What to Outsource as a Solopreneur

February 28, 2011

For most businesses, the two largest slices of the budget pie are people costs (salaries, benefits, and so forth) and office space. The only way to eliminate these costs is to go it alone as a solopreneur, which can be daunting. By outsourcing everything that typically requires an in-house workforce, you can bring down overhead and create the freedom to work on your own schedule—enhancing quality of life and business.

Without in-house employees to manage, no one calls in sick or needs a cubicle. When your outsourced agency or freelancer isn’t getting the job done, you can hire a new one. Paying hourly or on a monthly retainer lets projects be fulfilled by teams of experts, instead of by a skeleton crew of full-time employees the same money would buy.

As a solopreneur, here are five departments you’ll need to fill:

1. Promotions. Media relations, advertising, and design should work together to communicate your product or service. Outsourcing these to public relations and design firms gets you experts in the field without having to pay them to work full-time in your office.

2. Web management. Designing, updating, and managing your website keeps lead generation and in some cases, direct sales on track. Unless you have a professional background in Web development, don’t try to do this yourself. Having an out-of-date or malfunctioning Web site is the quickest way to turn potential customers and investors away.

3. Consulting. Having experts in logistics, for example—or other areas specific to your company—saves money, time, and headaches.

4. Warehousing. Holding inventory and fulfilling orders requires a facility filled with staff, but that doesn’t mean your business has to own one. For a monthly fee, distribution centers will hold, ship, print, and sort for you.

5. Accounting. Bookkeeping is detailed, time-consuming work that cannot be ignored or taken lightly. Accounting firms are equipped with the latest software and tools, which streamlines your business accounting.

On a personal level, not having full-time employees also gives you the freedom and flexibility to type e-mails in your pajamas, spend time with your family, and play golf on Friday afternoons, if you feel like it.

By Lee Loree

Lee Loree is the Founder of Sleeptracker in Atlanta, Georgia.

Source:  http://www.businessweek.com/smallbiz/tips/archives/2011/02/what_to_outsource_as_a_solopreneur.html

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Weekly Homepreneurs Recap – February 21-25, 2011

February 27, 2011

2-27-2011

Monday – Finding and Keeping Customers – Part 1

Want to start a business?  Do you know your target market or what customers want?  These questions require careful and thorough research.  This post discusses the importance of conducting data collection before starting or buying an existing business.

Tuesday – Tips for Creating a Successful eBay Storefront

Sarah Kessler’s article on 8 Tips for Creating a Successful eBay Storefront is one of the most popular postings on Homepreneurs.  Kessler covers customer service to branding and the importance of starting slowly.  eBay is an excellent opportunity for part-time work and is quite simple to set up and start with almost no initial capital.

Wednesday – Finding & Keeping Customers – Part 2

The second part of this series covers researching data and the importance of knowing how and what information to look at. 

Thursday – Business While Still Employed

Considering employment while working full time?  This post covers 9 tips for starting a business while you are still employed.  Good reading if you are considering leaving a job to start your own business.

Friday – Reasons Not To Launch A Startup

Susan Payton’s article on 4 Reasons Not to Launch a Startup provides valuable insight into the potential drawbacks encountered when considering a new venture.  Read this article before making a critical career decision!

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By Dion D Shaw

Dion Shaw is the founder and owner of Homepreneurs.

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4 Reasons Not to Launch a Startup

February 25, 2011

Yin and Yang.  Sunny and stormy.  Happy and sad.  Success and failure.  For every action there is an equal and opposite reaction.

Business is no different: It is subject to these same principles.

Many articles and posts on this blog focus on the positive aspects of launching a business, offering tips, expert advice, and opportunities.  Today’s opinion, by Susan Payton, offers potential drawbacks to consider before launching a startup.  This article is not to dissuade anyone from creating a business success story; I simply wanted to offer an intelligent view of potential pitfalls.  I strongly believe the correct combination of creative ideas, research, planning, and hard work ultimately yields success in many startup attempts.

4 Reasons Not to Launch a Startup

By Susan Payton

Startups are the new shiny toy these days. Groupon and Mint are among the constantly quoted examples of what can go right with a business startup, but what percentage of startups actually enjoy that kind of phenomenal success?

Before you jump right into a startup, consider these four reasons it might be worth thinking through.

1. Money Burns Like Kindling

Whether you’re bootstrapping your startup or actually get seed money or VC capital, I guarantee the money will disappear quicker than you planned. A VC in Silicon Valley wants you to meet in his office…tomorrow. Bam: $2,000 for travel expenses. Another mobile carrier said they’d consider hosting your app, if you make 20 hours’ worth of programming changes. Bam. Another $1,000 gone, with no guarantee of revenue as a result. Things break. Conferences come up. Money dwindles.

Even getting money can be problematic. VCs are the equivalent of journalists: they’re getting pitched from every angle, and being heard above the din isn’t always easy.

How to Circumvent the Money Drain: Having money, period, for your startup already puts you ahead of the crowd. Make a budget upfront and build in as many surprises as you can. Pad the budget for travel and discretionary funds, and make sure you always have enough to pay your staff.

2. The Learning Curve Is Tough

Unless you’ve done this before, I’m guessing you’re winging the whole startup thing as you go. Reading Hacker News and OnStartups; attending industry conferences; finding other startups in your area (or maybe you’re not doing these things?). There’s only so much you can glean about crafting a startup pitch to VCs from blog posts. You need inside advice, and what you lack may show when you’re pitching investors.

How to Get Your Startup Degree: Self-teaching and sticking with it is what helps the big startups get acquired or funded. Don’t give up. Find a local mentor or startup organization that will rally around you and give you inside tips on what investors (even specific firms) are looking for. Ask for advice in putting together your deck and business plan. You are not operating in a bubble; ask for help. Repay it on the other side.

3. You May Kill Your Co-Founder

You and your best bud came up with a fantastic idea for a startup…only now he’s dragging his feet at getting coding done, or disagrees with you on every point. How are you supposed to grow a business if you can’t even agree on a logo? Starting a business with a friend can be stressful and put a strain on a relationship. Do you have to choose between getting rich or having a friend?

How to Keep Your Friend and Make Money: At the outset of your startup, determine what each of you will do. What are each of your strengths? What will you each be responsible for? It’s a good idea if one of you takes the CEO role and can make executive business decisions. Make it clear who has what authority. Stay in constant contact, and don’t let aggression build up. Go out for beers together every once in a while.

4. The Competition Beats You to It

After months of development, you’re ready to release your app or service. The day before launch, you find out a formidable competitor has just launched the exact same product. Do you throw all your work down the toilet?

How to Keep on Truckin’: The thing about startups, especially tech ones, is that you can’t focus on a single product or solution. You have to be multifunctional and find different ways to reach your audience. If this was your only product, you must decide whether to go up against a competitor with deeper pockets. The smart thing to do is to start out working on multiple projects so you can shift your focus if need be.

If you’re still reading, congrats. If these reasons didn’t scare you away from creating a startup, I wish you the best. Ben Yoskovitz talks about why you should begin a startup. You’re passionate. You want to change the world.  You’re a control freak. But you don’t need me to tell you that.

Startups are like babies. They require a lot of care, and many people start them on a whim. But they need constant nurturing or they’ll die (taking your $100,000 second mortgage with them). Be fully prepared for the responsibility a startup entails, and you’ll be fine. You can thank me after you’ve sold to Google.

Susan Payton is the President of Egg Marketing & Public Relations, an Internet marketing firm specializing in blogger outreach, social media, and PR. She is also the blogger behind The Marketing Eggspert Blog.

Source: http://smallbiztrends.com/2011/02/4-reasons-not-to-launch-a-startup.html

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9 Tips for Starting a Business While You’re Still Employed

February 24, 2011

Most new entrepreneurs keep their job until their new venture is established and generates enough income to pay the bills. But launching your own enterprise before you quit your job isn’t easy.

While you juggle a job and a new business, keep the following advice in mind:

Put Your Job First

Always remember that until you hand in your resignation, your job comes first. Before moving ahead with your business plans, make sure you understand the responsibilities and work hours involved in running the type of business that you’re planning to open.

Hire Help

If your business demands your attention during your work hours, find a business partner or hire an employee who is available to manage your new company while you’re working.

Balance Your Time

When considering businesses that mesh with your current work schedule, look into an Internet-based company such as an eBay store. You can take care of most of your responsibilities before work, after work and on days off. Or consider a business such as dog-sitting, which you can operate only on weekday evenings and weekends while you’re still employed.

Tell Your Employer

If you think your employer will be receptive, tell your employer that you’re starting your own business. That will make it easier to talk to your supervisor about changing your work schedule if you need more flexible hours.

Use Your Own Equipment

Never use your employer’s phones, computers or other equipment or supplies for business related to your own company. If you don’t have a smartphone, invest in one now. Use it during breaks at your job to answer e-mail and make phone calls related to your own business.

Work on Weekends

Try to meet on weekends with suppliers, potential employees and other people related to your new company. That will help you avoid potential conflicts with your work hours. Avoid the temptation to meet with people before work. Traffic jams and other unpredictable delays can make you late for your job.

Prepare Your Family

Prepare your family for the prospect that you’ll be working on your new venture on weekends and into the evenings on some weeknights.

Be Patient

Stay focused on your job while you’re at work. You may need that job longer than you expect. You can’t predict how long it will take to get your new venture on its feet.

Source:  http://www.nfib.com/business-resources/business-resources-item?cmsid=49943

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Finding and Keeping Customers – Part 2 – The Data

February 23, 2011

February 23, 2011

This may be obvious to many, but consider: Before starting research on potential target markets and customers, you need to identify the data required.  What exactly are you looking for?  Answer this question first and save yourself time, effort, and unhelpful results.

Many different types of data and data collection methods exist.  To keep this short and simple, I’ll summarize the major areas.  If you want to know more, I suggest reading various home-based business handbooks.  Good examples include: Entrepreneur’s Ultimate Homebased Business Handbook or Home-Based Business for Dummies.

Types of data

Primary data: This is information collected by conducting your own research.  If already running a business, this may include talking with customers, suppliers, competitors, and associates in the industry.  You may be considering starting a similar business or buying the business you already work for.  Direct conversation with customers about the product or service, the vendors about the existing supply chain or competitors about the marketplace is the best way to gain real feedback while gauging body language and emotion.  Other methods of gathering primary data include mystery or comparison shopping, focus groups, and formal surveys.

Secondary data: This data is not generated via personal interaction and usually involves an outside source or third party.  Secondary data can come from books, magazines, trade publications, the Internet, SCORE or government agencies at all levels.  Endless volumes of information exist in libraries, bookstores, through businesses, chambers of commerce, etc.

A word of caution: Because so much information is available, identify first what you data you need to collect.  Determining objectives will help maintain focus on what needs to be researched and keep you from collecting irrelevant data.

Quantitative vs. Qualitative

Quantitative data is expressed in numbers and percentages and is very useful to a small business owner.  This data is objective, easily measured, and easily transferred to charts, graphs, and lists for planning purposes.  An example is a survey with yes or no questions or a ranking scale of customer satisfaction (1-5).  Results may be noted as 83 of 100 respondents0 vote yes or our satisfaction survey of 100 people indicates an average satisfaction rank of 4.4.

Numbers while very useful and easily compared to previous surveys, do have drawbacks.  They provide results but not reasons for the numbers or percentages generated.  Numerical data can also be manipulated in questionable ways.  As Mark Twain famously stated: “There are three kinds of lies: lies, damned lies and statistics.”

By contrast, qualitative data is expressed in answers and statements.  This data provides opinions on what customers and others think about your product or service, quality, pricing or anything else that can’t be expressed in numbers.  One very important concept: Use open-ended questions to encourage people to express thoughts freely.  These questions can be asked via surveys, focus groups or informal discussions.
Qualitative data is valuable because the information can reveal more precise details about what your customers or potential clients feel about issues specific to your business or the products or services involved.  A downside is the data may be subject to bias, either by the person interpreting it or by the method of interpretation.  Another problem is attempting to aggregate the data or represent it simply in graphs, charts or numbers.

Summary

Data gathering and knowing which data to collect is crucial to your research effort.  Many resources and methods exist for gathering this information from a personal conversation to the anonymous survey.  Don’t rely on strictly numerical data or solely on stated opinions.  A combination of both is likely necessary and valuable.

By Dion D Shaw
Dion Shaw is the founder and owner of Homepreneurs.

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