Should I start my own business?
There are many great reasons for starting your own business – greater independence, flexibility of working, the possibility of earning more money, more varied work and the potential to grow your business as you become more successful, to name just a few. However, it’s a major step and there are risks, so it’s not for everyone. Some of the things that you’ll need to consider carefully include your security of employment, how you will find customers and ongoing work, whether you have sufficient funds to start your new business, your ability to cope with uncertainty and whether you feel able to deal with the inevitable administration that comes with running a business.
How do I attract customers?
In simple terms, you’ve got to raise awareness and become visible quickly! If customers aren’t aware that your business exists, you can’t expect them to hire you. So, your first steps in raising your profile might include – getting a professional website, social media accounts and some nice business cards / stationery. Networking is also a really good way of getting your name out there. It’s a big topic which we’ve covered in more detail below.
How do I start networking?
Networking is simply about widening your circle of business contacts to share common interests and information that hopefully will lead to you finding greater work opportunities. Networking can be done both face to face and online. Look for local business groups to get involved with where you’ll get advice and support from like-minded people who will often also help recommend your business to others.
Building up your network on social media is really important. If you haven’t already done so, sign up to Facebook, LinkedIn, etc., where you can create a page for your business and let all your contacts know about your new venture.
Click this link https://www.buildingonline.co.uk/ to join Building Online, the free specialist business network for the UK construction and built environment community, where you’ll be able to raise your profile, build your network and find new work opportunities.
Do recommendations really work?
Absolutely! Recommendations are really powerful. Once you’ve found your first few customers, delight them with your quality of work, attention to detail, tidiness and courtesy. As the saying goes “always under-promise and over-deliver!” You’ll be amazed at how quickly word gets around once people tell their friends about what a great job you did for them. Wherever possible, get your customers to provide you with positive reviews on your social media pages and don’t forget to add a ‘Testimonials’ page on your website.
How can I stand out from the competition?
Think carefully about what it is that makes you and your business unique. Are you able to provide a better quality service or something different to your competitors? If so, when describing what your business does on your website, social media and promotional literature, spell out how exactly how and why you can do this. For example, are you trained to a higher level than most? Have you won any awards or commendations? Can you offer a highly specialist service that others can’t match? Do you use a unique process or special quality materials?
Sometimes, it’s the little differences that will help get you the job, such as a guarantee that you will always treat a customer’s property with respect and tidy up at the end of each day. It’s an example of something very simple to do that is highly valued by customers. Amazingly, not everyone bothers to do it!
How much should I charge?
In the first instance, you’ll need to have a good handle on what the job is likely to cost combined with an understanding of a sensible margin to add. A bit of research will help you come up with a basic pricing strategy. Find out what other businesses are charging for similar services. If you’re aiming to provide something a little different to the competition, then it’s possible that customers might pay more for your services, but they’re unlikely to pay significantly more if you’re offering pretty much the same as everyone else. Ask around, speak to your friends and colleagues, and politely ask customers what their budget is and how much they’ve been quoted elsewhere.
How do I calculate my profit?
There is something to be learned from the expression “Turnover is vanity, Profit is sanity but Cash is reality!” But what exactly does this mean?
Turnover is simply the total amount of sales that your business generates over a set period, usually measured annually. For example, if you completed 100 jobs during the year and charged £500 per job, your annual turnover would be £50,000.
Profit is (hopefully!) the earnings that you are left with after deducting all your expenses from your turnover (rather than a loss, which would be the case if your expenses exceeded your turnover!). So, if each job cost you say £200 in materials, tools, travel and other expenses incurred in undertaking the work, then your ‘gross’ profit per job would be £300 (£500 – £200), meaning your annual ‘gross’ profit would be £30,000. Be aware though that in order to work out your ‘net’ (bottom line) profit, you’ll need to factor in other general costs of operating your business including ‘overheads’ such as rent, phones, IT equipment, business stationery, etc. And of course, don’t forget taxes! As well as keeping accurate records, you will probably need to seek some advice from an accountant or other financial professional to help you understand and manage your finances properly.
Cash really is reality because, whilst it’s great to have healthy turnover and profits on paper, if you’re struggling to get customers to pay you the money they owe in good time, you won’t be able to keep operating for very long. Cash is the lifeblood of your business. Try to get paid as quickly as possible and make sure that your payment terms are made clear to your customers and are agreed in writing before doing any work.