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post #1 of 15 (permalink) Old 5th October 2009 Thread Starter
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To those considering self-employment...

Hi all.

In these uncertain economic times, many of you will either be in the situation where your job is at risk, or worse still - the axe has already fallen.

I was in a similar situation in 2005 after being made redundant, and just thought as its approaching the 4th anniversary of starting my business, that I could perhaps share some of my experiences.

  1. Identify a target market - is it sustainable and can it be developed further? You need to know that what your business provides will in turn, provide you with a year-round income.
  2. Keep the fixed overheads as low as possible - variable costs are fine (they increase as the business activity does), but a fixed cost can be a millstone during the early days/seasonally quiet periods.
  3. Venture Capital - how the business is funded during start-up is crucial, use savings (your own, plus family assistance if possible), rather than borrowing from High Street sources - the rate of interest will be less, plus again, you won't be working just to payback a loan.
  4. How to source what you need - go online and also ask your friends/family for favours. I got my website constructed & designed for 2 cases of lager!
  5. Sole Trader/Partnership/Limited Company (which to choose) - they each have strengths & weaknesses, sole trader & partnerships can do their own tax returns (good or bad thing depending on your POV), Limited Company must use an accountant - but a Limited Company gives you the assurance that your house is not on the line in the event of failure, plus it can give the assurance to your customer that your business is bigger than it is.
  6. Is being self-employed 'right' for you - flexibility in terms of operating hours, long working weeks, no holiday or sick pay - its not for all. Plus its a big step into the unknown as its usually lean times in the early days - family support is vital.
  7. Can you carve a niche - you don't want to be the same as your competitors, you want to be better. I focus on my costs, so I can undercut all my rivals (yet still make a profit), but add service, which costs nothing, but gives the customer the all-important 'feelgood factor'.
  8. Advertising on the cheap - you need to get the message out there, so customers know you exist. Radio & Newspaper is too expensive, and in my experience, doesn't provide a lasting impact. If you use a vehicle - put eye-catching graphics on it & park it in a high-visibility spot. Put fliers under wipers/hand them out in the street, advertise in these quarterly booklets which get dropped through the door. You can spend a fortune doing this if you take the 'shotgun' approach, so take your time, and stick within your budget. The most important point is to ask every person who contacts your business, just how they heard about you - that's how you'll know what works.
  9. Planning your launch - don't just view this from your perspective, think about how the company's image is perceived by your prospective customers - I have a freephone number which re-directs to my mobile which is also listed seperately. This entices those who don't want to pay for the call, when scouring the directories, plus it adds to the business' legitimacy, and doesn't place a geographic 'fence post' around me - which is very useful if you want to work outside your immediate territory. My mobile is included to placate those who have a fear of contacting call centres...
  10. Trade or Retail - I have no garages/dealerships that I work for. This suits me fine, as although I will miss out on a high volume of business throughout the year, I can dictate/plan my own working week, plus I don't have to wait 30 days to receive payment (cashflow is king). My own customers also act as advertisers for my business - telling family/neighbours/work colleagues, etc.
  11. Know where your business is, without over-analysing - for the first year, your trade will be pretty much feast or famine - you probably won't know how busy you will be from one day to the next - only worry about this if competitors are doing well, when you're not. Once you have a year's history, start looking at the current year's performance year on year - that will give a true indicator how you are performing, and will also allow you to predict, and plan for peaks & troughs. It should go without saying, that you try to incur your fixed costs during your busy spells, and budget your spending as each month being quiet, whatever extra you earn is then a windfall. (Don't count your chickens until they're hatched, in other words).
Hopefully this long-winded posting has been on some help, if I can elaborate further, or if you have any specific questions, please don't hesitate to fire away, and I'll do what I can to help.

Best of luck,

Paul

This job should never be complete - the day I think I've done it all, is the day I resign.


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post #2 of 15 (permalink) Old 5th October 2009
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Nice one Paul! Good advice!
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post #3 of 15 (permalink) Old 5th October 2009 Thread Starter
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Thanks mate, I don't claim to know all the answers, but 2 heads are better than 1.

Paul

This job should never be complete - the day I think I've done it all, is the day I resign.


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Currently in VelSatisfied's garage:
2005 FIAT Ducato 2.8JTD LWB Gran Volume, 2000 Kawasaki ZZR 1100 D7 'fullpower' in black + full GIVI & KAPPA luggage, 2007 MB R-Class 320 CDi Sport LWB uprated by Brabus to 300Bhp don't know if there's a 155mph limiter - will be fun finding out! 2004 Mercedes Vaneo 1.7 CDi Ambiente 7-seater
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post #4 of 15 (permalink) Old 5th October 2009
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You could also inspire someone who had thought about it before
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post #5 of 15 (permalink) Old 5th October 2009 Thread Starter
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I'm sure there are plenty who have considered it - but its not for everyone - if I can help someone avoid making an error, or conversely help someone develop a great idea, then this thread will more than have served its purpose.

Paul

This job should never be complete - the day I think I've done it all, is the day I resign.


S.M.A.R.T. Technician
Currently in VelSatisfied's garage:
2005 FIAT Ducato 2.8JTD LWB Gran Volume, 2000 Kawasaki ZZR 1100 D7 'fullpower' in black + full GIVI & KAPPA luggage, 2007 MB R-Class 320 CDi Sport LWB uprated by Brabus to 300Bhp don't know if there's a 155mph limiter - will be fun finding out! 2004 Mercedes Vaneo 1.7 CDi Ambiente 7-seater
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