Five mistakes I made in the first year of business

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Maybe it’s because it’s almost back to school time, but I’ve been doing a lot of reflecting in the past week. I’ve been thinking about what it was like during the first few weeks and months of being in business full time. It was an equally exciting and frightening time.

I had a business and marketing plan and was reasonably confident I would succeed. On the other hand, I didn’t really know I would succeed.

I was also venturing into new territory: creating a website from scratch; juggling business and family; having to be 100 percent responsible for my income – an income that was very unpredictable. And in spite of years of working in marketing and promotion, I found that marketing my own business was an entirely different kettle of fish.

Looking back at my first year in business, I see I made a lot of mistakes. If I had avoided them, I might have gotten to where I am a lot sooner. Here are some of my beginner mistakes:

Not being aggressive enough in marketing

People often say, “It’s just business. It’s not personal.” But when you’re a solo-preneur, selling a service, marketing yourself is personal. It’s all about you and the results you provide. And for many of us, this is very difficult. We’re taught not to brag, not to toot our own horn. And yet, as an entrepreneur we need to do just that.

When I say I wasn’t aggressive enough in my marketing, I’m not suggesting I should have been in-your-face shouting “buy from me”. However I did need to stop being so timid. At networking meetings I needed to proudly state what I do and then seek out new people to meet. I needed to get on the phone and talk to people. Passively waiting for them to come to me doesn’t work.

Being afraid to spend money

In the beginning of a business it certainly is a good idea to be thrifty. Don’t spend money when you don’t have to. Make do with second hand furniture, a home office, your existing computer.

However, if you’re afraid to spend money you need to be spending, it’s just going to hurt you in the long run. In my first year in business I was too thrifty in about three areas.

Scrimping on Training

First, I didn’t spend enough money on training. I knew there were gaps in my knowledge but I was afraid to spend money. And I’m not talking about spending thousands of dollars registering for a seminar and then paying for airfare and hotel. I’m talking about books!

Looking back I shake my head. Why did I think spending $20, $30 or even $50 on a book would break the bank? There are a couple of books I bought in my second year of business that moved me forward by leaps and bounds. If only I’d stopped being a Scrooge sooner.

My home office

The second place I was too thrifty was in my home office. When I started out I was using the family computer and desk as my office. I was sharing it with my husband and son. This meant I couldn’t leave work out because someone else might move it. It also meant I was always fighting for computer time. Sure I had from 9 am until 3:30 free, but you can’t start a business on 6.5 hours per day. When I finally got a second computer and set up my own office space, I really became more professional. And was able to take on more work.

Hiring help

The third place I needlessly scrimped was on hiring help. Actually, this is something I still struggle with. My husband used to be a computer technician so I thought I could rely on him to provide tech support. The problem is you get what you pay for. Because he was doing it for free, when I needed tech support, it came at his schedule, not mine. And even though he kept promising to learn enough to help me with my website, he never did.

I think getting free help from your family is fine – as long as you don’t need to depend on it. One thing I’ve learned is that relying on my husband for tech support is fine if I run into trouble on a Saturday afternoon. However, it’s far more efficient – and better for family harmony – to hire someone else to do bulk of the work.

Confusing being busy with accomplishing something

In the early months I made darn sure I was sitting at my desk by 9 am and was there until at least 3:30 (when my son got home). But just because I was at my desk doing “work” doesn’t mean I was accomplishing anything.

The most important thing I’ve learned is that not only do I need to set annual and long term goals, but each day I need to take actions that move me closer towards these goals. Taking one or two steps towards a goal is much more important than getting my bookkeeping or filing done. I’m not saying that those things aren’t important; they are. They’re just not as important.

I mentioned that I had a marketing plan and a business plan when I started. The problem is I didn’t use it to plan my days and weeks. Too often I was running around keeping busy without actually doing anything to achieve a goal.

Forgetting about the money

Whatever your reasons for getting into business, the primary reason is money. If you’re not making money after a reasonable period of time, you have a hobby not a business.

In the early days I didn’t spend enough time tracking money coming in and going out (cash flow). And I didn’t check my cash flow against my projections. I didn’t notice immediately when my income went down. As a result, I didn’t adjust my marketing in order to increase sales.

Perhaps if I had kept a better handle on the money, I wouldn’t have been so afraid to spend it.

Not knowing when to walk away from a client

In my first year of business I had a client who nearly sunk me. The most frustrating thing about it is there was that little voice in my head telling me he was trouble – right from day one. But I didn’t listen to it. It was an exciting project – editing a book. I’d never done that before and thought this would be a great opportunity for me to expand my experience. Also, I needed the money.

The first warning sign was negotiating the price. I gave a fair quote based on my hourly rate and what the industry standard rates were, taking into account my inexperience. He said it wasn’t acceptable and talked me down to half my quote. Bad start.

Next we agreed to do a sample chapter to see if we could work together. He told me to go crazy and not hold anything back – to edit as much as I saw fit. So I did. I gave it my best shot and didn’t leave anything that might be questionable. I fixed grammar mistakes, shortened long paragraphs and tightened up the prose. When I turned it in to him he fought me on every change. Even though English wasn’t his first language, he even fought me on grammatical errors. I had to bring out my copy of Strunk & White to prove that the changes were necessary. When we were done, the chapter was almost identical to what we started with.

At that point I should have told him I didn’t think we could work together. I should have walked away. But I didn’t. The result, a job that should have taken two to three weeks ended up taking two and a half months. And I never did get paid the full, discounted price.

Back to today

Looking back at all this, I wonder how I managed to stay in business beyond the first year. I did so many things wrong. It’s like I’m a different person now.

But in spite of how painful some of these experiences were, they were necessary. I’ve learned from these mistakes and become a better business person because of them. I’ve also learned how tough I am. I may have gone through some difficult times, but I’m still here and my business is still growing.

I’m sure I’ll continue to make mistakes over the years. But I’ve learned that it’s okay. Mistakes are truly the best teachers. And messing up is a sign I’m trying new things; trying to stretch myself.

Andrea J. Stenberg

What business mistakes have you made over the years? How did you get past them? Leave a comment and share your experiences with us.

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