybe it's because we offer printed cards along with our other services, but I look at every card I am handed and it tells a lot about the person.  If it is a home-printed card with scored edges, I'm going to wonder how serious you are.  If your cards are thin cu

Get some high-quality, full color business cards and hand them out to everyone you meet.  It will be the best $40.00 (for 1000 cards) you will ever spend!!

Great post, btw.

Eric  

fixed it for ya..

Hmm all good...ODT is right on.....

#1 mistake i see from NEW small biz people is.......drum roll......... spending to much on things they don't need and do nothing to earn them more biz!

oh and.... they are often experts in what they do....but know nothing about running and growing a small biz....

Passion for what you do..... is very important..... lack of passion for being the "Chief EVERYTHING officer"....is a problem!

just my 2 cents ;  ) from a young small biz "everything" consultant

+1

I can't stand wasteful spending, and the last small business I worked for failed because they just HAD to have all the neatest things, none of which contributed to increased sales.

I'm not a business-person, but from watching others fail, I would also advise you to know your market. If you run a business in an area that has a limited customer-base, don't run your business as if half the state is outside your door. If you're going to only have a few customers, you don't need the most expensive gear on the market.

Tailor your business to the potential of the local customer-base, as necessary.

#1 is especially important IMO.

You may not be a professional, and you may not act like one, but at least you can give the appearance of being one with some good quality biz cards.

Hell I went the extra step and had some magnets made up to look like my biz cards and I drop one in with every order I ship. People see my name on their fridge, they are more likely to think of my business when they have a need for gun stuff or survival gear.

I think some people get too focused on having a web prescience than having a good web prescience.  Many of my friends advocate getting a website no matter matter how little content you have to put on it.  I have lost count of how many business with low to no content websites I have checked out that never got a second look because there was nothing there.  If online service is going to be a major part of your business make sure it actually up to snuff and dozens of links to a coming soon page before you launch it.

Perhaps I am being selfish because I am in insurance, but I would add that having the appropriate insurance coverage at the best price availabile is in there.  It kind of correlates with not wasting your money, but it goes beyond that.  You need to work with someone that will help you figure out what that coverage is and what the best price available is.  If you work with someone who is captive, don't forget that when you sell hammers, everything looks like a nail.  Find someone independent that you trust.  You can go broke over paying for insurance and you can go broke by not having the right insurance when you need it.

Show up for work.  Finish on time.

I'll add a few of my own tips...

1.  About the phone:  I agree...you need a dedicated phone line.  But you don't even need to spend $15/month.  Just spend $40 (one time) for a "MagicJack", and voila...instant business phone!  The MagicJack plugs into your computer's USB port, and can go wherever you go.  And for that $40, you get a phone number AND the entire first year of service AND voicemail (that will go right to your email if you so choose) AND a host of other features.  I use a MagicJack for my business line, and it works great.  It's a perfect example of technology making things easier and cheaper.

2.  About websites:  In this day and age, most businesses need one.  These days, many people turn to the Internet to look for products and services, or to do research on products and services.  If they can find you, and your website provides the right "look" and content, you may get the sale.  I won't elaborate on this, because entire books could be (and have been) written on this subject.  Regardless, you CAN make a professional website yourself.  It's easy nowadays.  But if you don't want to do it yourself, don't pay a ridiculous amount.  A tech-savvy college kid can build a good website for you for under $300.  When done, you MUST market your site.  And you gotta do it right.  Just like in the offline world, simply throwing money into advertising, doesn't mean you'll get customers.  When it comes to online marketing, you REALLY need to know what you're doing, or hire someone who does.

3.  As already said, operate your business with nothing but honesty and integrity.  It is an unfortunate fact that too many businesses are run by sleezebags.  Don't be that guy!!!

4.  Always have a back-up plan.  Make a list of the 10 worst things that could happen to your business, and draw up a plan describing how you would realistically solve those problems.  

5.  Provide value to your customers, solve their problems, make them glad they chose you and do the right thing at all times, and you will develop a steady client base.

If you use a website for any significant part of your business, spend the money to make it awesome.

Especially if like my company your website is used mainly for building credibility.

Pay your bills

you may not realize this, but people/business's that pay quickly and fast get by far the best prices over time.

The one thing about running your own business, is you get paid last.

If you don't (or are slow), you'll find you won't get much of a discount over time, nor will people jump for you and you will get a name.

I have customers who always pay, but they are slow slow slow.

They pay a lot more than the customer who pays me right away.

I'm not the only one.

Worth boldening.

I'll add a tip that never failed me yet, Go with your gut, gut's never lie.

I'm going to add - Supply Chain Management. If you don't know what it means, look it up! Seriously, this is an integral part of any business plan.

If you communicate with your customers or clients in any written format (including business cards, email, website, pamphlets, invoices), make sure that your grammar, spelling, punctuation, and word use are all correct. Many potential customers will see poorly written copy and assume (rightly or wrongly) that someone who doesn't know what to do with an apostrophe also doesn't know what to do with a flux capacitor (lawn mower, jackhammer, dental drill, security code, etc.). Being an informal forum, we know that people don't put as much effort into proofreading their posts as they would anything business related. If business copy were written with the same standards that forum posts are, there would be a whole lot of businesses out there with no (literate) customers, scratching their heads and wondering why.
(Some common things to avoid: better then our competition; we make the best widget's in town; knifes; could of; one off; I have to (or too) rifle's; their's) I have edited the written material for several companies I've worked for, though it wasn't in my job description, just because I was the only one capable or who cared; had I not, said companies would have made themselves appear very unprofessional. If you are not going to take some classes or read a few books to brush up on the finer nuances of the English language in its written form, it might be worth your money to hire somebody to proofread for you. Rocket science or graduate level competency is not required; a good sixth grade understanding should be sufficient.

I'm going to +1 this just because it is so important.

Fairly or unfairly, people will judge you based on the way you communicate in both the spoken and written language.  I'm always surprised at how many people don't seem to grasp this concept.

I've worked for several small businesses, a few have failed and a few are still doing well.  Businesses rise to the top or sink to the top because of management, period.

I now run a small business and the simplest advice I can give is this.  If you don't have the balls to face every problem that comes along, and do what's right for your business, then don't bother going into business.

If an employee isn't making you money they are costing you money.

Sales people who make cold calls or show up un-announced get thrown out.  There are some guys I've dealt with for a long time who can show up without an appointment but if you're selling something and we have never met, you can f*($*# off.
  I once had a boss who did this to un-announced sales people.
Boss: "I don't deal with anyone who doesn't have an appointment"
Salesperson with foreign accent: "But if you could give me a momen...."
Boss: "GET THE F#$* OUT TOWEL HEAD!!!!"
Very rude, but it worked, its OK to insist people not waste your time with crap you didn't ask for.

Finally, know when its time to fold, and know when its time to move your business in a different direction.  Always have an exit strategy.

Coming up on calender year end(most small businesses use FY = CY)

Amazing how many deductible expenses fall through the cracks. It's not the big things, but many small things:

1) Merchant account for credit cards? Don't depend only on your monthly merchant account monthly statement. Look at your checking/merchant bank account deductions for the maze of credit card fees, and compare to the statement (s). I'll bet they won't match. There will be one or two more fees than on the statement. My CPA didn't even catch these!

2) Do you have a business partner? I'll bet the bastard (just kidding) doesn't turn all his receipts in. No, hookers are not tax deductible.

3) Some things just don't give receipts and you have to be aggressive. Even buying checks, they never sent a receipt/paid with the physical checks.

4) Anything related to advertising seems to be forgotten often.

5) Donate as a business!

Do you think that a fax machine is a technological hold over?  
Maybe enough people still use them to make it compelling, but there is a better way to transmit data - especially secure data.

I think actual fax "machines" are obsolete, but they are so widespread that I think it would be foolish not to be able to accept faxes.

I have a virtual fax # that converts the incoming fax into a pdf file and sends it to my email inbox.  I can also upload and fax a variety of file types (jpg, pdf, ms word, etc) if desired.  I think it's a good transition between getting rid of the fax machine and still keeping the fax line as an alternative source of information.

+3. For a new client, not only will I ask you for a deposit, but for jobs under $500 I'll be asking for the full amount up front, thanks very much.

Quoted for truth. I agree 100%.

I know that in my line of work, fax machines are used constantly, day in and day out. I don't have a fax machine in my office, but in the next office over there's one for me to use. I don't know how many times I've thought about purchasing one of my own for work, but haven't because I've been saving up for my own startup business.

Only thing I disagree with is the fax machine.

I suppose it's business-specific, but this is my 14th year as an IT consulting/provider owner and I have never used or needed a fax machine.  My world revolves 100% around e-mail (and cell phones.)   Even in the early days, I never remember a situation where I needed to send or receive a fax where e-mail couldn't fill the void or was the preferred method to begin with.

I'm an attorney and some people fax quite regularly. State government entities come to mind. My firm uses a virtual fax number and fax maker to receive and send. Basically for sending a fax, you scan the document, and attach to email and send it to [email protected]. Works like a charm and you get the conf. emailed back to you, not in a stack of crap at the fax machine.

Well, you might want to look at the original post date of this thread.  I wrote this in 2008.  Sure doesn't seem that long ago.

Wow - I posted this same thing a year ago.  I must be getting old and senile.  

Running a business since 2008 here's my personal experience

1. Try not to take debt
2. If you are making money, dont spend it all and expand as soon as you can. That golden period boost comes only once or twice, take the opportunity and expand
3. Banks looks at profit to give loan, too much expense deductibles and you are setting up yourself for not getting a loan.
4. If its not against the law and making you money do it. People can whine about shit all the time being unethical, but hey think insurance companies.

1. Figure out what your production capacity is. Every business has one, whether it's imposed by time, space, personnel,  machinery, or whatever.
2. Figure out how much you can realistically sell that output for.
3. Figure out how much it will realistically cost you to produce and sell that output.

If the difference between 2 and 3 is not enough for you to live on comfortably, then your business cannot succeed. I deal with a lot of failed businesses. The owners never do this analysis. Most of them can't even get their heads around what it means.

If the difference is enough, the next step is to figure out how much product you can realistically sell.

What is a good, preferably inexpensive way to get another phone number linked or relayed to a cell.  I tried Google voice, but it prompts the caller for their name.  Not very professional.  It's the perforated business card of phone communications.  I don't want to deal with another cell phone just for the business.  I have a hard enough time remembering to charge my personal cell.

Also, anyone use FB targeted ads?

ETA-   I poked around the google voice settings this weekend.  I can toggle off the call screening thankfully.

5. Don't tell me you don't have a fax machine. You can buy one at Office Max for $30. You can get a virtual fax number that will convert the fax into a .pdf file and send it to your email address. Real businesses have fax numbers. Spend the money.

Real businesses have a scanner....

Im gonna go ahead a disagree with you on this one.

3. Don't ask me for a deposit for a $400 job. If you can't float a few hundred bucks before working for me, you probably don't do enough work to be any good at what you do. On the other hand, a $10k job? Sure - I wouldn't do that much work without a signed agreement and a down payment, because then I'm extending credit, not relying on my customer to float my finances for 30 days

In my business (auto repair) you diagnosis or quote, and dont take a deposit,  get ready for the customer to find someone cheaper or just ignore the problem.  You don't take a deposit and your either stuck with parts you may never need and can't send back(electrical parts you own), or a 20% restocking fee.

If the customer can't put 20% down they dont have any of the money.

I already have 11 covered as I am a Certified Public Accountant.

Now I just need to get off my ass and pick a direction that I want to go in.  I tried the scattergun approach this year sticking my hand into different endeavors that I always wanted to try, only to realize that making money at them is tough.  I found out the hard way that some will just refuse to pay extra for customer service and convenience even though I was doing a better job than my competition.  At the end of the day, it all came down to price.  They could care less that the reason I charged more was because I was using a superior product which costs more.  

I will approach things differently in 2018.

ETA:  Since I switched to FIOS at the house, traditional fax machines no longer worked and I wasn't willing to get a POTS line just to connect a fax machine to it.  As a result, I had to switch to a cloud fax account for my CPA practice.  I may add cloud phone service to it too since I can install an app on my cell phone and take calls that way.

Most businesses need a CRM (Customer Relationship Manager) to help keep track of customers/prospects, deals and follow ups. Let me know if you need any recommendations.

weird first post, but OK.