Mistake #1: Buying the Wrong Things



 

You've decided to go into business. You're excited. For many new business owners, going into business means buying a fancy desk and other office equipment. This can get expensive very quickly.

 

The hard truth: If you don't have customers, you don't have a business. You have a hobby. Don't spend money buying fancy gadgets until you have a client base.

 

Solution: Buy the minimum necessary to run your business. Then find a way to let your customers know that you offer what they need to buy. Find out where your clients are, and market to them there. If your clients all go to home improvement stores, advertise there. If they visit your local bank, put up signs there. Get customers before you spend money on equipment you don't need.

 

Mistake #2: Trying to Sell to 'Everybody'

 

Ask a new business owner who his or her product is aimed at, and 90% will say "Everyone, because everyone needs my product."

 

The hard truth: When you try to sell your product to everyone you are really selling to no one. People have different needs. And they buy things for different reasons. What will sell your product or service to one client won't sell it to another. And generic marketing appeals to no one. You need to appeal to their key desires if you want the sale.

 

Solution: Pick the type of person or company you will serve, and find out everything you can about their wants and desires. When you know what they really want, you can position yourself as the best person to give it to them.

 

Mistake # 3: Trying to Convert Unbelievers

 

Most new business owners are so anxious to make a sale, they will spend a lot of time selling to everyone they meet. If someone doesn't seem excited about their product, they spend a lot of time trying to change the prospect's mind.

 

The hard truth: Trying to sell your product or service to someone who isn't convinced of its value ahead of time is a waste of your time.

 

Solution: Market to people or companies that already use your product or service. They already know they need what you have because they are buying it from someone else. Now you can spend useful time showing them why you are the best person to solve their ongoing problem.

 

Mistake #4: Not Qualifying Clients

 

Many new business owners, anxious to make a sale, any sale, will pitch their product and service to anyone who seems to need their product. The client may find your price high, but you figure you can talk him into giving you the price you want.

 

The hard truth: If a client can't afford you, he or she will never think you are worth the money you are asking. Even if you convince the client to pay more than he or she wanted to pay, you will both leave the relationship dissatisfied. You will both feel cheated.

 

Solution: First find out if your price range is reasonable for your location and the types of services you offer. You can do this buy calling up your competition and posing as a customer to get quotes.

 

Then find out the client's budget ahead of time. If the client tells you that your bid is too high, find out how much they think the job is worth. If there is a big difference between the two numbers, then move on.

 

Opening a new business is exciting. But don't let your excitement interfere with sound business judgment. Businesses that want to make money find out who their ideal customer is, and spend all of their time marketing to them. Do this, and you will soon have a business that brings you satisfaction—and a nice paycheck.

 

In the last article in this series, we will discuss the most sensible way to make the switch from employee to full-time freelancer.