What are your entrepreneurship tips?

Think like an entrepreneur, but make decisions like an investor. Your creativity and passion should motivate you and lead the company. But when it comes time for decision making, approach it as someone looking to invest their money in your company; don't make decisions based on the fact that it will cost more than you feel comfortable spending (if your bank account is funding the venture). If you need to bring on additional capital from external sources, do it!

Here are a few of my favorite tips.

1. My business card goes in every bill I pay every time I pay it. The person opening that payment may need me, my products or services.

2. Web site address on your voicemail or answering machine. They are calling for a reason. Send them to your web site where you can re-enforce your credibility.

3. If you have vehicles with the company name on them, and you don't work on weekends, park them legally in high traffic areas so people can start learning your business name. Phone # is always on the back not just the sides.

4. Your "yellow page" ad should have the following, or some variation of it, "For discounts and unadvertised specials visit www.yourcompany.com." Get potential customers out of the yellow pages and away from your competition.

5. Always, always, always, call customers by name as soon as you know the name. When you meet them, when you take their check or credit card. Turn a cold transaction into a warm visit that your customer will want to repeat.

6. Empower your employees. Nothing is worse than an irate customer coming in while the boss is at lunch. Customers almost always want one of three things, 1. make the problem right, 2. give another product of equal or greater value, 3. Refund their money. - every employee should be able to do one of those three things without management approval. Train your people how to handle these situations.

7. Answer the phone with personality. When someone calls and wants to know your hours do you think that's all they want to know?? No, they called to look or buy something. Your phone person should be telling them about specials or asking what time can you come in. If they are calling you chances are they are also calling your competitors. Give them a reason to make sure they come to your business. Give them your web site for coupons or discounts to bring in with them.

8. Really look at your competitors. Where are they better, where are you better? Use these differences in your advertising. If you are new you are "cutting edge" versus your older, out of touch competitors.

9. Get involved in your community. Kiwanis, Lions, Rotary, etc. These groups attract the "movers & shakers" in your community. These are people who will recommend you to their friends and neighbors. If you can get testimonials from them .. do it.

10. Key to success. Find people who are successfully doing what you want to do and do what they do. When you read about a successful person.. call them up. Ask if you can get a few minutes with them. Most will talk to you some will not. Learn from the ones that will.

I talk with a lot of new business owners who started their business by advertising their cell phone number...don't do this! Get a virtual phone number that routes to your cell. Then make sure it sounds like a business when people call. I use a Call Announce so the caller knows they've reached my business then it plays music as it reings my office then my cell. When I answer I hear that it's a business call and I have to press one to take the call. This keeps it from going to my personal voice mail. And the number does not ring after hours. I could go on but get a virtual number.

In my opinion there are 3 reasons small businesses fail.

1. Forced Discipline - From the time we are born and throughout most of our working life, other people make our decisions for us. Parents, teachers, military officers, bosses, etc. When the time comes to make your own decisions many people have a hard time with that kind of stress.

2. Associations - Most people will take advice from the guy on the next bar stool before getting advice from a credible source. Find and follow the advice of people who have successfully done what you want to do.

3. Vision - right now you have little or no business. That's discouraging and may be a business killer to many if it lasts too long. You must see your business as you want it to be; not like it is now. Few customers and low income is part of the process. But keep your eye on the end result.

As you can see business success in often more emotion and attitude than it is following a "cookie cutter" method. I would recommend reading all the business biographies you can find on successful business leaders and entrepreneurs. You will find great strength in the obstacles they overcame.

The quest for entrepreneurial success begins with a vision of what it is you want to achieve. To accomplish this, my rule of thumb is to envision, plan, execute and attain. Do you envision your objective? Do you plan how you are going to get there? Or, do you just simply take that ‘road trip’ mentality, jump in the driver’s seat of your business, and head down the road hoping you will see what you want, and be in a position to attain it. Of course the problem with this scenario is that you are not likely, and in fact most likely will not attain what you are looking for, seeking or aspiring to.

In business, you must envision the market, identify your objective, develop your strategy to achieve your objective, plan how you will execute your strategy, then work your plan to attain your winning objective. First things first, is a Business Plan, which is the single most important strategic planning document you will develop in establishing and growing your business. It is the essential document for planning your business operation and is necessary to acquire funding. How your business plan is developed is certainly up to you.

Either you can take the time to develop your plan, or you can work with one of many professionals and organizations that provide business plan services from development to review. What is important for you to understand is that a business plan is required by commercial lenders, venture capitalists, individual investors, franchisors, and the Small Business Administration [SBA]. So, not only do you need a business plan to map out the roadmap for business success, it is a major requirement for obtaining a business loan. The Small Business Administration [SBA] reports that:

• 50 percent of all small business fail after their first year, 33 percent fail after two years, and nearly 60 percent fail after four years.

Reasons for failure cited by the SBA include: over expansion, poor capital structure, over spending, lack of reserve funds or too little Free Cash Flow, failure to adjust to market changes, underestimating competition, poor business execution, poor business location, and an inadequate business plan.

Fundamentally a business plan defines your opportunity, product/service including keys to success and risks, provides an analysis of your market, details your competition, lays out your marketing plan and strategy for acquiring customers/clients, identifies key management and what their roles will be, and provides important financial information. It includes the core areas of a strategic plan however; it is a streamline version in that it should be succinct, limited; in my opinion to twenty pages, and used to attract various levels of funding. As an entrepreneur, once you have acquired your necessary funding, the business plan should be the basis for developing your corporate strategic plan focused on growing your business.

Here is a quote you might like which puts things into perspective as a fledging entrepreneur: "The cover-your-butt mentality of the workplace will get you only so far. The follow-your-gut mentality of the entrepreneur has the potential to take you anywhere you want to go or run you right out of business--but it's a whole lot more fun, don't you think?" - Bill Rancic

I have given some thought over the years on how to choose the right venture to invest your life in. As the second year of this recession drags to an end there seems to be rising interest in starting new businesses. Here are the litmus tests I apply to new ideas.

1. First, is it truly an entrepreneurial venture or is it a form of self employment? If a doctor or lawyer strikes out on their own that is not really what I consider entrepreneurial. The businesses they start are hard to scale and rely on their own ability to provide services. Same for lawn care, house painting, plumbing.

2. Entrepreneurship is about inventing. Recognizing, discovering, or inventing a new solution to a problem and building a product and a business to solve it.

3. It takes capital, preferably OPM. Only with other people's money can you leverage your idea quickly. Pick those other people well, they should also bring contacts, business experience, and more money!

4. You will be in the sales and marketing business. I have observed the best business to start, if you are creating something physical, is one where average selling price of the product is around $35,000 . That means you can invest real resources into each sale and expect to gain back at least that investment. If you sell a $2.99 new gizmo you have to work through Wall Mart and will never see any cash until you are selling millions of products which requires millions of investment.

5. There are several things that have zero marginal costs to produce. These make the very best opportunities at the lowest investment of capital: eBooks, digital music, and software. Each requires investment of course, but the 101st copy costs nothing to produce. COGS (Cost of Goods Sold) = Zero. It was not until I was at Webroot Software that I saw this in action. The team in charge of the online business could tweak a few parameters (rebates, affiliate margins, bundles) and generate tens of thousands in new revenue the very next day. I once visited the offices of Entrust Software in Ottawa. After getting a tour of the building my host said "and here is our manufacturing facility." He showed me the mail room! They had a PC set up burning CD's, boxes, manuals and a postage meter. Their selling price was in that $35K range too. Nice business.

I coach a lot of entrepreneurs so I could give you lots of tips. Here's one that's often overlooked. Make an honest assessment of your strengths and weaknesses. Next, identify which of your weaknesses are going to cause a problem. Find a way to get those things handled so they don't make you nuts or sink your project. For example, if you don't like details, find someone to do some or all of them. You might hire someone or maybe you could find a family member or an intern who could do it. Personally, I thought I could make myself do the things I wasn't good at or didn't like. Didn't work. Then I learned how to delegate effectively and I'm MUCH happier. (and more productive)

I understand what you're getting at Greg, but it depends on the business. My job is consulting bars and restaurants on social media and giving tech support for my company's syndication platform. As part of my service, I offer my clients my cell phone, and tell them to call me 24/7. They don't abuse it, and they like the personal touch. My voicemail is my business recording. I could see an argument being made for keeping a second phone for this purpose, but so far I haven't regretted it!

Richard's answer is spot on but I would add a third item to the list. Document your service delivery so that you can create processes that lead to improved quality each time you fulfill a service order. Most businesses don't think about measuring quality until there is a problem. Your first customer is the ideal place to start.

In the planning stages, make a list of all the jobs/tasks that must be done to make the business successful and match these to your areas of expertise. Be honest about evaluating your competence to handle these tasks. Any tasks where you don't have the competence will need to be done by others. Who? Employees? Outside services? Write this into your "private" draft business plan.

Beware of an entrepreneurial business where you lack core competence and be very honest with yourself about this. "I'm going to manage and others are going to do the actual work" is probably at the base of the statistics cited for many business failures.

Write a detailed business plan for yourself--regardless of how you write the "public" business plan Sandy Graham refers to. Your "private" plan should be as many pages as you need to put everything down in detail.

Your "public" business plan--the one you show others, is a condensed and edited version of your "private" business plan.

Your private plan should include details of how you plan to answer the phones, who design and maintain your website, who will handle tasks like billing (and on what schedule), what your internal as well as external paperwork (electronic or paper) will look like, etc. Who will write your letters, answer your e-mail, buy the goods and equipment you need, track inventory and so forth. Who will handle marketing? Who will handle sales? In the end, you will delegate many of these jobs/tasks but you need to at least write detailed job descriptions for those employees/contractors/outside services.

If you spent 15 years in a "corporate" setting, you probably have spent a lot of time reducing everything to streamlined "bullet point" reports and presentations. And for a "business plan" you use to attract funding, etc. that's correct. And yes, you need a "strategic plan" focused on growing your business. But you also need that "private" plan that delves into the detail of how you are going to get things done and who is going to perform the tasks and how.

[Should you, for example, work from "paper" or use electronic record-keeping? If the latter, which system(s) and what will implementation cost? Who will train others to use the systems properly, etc. etc.? How do you encrypt? How do you back-up and on what schedule? When and how do you test your back-up schemes to make sure that they work the way they are supposed to/the way you think they will? What is your disaster recovery plan for those electronic systems? Remember that in a corporate environment, other people worry about these issues. In your new company, you have to think about these issues beforehand because you need to make sure someone is handling them. If you think about this in advance, you won't be blindsided once you've taken the plunge into your new venture.]

This answer could be really long, but the shortest and probably best answer is: Make an appointment with your local Small Business Development Center. They will break it all down for you in chunks that are easy to digest and easy to implement. Do yourself a BIG favor and start there.

1. Disrupt the market
2. Go big or go home
3. Network
4. Disaster planning
5. Maintain flexible persistence.
6. Seek honest feedback for continuous improvement
7. Be everywhere.
8. Culture is key

Thanks for your advice, Adam. I'll do my best to approach it like an investor as well. Great advice!

My pleasure, good luck!

Richard Stiennon hit it out the park with his response.

I would add a couple things. 1.) Have a goal and figure out what you need to do to accomplish that goal. It might involve taking small steps, but have a final goal that you want to accomplish. 2.) You are going to be diving in head first with your new endeavor. Make sure you understand that you might be putting a lot of things second to your business because your business won't get off the ground without a lot of hard work which includes long days and long nights.

Good luck!

Most new business owners fail to separate their business credit from their personal credit. New business owners gather up what financial resources they have available to them to place money into their business bank account. They use their savings to do it, they sell assets, they borrow money from friends and family, etc, but some how they come up with initial money for their business.

Typically they place these funds directly into their business bank account and start spending ... this is the Largest mistake new business owners make.

These business owners could have taken the same amount of money and placed it into a Certificate of Deposit at a bank that offers business credit reporting business loans. For example, if a business was to deposit $25,000 into their business bank account, they could have taken out a $25,000 CD and received a $25,000 business loan that would have reported to Experian Smart Business Reports, Dun & Bradstreet, and the Equifax Small Business Financial Exchange.

The net result is all three major business credit files get opened and the business itself is now on the credit radar of many other lenders who know how difficult it is to obtain a bank loan. It is also creates what is called “Comparable Credit”, as now many other business lenders and vendors will feel comfortable also offering $25,000 lines. For example, other organizations such as for auto loans and computer financing will approve larger lines.

Most business lending banks will release the CD security after 24 months of successful payments, which is the same amount of time it takes for a business to fully optimize their business credit scores.

Dan, I commend you for your desire to take control of your future and destiny. I think you will find it highly rewarding and it is good that you are seeking advice and counsel on forums such as this. However, starting a business is like walking through a minefield blindfolded with cement boots on.

There is so much to consider that a forum such as this will not do the discussion true justice.

I have started, grown, sold or been a part of 14 businesses (some highly successful, others dismal failures) and have accumulated huge book of "Lessons Learned" but to try and share it here would consume far too much real estate.

If you have an interest I would be happy to share some of my experiences, shoot me an e-mail at lchaug @ verizon.net

Hi Stewart,

you entrepreneurship is going to live till you have cash. Even if it is logical lot of people neglect a cash flow till it is to late.

Regards, Daniel