You’ve decided to set up your own business. Good for you. After all, how difficult can it possibly be?
You’re planning on doing something that you’re extremely good at and love aren’t you, so it’s bound to work? Like many of us who’ve gone before you, you might be quite naïve, looking at it through rose-coloured spectacles.
Either you have years of experience in corporate or it’s a hobby that you’ve been doing for a long time. Everyone tells you you’re fantastic at it and why don’t you go into business. That’s all well and good but have you really thought things through?
You’re fed up with your job. Perhaps you’re working for a mean-spirited boss, there are no opportunities for promotion or you just don’t like the office politics. I get it. I’ve been there. So the timing is absolutely perfect.
One thing’s for sure. It’s easy to find Government-funded training in how to set up your business and I’m certainly not qualified to write about that, nor would I wish to. Because that’s all just the process of it and not my passion.
YOU ARE A BUSINESS OWNER.
The two key words are BUSINESS and OWNER.
What I intend to address in this article is the shift that must occur from employee mentality to an entrepreneurial mentality and that is equally, if not more important than anything else.
I make no apology for my direct and no-nonsense approach, as being fluffy and wishy-washy will not serve you at all. My aim is to open your eyes wide so you know what you’re letting yourself in for. The more you understand at the outset, the less mistakes you are likely to make and therefore the more successful you’ll probably be.
If you’re like many other entrepreneurs, you love your products and services and you want to go into business to share them with the world instead of having some miserable, incompetent boss breathing down your neck. Well that’s true; however, it’s just one aspect of it.
Lesson No. 1.
The truth is that you are no longer a lawyer, an accountant, a coach or a widget producer. You are a business owner. Let me repeat that in big letters.
YOU ARE A BUSINESS OWNER. The two key words are BUSINESS and OWNER.
So what does this mean?
Not only is there a whole new skillset for you to learn but you must also develop a massive shift in your thinking.
Whether you like it or not, it’s vital that you really get this sooner rather than later. You’re no longer an employee. You’re running a business and if you don’t realise this very early on, you may struggle or even fall at the first hurdle.
I remember a marketer I worked with on my niche telling me that I wasn’t a coach, I was a marketer. I’ll admit that I wasn’t very impressed at the time and not sure that I really took it on board until much later on.
Get this at the outset and you’ll definitely be ahead of the game.
Lesson No. 2
You must forget the salary you earned in your previous job because even if you were earning good money, it has no bearing on how you price your services.
Services should be priced on the value they give to the client. If you charge based on what you earned as an employee, you will probably be dangerously undercharging for so many reasons:
- As a business owner, even if you don’t have premises, you do have overheads. If you’re going to make a profit, those costs must of course be taken into account.
- How many hours a week will you be doing work that can be invoiced? This one is a biggie. Unless you have a whole team of staff taking care of marketing, sales, administration, accounting and so on, you have to spend time (unpaid) doing all of this yourself.
And of course if you have staff, you have to pay them!
Charging what you’re worth is my area of expertise and if you’d like to read more about this, you can go to my LinkedIn profile and read articles, posts and watch videos.
If it’s a product you’re selling, it’s probably easier in some ways, because there’s usually less emotion involved than with a service, which is so personal.
By the way, start as you mean to go on. The mind-set I have noticed with those new in business is to charge low in the belief that this will make it easier to get clients. Sure you may pick some up. However, what quality of clients are they? Are they the sort who cause you a shed load of problems and want something for nothing? If so, are they really the sort of clients you want long-term? If the answer is no, then why would you want them short-term?
Some time ago, I coached a lady who had been running her own business for 16 years. She is really good at what she does. However, when I met her, she was really poor at charging and managing her clients. I discovered, in my first session with her that part of the problem was that, despite being in business for 16 years, she still had an employee mentality! I soon cured her of that.
Are you starting to see the shift you need to acquire?
Lesson No. 3
You must take 100% responsibility for everything that happens in your business. There’s no one else to blame. No boss, no co-workers, just you! And in the initial stages, there may only be you to solve all the challenges which arise too. Having said that, outsource as much as you can as soon as you can. For example, right at the beginning, I outsourced my book-keeping, tax returns etc. Why? Because it really doesn’t light my fire and I didn’t want to spend my time doing that.
If you’re someone who is charging your services out at say £150 an hour, it actually makes no sense to spend your time doing book-keeping which should cost no more than £25-£35 an hour. And the same principle applies to other mundane tasks too.
Do you see?
Some final observations which I think will stand you in good stead.
- Setting up in business can often be an emotional roller-coaster. Don’t get me wrong, I could never go back to working for someone else, nor would I want to.
- You must also embark on a journey of self-discovery and continually become a better version of yourself. Having a can-do attitude and unshakeable belief are key to becoming successful.
- Be disciplined and balanced in your approach. Make sure you’re looking after yourself properly – eating healthily, drinking water, exercising, meditating and having fun. Don’t allow work to be all-consuming as that’s the slippery slope to burn-out.
- Even if you’ve done your homework before you set up your business, you will still make mistakes and fall down many times. It’s OK. Just know this. When you fall down, the trick is to see how quickly you can get up again. Rectify what was wrong and move on. Letting go is a valuable skill to learn.
- If you like certainty, then you’re on the wrong planet. Whether you’re employed or self-employed, there is no certainty, apart from, as the old adage goes – death and taxes!
- And finally, take a leap of faith and go for it.
Vanessa Ugatti, the True Worth Expert and author of Amazon Best Seller, True Worth: How to Charge What You’re Worth and Get It specialises in helping service-based professionals generate more revenue ethically without having to get more clients, do more work or compromise their value or values by enabling them to charge their true worth. This results in more financial peace of mind, security and a better work-life balance.