How do you get your new business known?

One of the major challenges for any start-up is getting your name out there before the people.  This is especially difficult if you do not have a brick-and-mortar store.  If one opens a retail store, puts up a big sign on the front, then it is likely that people will see the name of your business as they drive by.  But, you better hope that they do more than drive by.  They better be stopping because you've got a lot of money tied up in rent, utilities, insurance, product, labor, and the other expenses of operating a business.  In our community I see a lot of small businesses open up and close in less than a year because they lacked the capital to remain open while they built their business and their business did not generate enough income to cash flow the business during that start-up.

I don't have a building with a big sign and a lot of monthly expenses.  I am starting an auction business.  I can conduct auctions on-site or I can rent a facility for a couple of days to conduct my auctions.  Like many service businesses my start-up costs are minimal.  I like that because that means there is less risk, but it also makes it more difficult to get my name out to the public.  There are dozens of auctioneers in the area in which I live, but 4-5 of them gets the majority of the auction business.  That handful have been in the business many years and enjoy top-of-the-mind awareness with people considering selling at auctions.  So what can someone like me do?

Naturally, I pass out business cards whenever possible.  I run the occasional ad in some of the surrounding papers.  And, I try to be in front of the public whenever possible.  That means I often work for some of the 4-5 auctioneers I mentioned earlier.  Sometimes I'm on the payroll, and sometimes I just jump in and help work the ring for free.  Although these are competitors of mine, they are also colleagues and are willing to recognize me and my auction business.  Any time I'm working an auction for another auctioneer they always announce who I am and that I recently received my auctioneer's license. They allow me to showcase my abilities both in the ring and with the microphone.  This past Saturday I assisted one auctioneer, and when that auction ended I went to another event where I had agreed to do a charity auction.  They only had three items to sell, but they made some money for the organization, and everybody had a good time with the music group that played before and after the auction.  Between the two events I was able to showcase my auction talents to about 300 people.

Giving away samples of your product or service may not seem like the most profitable thing to do, but it is a way to help people become aware of what you offer.  If you touch enough people with your product or service you will eventually begin to turn some of them into clients who will purchase those items or services.  This does require patience and time.  Trying to be an overnight success in any business endeavor is more likely to result in failure.  Take your time. Connect with people. Let them experience how your products or services can benefit them even if you have to give them away at the start, and eventually you'll find that your business will become known to the public.

First you have to start

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"No one aims for average.  No one sets out for status quo.  No one longs for ordinary.  But one day you wake up and ask yourself, How did I get here?"  These are the words on the inside flyleaf of Jon Acuff's book Start: Punch Fear in the Face, Escape Average and Do Work that Matters.  They are words that many of us have said and might even be saying now.  We say them when we hit those transitions times in our lives.  We say them again when we wake up one day and realize that it is going to be like every other recent day, and we're just not sure we can take it anymore.  We repeat them when something triggers thoughts of unrealized dreams, and we wonder if it's now too late to make them a reality.

Most people intend to do something significant with their lives.  I doubt that there is anyone who hasn't had big dreams and had every intention of fulfilling them sometime.  Of course, that is the key word here isn't it: sometime.  Too many of us are content to live on Someday Isle.  Someday I'll start that business I always wanted to own.  Someday I'll complete that degree.  Someday I'll spend more time with our children.  Someday I'll get serious about getting our finances right.  Someday I'll focus more on exercise and healthy eating.  Someday I'll....

The problem is someday never comes, and one day we realize that the opportunities to do those things we dreamed about are behind us.  In his book, Acuff writes that fear is one of the primary reasons we don't seek to live out our dreams.  We are afraid of the unknown.  We are afraid of failure.  We are afraid of what others might think or say.  Some may even be afraid of success.  Until we address the fears that hold us back we will never live up to our capabilities or achieve the things we've dreamed of achieving.  We have to stop listening to those voices within and without that creates fear.  Acuff provides several specific things we can do to overcome that fear and move on with our lives.

Fear is what keeps people from starting that small business they've wanted to own.  For owners of small businesses, fear is what keeps them from taking it to higher levels.  We settle for normal because normal pays the bills and provides us with a regular income.  We don't want to risk that by trying to grow our business so we settle.  But, while we're settling we're also stewing inside because we know we could be doing so much more. 

I spend a lot of time working with church leaders, and many of them have settled for the ordinary as well.  In fact, it's safe to say that some have just given up.  They have been beaten down so often by having their ideas rejected by small minded people with big pocketbooks they've stopped dreaming.  They make no effort to lead their churches any more; they're content to just manage what they've got.  They have forfeited their role as prophet and leader and settle for becoming a chaplain.  In some cases, they are hospice chaplains providing care for a dying institution.

Life is too short to do work that doesn't matter.  Life is meant to be lived with purpose, and part of that purpose is to follow your dreams and to achieve everything you were created to achieve.  To do so will require some determination on your part and a plan.  Acuff's book can help you identify a plan.  After all, if you want to accomplish something the first thing you have to do is  Start: Punch Fear in the Face, Escape Average and Do Work that Matters.

Showcase your talents

In my last post I discussed the challenges of getting started in a new business.  Advertising and networking are only two ways to get your name out.  While both are important, a third way should not be overlooked.  Showcase your talent while working with others in your field.  This may not be possible for everyone, but for some entrepreneurs this can be a very effective way of demonstrating your talents while learning on-the-job skills.

Since getting my auctioneer's license I have worked for three different auctioneers in the area.  All of these are future competitors, and they realize that, but they are also willing to let me showcase my abilities on their stage.  One of the principle auctioneers in our area allows me to work the ring for him and do about an hour's worth of bid-calling at each auction.  I receive no pay for this work, but I am getting great emperience in a real-world setting, and he introduces me at each auction as a new auctioneer so people know that I am open for business.  He has also hired me for an up-coming large auction he has scheduled.  Another primary auctioneer in our area has hired me for two auctions.  At one I was a ringman and at the other I was the cashier.  I had never done cashier work outside of auctioneer school so this was an opportunity to learn how to deal with the challenges of this aspect of the business.  An auction house recently opened in our area, and they've asked me to do help work their ring and I've done bid-calling there once.  They recently gave me a lead on an individual who contacted them wanting to sell some merchandise.  When I went to view it and talk with this individual she indicated she was now thinking of selling everything at auction.  I went back to the owners of this auction house, told them she was considering an auction, and asked them to contact her.  They told me to take the auction if I wanted, but I didn't feel that was fair to them and said I would be more comfortable if they signed it.  I didn't think it would be right to get a lead from them for one thing and then take away an auction from them in the process. 

Each of these are potential competitors, and the time will come when we will compete for people's business, but they are also colleagues.  I have good relationships with each of these people, and they know I will be fair in my dealings with them.  Because of that they are willing to give me a platform on which I can both showcase my abilities and hone my craft.

Depending on the business you want to start, this can be a great way for you to be real-world experience and show people what you can do.  That experience is worth more than a few dollars so don't think you have to be paid for that work.  I've done charity auctions and worked for free for other auctioneers, and I look at it as an investment in my future success in this business.  If you find people who are willing to help you in this manner be sure to give them your best efforts and be fair in your dealings with them.  And, in the future when you are successful, don't forget those who helped you and pass it on to someone else starting out.

Getting your name out

One of the challenges of starting a new business is getting your name out in the community.  You can purchase newspaper ads, but many people, especially younger people no longer read the newspaper.  Social media is good, but it is limited by the number of people you have in your networks and how willing they are to pass your information on to their networks.  Perhaps, one of the best ways of getting started is taking advantage of opportunities to network with others and tell them the story of your business.

It is difficult to crack into the auctioneer business in my area.  There are about 4-5 auctioneers who do that vast majority of auctions and dozens of other auctioneers ready to scoop up the remainder of the auctions.  I've ran ads in all of the newspapers in the surrounding counties and numerous people have told me they've seen those ads.  Unfortunately, none of them have resulted in any business.

Last night I had the opportunity to showcase my auction skills in front of about 100 people as I did a charity auction for a church.  They were having a dessert auction to raise money for the youth camp many churches use each summer.  In about one hour we had raised over $1,400.00 and had a lot of fun doing so.  People who had known me in one role had the chance to see me in a different role.  Of course, my hope is that if they need the services of an auctioneer they will give me a call.

A couple of months ago a friend asked me to speak at their local Rotary meeting about my reasons for becoming an auctioneer and the process it takes.  A couple of dozen business leaders were in attendance, and my friend told me later that my message was very well received.

These types of events are much more personal that anything else you can do.  It gives you the opportunity to meet people, learn their names, pass out business cards, and make a connection that can't be done through any other marketing you may do.  Too many people starting a new business put up a sign, sit by the phone, and wonder why it never rings.  You've got to go to the people; not wait for them to come to you.  You need a compelling story to tell them about your company, why you started it, and what value it will bring to those who use your business.  Quite frankly, that often takes time so it's important that you take a long-term perspective.

I always caution people to not quit their day job until their new business really takes off.  Regardless of how good your product or service is, it will likely take people some time to discover you, and you need a stable income to provide for your family.  I have a good position so I can be comfortable waiting until the auction business takes off.  If I never do an auction it won't impact our way of life, and that is a very good position to be in.  No worries.  No fear.  I can afford to network, do charity events, and get my name out to the public, and I'm confident that eventually this will lead to a growing auction business.

Starting right

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A couple of weeks ago I mentioned that I had received my auctioneer's license and was preparing to start an auction business.  Today I met with my attorney to discuss how I should structure the business.  He advised me to create a Limited Liability Company (LLC) that would help protect our personal assets in case there were problems in the future.  It costs very little to set up an LLC and it provides a lot of protection.  He suggested that if I wanted to save money I could do it myself online as it wasn't that difficult, but when I asked what he would charge me to do it I found out it wasn't much more.  I asked him to do it.

I'm all about saving money, and like most small business start-ups I don't have a lot of money to put into this endeavor.  However, I think there is value in knowing that the foundation for the company is being laid correctly.  I could save money by doing my own dentistry too, but I doubt it would be worth it.  I want this company to be set up correctly so why not pay someone who has been trained for this kind of work to do it, especially when it is such a minimal amount?

One of the mistakes I made in my previous company was that I tried to save money in places I shouldn't.  Penny wise and pound foolish I believe the old proverb calls it.  I want this new business to be started right so I've asked my attorney to do the paperwork for the LLC to ensure it is done correctly.  I began today pricing liability insurance.  When the state approves the LLC I will set up two bank accounts for the business: one for business operations and the other for an escrow account as required by state law.  I have started printing business cards and brochures and began handing them out to close friends.  Later this week I will order contract forms and other paperwork needed in the auction business so when I am ready to launch the business I will have everything ready to start. 

And it will be right from the start.  I will not make the mistake again of trying to cut corners that should not be cut in an effort to save a few dollars.  I learned that lesson from my first business.  If you want to know what other lessons I learned from losing that business be sure to read my e-book Mistakes: Avoiding the Wrong Decisions that Will Close Your Small Business. 

I'm launching a new business

This week I am starting a new business.  Late last year I began attending auctioneer school, and last week I passed our state exam and earned my license.  This week I will begin the process of starting an auction business.  This will be a very part-time career as I continue to serve in my calling as a minister, but I am excited about it just the same.  Although there are many licensed auctioneers in the state, many of them are not very active.  It seems that only a handful in most of the counties near me handle most of the auction business, and some of them are ready to retire and have already started cutting back on their work-load.  I believe this is a good time for a new auctioneer to enter the profession even if it will just be part time.

Auctions have long fascinated me.  As a young boy I was taken to a farm auction by my father who asked me to buy a corn planter he wanted.  He also worked off the farm and could not attend the auction, but he wanted to buy that planter.  He explained the strategy I should use in bidding and gave me a maximum amount to bid.  I ended up buying the planter for less money than he was willing to pay and found the process enjoyable.  In recent years I've been attending a number of auctions which led me to pursue my own auctioneer license.

Like many business people today, I also believe this is a good time to start a new business.  There are tax advantages to owning a business which could be helpful depending on how the tax laws change over the next year or two.  This is also a good time not to depend on just one source of income.  There remains much uncertainity in the financial and economic worlds due to the leadership failure that exists in Washington.  While some politicians try to convince the American public that our economy is coming back, most of us in the real world do not see much evidence of that.  Multiple streams of income provide the average American a safety cushion that is more preferable than hoping our government leaders will find a solution to the economic problems our nation has.

My previous experience at owning a business came from obtaining ownership of an existing business.  This one I will be starting from scratch, and already I feel an excitement as I begin that process.  I learned so much from our previous business that I will apply to this start-up which should help me avoid many of the mistakes I made the last time.  I'll keep you posted at how this business progresses.

If you would also like to learn from my previous mistakes you can find those discussed in my book Mistakes: Avoiding the Wrong Decisions that Will Close Your Small Business.

Who is really to blame when a business goes under?

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We owned and operated a small family business for fifteen years until we were forced to close it.  The last few years the company was not profitable, and it was a struggle to keep it open.  We continued to think things would turn around as they had during previous downturns, but that time we just could not turn the corner.  After an auction we had enough money to pay our creditors.  We were lucky.  Many who lose their companies are forced into bankruptcy, lose their homes, have their credit destroyed, and/or deplete their life savings.

The news continues to be full of stories of small businesses failing, and the owners point their fingers at a lot of causes.  The economy is bad, taxes are too high, there is too much governmental red tape, Obamacare, inability to compete with foreign-made goods, fiscal cliff uncertainty, too much competition especially with the big box stores, dishonest employees,, and a rapidly changing environment.  Of course, this is not an exhaustive list of reasons why businesses fail.

Each of these are a severe hindrance on small businesses, but are they really the reasons why a business fails?  The fact is that businesses fail in a good economy, and many small businesses continue to do well in our present economic downturn.  I agree that taxes are too high, but they are basically the same for every business, and some seem to prosper despite high taxes.  Every one of these reasons are a challenge, but some small businesses are able to meet those challenges and do well while others end up closing their doors.  The real reason a small business fails isn't due to outside challenges; the real reason is internal.  The owners failed to make the decisions that were needed for the company to prosper despite the challenges it faced.  In a good economy our mistakes don't hurt us too badly, but in a poor economy our mistakes cause us major problems.

When our business was struggling I blamed a number of issues that were all true, but each of them were outside my control.  It wasn't until later I realized that the real reason our company closed was because I failed as a leader to make sound business decisions and operate the company in a way that would ensure its profitability.  I could write a book about all the mistakes I made as the president of our business.  In fact, I did.  It's called Mistakes: Avoiding the Wrong Decisions That Will Close Your Small Business.  For thirteen chapters I describe in detail the mistakes I made that led to the closing of our business.  In each of those chapters I also describe the lessons I learned that, if they had been applied at the time, would have led to better decisions on my part.

Success and failure are both inside jobs.  You can't depend on Washington to bail out your small business.  That is not going to happen.  You can't even depend on them to not do something stupid that will add even more risk to your business.  The big box stores are not going away.  Taxes are not going to go down; in fact, it is likely they will continue to go up because Washington is convinced we are not yet paying enough to fund their programs.  If you want to ensure your company's success you have to work smarter, and one way to do that is to learn from the mistakes of others. 

That's why I wrote this book.  I want to help others avoid the mistakes I made so their businesses don't fail.  If you started your company it was because of a dream you had.  Perhaps you are now the head of a business that has been passed down from other generations, and you want to keep their dreams alive.  I believe this book will help that happen.  It is currently only available on NOOK devices and can be ordered here.

The personal investment

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Today I had lunch at a new business in our community that recently opened its doors.  It is an art gallery with a lunch area in the back that is owned by some relatives of mine.  I had not been there yet and decided today was a good day to try out their menu.  The food was excellent and the art work was exceptionally nice.  My cousin came from the upstairs where he had been painting, saw me, and took me on a tour of the place.  Upstairs they have a guest room that is really nice for our historic community and a large banquet area.  He is finishing another section upstairs that will be their office.  We went outside where he showed me the old windows high up on the front of the large building that had been covered up years ago with boards.  He said he had spent three days scraping and cleaning those windows so he could paint them and restore the building to more of its original look.  Since buying the building late last year he has spent every waking moment cleaning, painting, and preparing it for its opening.  His pride was evident in his voice and in his eyes, and he should be proud.  The building, the food, and everything about their business was excellent.

This personal investment is what it takes to create a successful small business.  You cannot start a business and manage it half-hearted.  You have to go all-in or stay home.  We didn't talk about their financial investments, but I would assume they have a fairly large financial investment in this business, but he has even more of a personal investment in it.  He and his family have poured everything they have into making this business successful, and I believe it will succeed because of that personal commitment.

Compare that to what I see when I go into some smaller businesses today.  I walked into one shop recently and the person working there was sitting behind the counter talking on her cell phone. She never acknowledged by presence.  While I was there another customer came up to pay for her purchases and the employee rang her up while still talking on her phone.  About that time another customer came up with some items to purchase, so the employee finally said to the person on the phone, "Well, I HAVE to go, I have a customer."  (Emphasis mine)  I don't know what the other customer thought, but my impression was this employee was saying to her friend that she HAD to hang up because she HAD to wait on some customers.  I thought to myself that I didn't want to interfere with her social life so I wouldn't buy anything, and I left. 

There was no owner in sight.  I understand the owner cannot be present every moment, but he or she obviously had not taught this employee anything about customer service.  This was a business that needs the owner there every moment at least until he or she trains the employees about proper customer service.  Unless this owner gets more involved in the business it won't be open for long.  People have too many options and will take their business elsewhere where it will be better appreciated.

How committed to your business are you?  What are you willing to do to make it successful?  If you have a 9-5 commitment to it you may as well close up shop and find a job because that's all this is to you.  At least with a job you won't have the headaches that go along with ownership.  The successful businesses are the ones where the owner is all-in and completely committed to seeing it succeed.  I hope that describes you.

Staffing a start-up

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A common mistake some entrepreneurs make when they start a new company is spending money on things they don't need.  I recently heard a caller to a radio program explain that one of the reasons he was having financial problems was he had bought a new pick-up truck for the carpenter business he was starting.  He had made virtually no money in this new enterprise, and he spent $30,000 for a new pick-up truck.  The radio host told him that was a huge mistake, and the business owner responded that he had to have a truck to do his construction business.  The radio host agreed that he needed a truck, but he didn't need a $30,000 truck he had to finance before he ever got his business off the ground.

New businesses make the same mistake when they purchase or rent office space or equipment.  They overspend on these items before they have any cash coming in thinking they have to have all the latest technologies and a prestigious office.  Actually, unless you are a retail store you may never need to meet a client in your office.  When I think of many of the service people with whom I do business I realize I've never been in their office or even know where that office is located.  You can work out of your garage or your basement when you start out.  For only a few dollars a month you can get a post office box for your business mail and add a second business line that comes into your home which will transfer your calls to your cell phone.  Most people will assume you are working in your office when they call. 

Another unnecessary expense some start-ups encounter involves their staff.  It is doubtful that most new start-ups need to hire a full-time person when the business first begins.  Many entrepreneurs do not realize all the expenses such a hire creates.  This person will need supplies, equipment, and training.  There will be additional taxes due with such a person now on the payroll that will eat into those early sales.  There are better options that hiring a full-time person right off the bat.

1. Get a virtual assistant.  There are now numerous companies providing virtual assistants who will handle the administrative tasks you need to avoid so you can be more productive with your time.  These will cost your new business much less than hiring someone, and if they don't work out you simply end your agreement.  You don't have to worry about unemployment compensation or any of the other issues that goes along with terminating an employee.  There is one thing to make sure of before you get a virtual assistant.  Have a detailed list of what you need this person to do and ensure that is clearly communicated before signing any type of agreement.
2. Get a part-time person.  Maybe you have enough administrative work for someone to do for 10-20 hours a week and you're not comfortable with a virtual assistant.  A part-time person might be the best option for you.  I know a person who did some work for a local professional in her home during the evenings on a part time basis.  The work was such that it could be done at her convenience which made it appealing to her.  
3. Hire a temp.  The benefit of having a temporary employee is you only have to worry about paying a salary to the temp's agency.  They handle all the taxes for the person.  You write out one check each week for the person's services, and you don't have to worry about it after that.  A second benefit is that you can hire the person for a particular project, and when that is completed his or her employment with you is completed as well.
4. Use interns.  If you are located near a college or university there may be some students willing to do intern work for the experience and so they can add it to their resumes.   Interns usually need a lot of supervision but they also bring a lot of energy to the position.  In some cases, you may find a great future team member at little or no financial cost to you.

Starting a new business requires a lot of time, and it may be appealing to hire someone to help.  I agree that it does take a lot of time, but chances are you still have more time than money.  You can't afford to pay someone to answer the phone for you.  Answer your own phone.  Order your own supplies.  Open and close your business yourself.  If your idea for a business is a good one the day will soon come when you will need to add team members.  At that point begin to add part time people or follow the suggestions listed above.  If that is successful it won't be long before you will be adding people, but at that point you should be able financially to do add people who will contribute even more to your business' bottom line.