10 Tips For Your First Year As A Small Business Owner
There’s no sugar coating it, owning a business is TOUGH. And your first year of owning a business is possibly the toughest of them all, between trying to find clients, figure out your taxes, and remembering to eat and sleep while you’re doing it all, it’s safe to say that entrepreneurship is not for the feint of heart.
But there’s good news. . . LOTS of business owners have completed their first year of business ownership and lived to tell the tale. Luck for you, I’m one of them and I am here today to share my 10 Tips For Your First Year As A Small Business Owner.
Ready or not, here we go!
1. Organization Is Everything
Anyone who knows me will tell you that I’m a little bit of an organizational freak. Sometimes this feels like a huge annoyance, but I can honestly say that this quality has made my first year of owning a business INFINITELY easier than some of the horror stories I’ve heard from other people in my same position.
There are three main parts of my business that I made sure to get and keep organized throughout the year and I would highly recommend that you do the same!
ORGANIZE YOUR MONEY
That’s right, you started a business to make money which means you should be keeping close track of the cash you’re making, spending, and saving. I just use a simple excel sheet for this because I like that it forces me to manually input every dollar and cent that comes in and out so that I’m never in the dark about my finances, but there are lots of easy online tools you can use to save yourself some work. There are hundreds out there, but I’ve heard great things about Wave, Quickbooks, and Freshbooks.
A lot of project management systems like 17Hats, Dubsado, and Honeybook also have bookkeeping features included, so that’s something worth looking into as well if you’re already using one of those programs.
ORGANIZE YOUR PROJECTS
Missing files, unclear communication with your client, passed deadlines with nothing to show for them? Sounds like a blast, right?
Just kidding…that sounds like an absolute nightmare. A great way that I’ve avoided these issues in my first year of business is by using a project management system to keep myself and my clients organized and on track.
I personally use Dubsado but I have also used and loved 17Hats, and heard great things about Honeybook , Asana, and many more. The important thing here is to find a project management system that works for YOU and your business.
I use Dubsado to send contracts and client questionnaires, collect payment, set deadlines, and collect client feedback. They also recently rolled out a new client portal feature which allows my clients to see all of their files and project status in a neat little dashboard so that we’re always on the same page!
ORGANIZE YOUR SOCIAL MEDIA
Yep, it’s time to tackle the Social Media beast that we all know and love. Fortunately for you though, there is absolutely no way on earth that I would ever suggest you tackle ALL social platforms at once.
A very wise lady (who is also my business coach) once told me to pick two. Just pick TWO social media platforms that you want to work on for the next six months (or three months, or a year, whatever works best for you), and work on mastering those.
The two that I chose at the end of 2017 were Instagram and Pinterest and while I am still chipping away at my follower and engagement goals, I quickly learned that organizing my social posts and automating them as best as I could would be a huge time and stress-saver. Personally, I use Tailwind to schedule all of my Instagram and Pinterest content. It’s simple, straightforward, does exactly what I need it to. They also have great customer support for when I run into any issues.
Other options for social media scheduling are Planoly, Buffer, CoSchedule and HootSuite. Most of these offer free/trial plans, but I’ve only ever used Tailwind so be sure to do your own research to find what will serve you best.
I know this sounds like a ton of front-end work, and it is, but I can’t tell you how much you’ll thank me when you’re six months down the road and effortlessly posting your content, increasing engagement, and NOT stressing!
2. Know and Charge Your Worth
Before you can really get to work, you need to set your price point. Figuring out what to charge, and then sticking to those prices was one of my biggest struggles in starting a business, and I think that’s true of a majority of new small business owners in any industry. It seems to be a little easier if you’re a product based business, because you can follow the simple formula of
(Wholesale Price + Additional Costs/Overhead + Desired Profit = Product Price)
but if you’re a service provider it’s not so cut and dry. We often fall into the trap of offering huge discounts, lowering our rate, or even just doing projects for free “for the exposure”. I’ve been there, I’ve done it, and I’ve survived to tell you it’s not worth it.
You’re probably thinking “but I don’t have ANY clients/customers yet…how can I charge premium prices with nothing to back it up?” Just bare with me for a minute. I know that you might not be able to start out charging what you WANT, but you can certainly start out charing what you’re WORTH.
*important side note: I actually kind of hate the phrase “charge what you’re worth” because you are “worth” SO much more than any dollar amount you could put on your services or products. Just for the sake of simplicity in this post, we’re going to use the term “worth” to mean “what is a fair price for your experience, skill level, and the actual thing you are providing.”
Charging what you’re worth in your first year of business is CRUCIAL because it lets your customers know that you’re a business. This isn’t just a hobby – you take it seriously and they should too.
UNDERCHARGING BREEDS RESENTMENT
You can tell me all day long “oh it will just be this once, I don’t mind” but you will never, ever convince me that that’s true. If you charge a client $50 for a job that really should be closer to $500 (yes, I’ve done this before), chances are you’ll do some or all of the following:
Get frustrated because you’re starting to feel like the job and client aren’t worth your time
Be in a hurry to just get it done, and not give the care and attention that you know you should
Start to resent your client/customer when things take longer than expected or don’t go as planned
These are all bad for both you and the client because you feel cheated financially, and the client generally isn’t happy with the level of work provided (I’d guess you won’t be too happy with it either)
AVOIDING UNDERCHARGING AND SCOPE CREEP
A great way to avoid undercharging is to get super clear about the work scope, include a detailed list of deliverables in your contract, and if you feel like it’s necessary, even include an hourly cap.
Here’s an example of how I do this in my quotes/contracts:
“Specht & Co. will provide the following: primary logo, secondary logo, color palette, typography links, brand style guide. This quote covers up to 20 hours of design time. Any time spent beyond that will be billed at an hourly rate of $50/hr to be paid upon project completion.”
EXCHANGE LOWER PRICES FOR GLOWING TESTIMONIALS AND REFERRALS
I think we can agree that it’s not realistic to jump right into owning a business and charge $100+ per hour like most of us would like, but you can absolutely work your way there. At the beginning of 2017 when my business was new, I often took projects on at a lower cost than I would have liked but I did something strategic to offset this.
I offered lower prices to clients in exchange for a testimonial and sharing my info on their site and social media profiles.
If I wasn’t able to charge what I wanted, then I knew I could get customers by charging a little less, knocking their project out of the park, and using their glowing testimonial as social proof for future projects. I also required those clients to let me include a link to my own website on their sites footer, and share my information any time they shared their site on social media.
Sure enough the referrals started rolling in, and I was able to charge those new clients my full prices with no problem at all!
3. Establish Your Brand
Equally important to having a solid pricing structure, is having a solid brand identity. I am not exaggerating when I say that your brand identity can AND WILL make or break your business. So it’s really really important that you take this tip to heart.
And because I know you’re probably already thinking it – NO I’m not just telling you this because I’m a branding designer and I want you to hire me. I just honestly believe that the backbone behind a rock-solid small business is a clearly defined brand, whether that’s professionally designed, DIY’d, or otherwise.
A brand is the set of expectations, memories, stories and relationships that, taken together, account for a consumer’s decision to choose one product or service over another
– Seth Godin
IMPORTANT COMPONENTS OF A BRAND
There are a few key components of a strong brand that I think are important for you to identify and create when you start a business. These include the following:
Target Audience Defined: Who are your ideal clients and where do you find them
Brand Message: What is your brand all about? What message are you trying to spread to the world?
Brand Voice/Style: How your brand wounds when it speaks to your audience. Are you cool and casual? Stuffy and technical? Do you use curse words? What type of things do you talk about? What’s off-limits?
Visual Identity: Logo, Color Palette, Typography, Photography, Website, etc.
Notice the visual identity portion isn’t at the top of the list? That’s because you need to nail down all of the other pieces FIRST before you can hope to have a rocking visual brand identity.
You can DIY the visuals if your pressed for time or cash, or you can hire a branding designer like me to put them together for you – it’s less important where the visual pieces of your brand come from (ok it’s important, but I totally get being in bootstrapping mode) and more important that you make sure they’re all CONSISTENT.
Your brand should look, feel, and sound the same across any platform that people will see your brand. This means your website, social profiles, printed materials, etc should all have one cohesive look, feel, message, and voice so that there’s no question about who you are or what you do.
Once your brand is established, it will make it 1000x easier to share your message, services, products, and business with the world and grow to your greatest potential!
Need help getting started with your branding? Let’s chat and see if I might be able to start you off in the right direction!
4. Be Social On Social Media
Now that you’ve got your shiny new brand, one of the main places you’re going to share it is on social media, and that’s where tip #4 comes in! If social media is a part of your business (and for the sake of this post I am assuming that it is) then it’s important that you’re getting the maximum benefit out of it.
And before you ask – no, sharing cute puppy videos does not count as getting the maximum benefit for your business. If it did, I would I would be a multi-billionaire sailing around the world on my gold plated yacht, being served mimosas by well-trained dogs wearing butler outfits. Instead, I am sitting at my desk writing to you about why you need to make friends on social media, which I suppose is a close second.
Anyway, back to the point.
USE SOCIAL MEDIA TO CONNECT WITH POTENTIAL CLIENTS AND BUSINESS BUDDIES
So often people join business-based facebook groups and spend all of their silently lurking, afraid to comment on a post, ask a question, or offer advice. This is such a shame – imagine how much amazingly useful knowledge never gets shared because people are afraid to be outgoing online. It’s SOCIAL media, people – BE SOCIAL.
If you see someone asking a question that you know the answer to? Answer it.
If you see someone looking for a rockstar web designer and know of the perfect person for the job? Connect them.
If you notice someone looking for feedback on their work and have a few minutes to spare? Help them out by providing some helpful notes.
DON’T BE SALES-Y. JUST DON’T DO IT.
The moral of the story here is that you should be using social media to look for places that you can use your skills to help people. For free. I am a firm believer that if you serve your community well (online or otherwise), clients and customers and work and whatever it is that you’re after will come to you. I’ve seen it work for myself, and I know it can work for you too.
Do not, I repeat, DO NOT reach out to answer a question and then immediately follow it up with a sales pitch. Don’t flood the promo threads with links to your website and not offer any meaningful content or an actual message. Don’t spam people with reasons why they should hire you without first taking the time to learn who they are.
Social media is a GREAT place to make connections with other professionals in your industry, get yourself seen by potential clients, and find meaningful communities to be a part of. Participate honestly, socially, and selflessly and I can all but guarantee that it will pay off.
I’ve mostly touched on Facebook groups in this post, but the same rules and suggestions can be applied to LinkedIn, Instagram, Twitter, and pretty much any other online community that you’re a part of.
5. Schedule Time Off, And Actually Take It
So now you’ve got your pricing set up, your brand looks and feels amazing, and you’re rockin’ those facebook groups meeting a ton of clients and making business buddies all over the place. You’re probably also a little bit (or a lot) exhausted. And that my friends, is why tip #5 is not only my favorite, but possibly the most important out of this entire list.
YOU OWE YOURSELF A BREAK
As someone who is was balancing a full time job with running my own branding and web design business for about 2 years before I said goodbye to corporate America, I know that it’s hard (or seemingly impossible) to take time off. Who will write the blog posts? Who will pitch to new clients? Who will answer emails? I have heard (and made) every single excuse in the book.
Get ready for a little tough love here, because you know what…you have to suck it up and take a break anyway. You owe it to yourself, you owe it to your family, and you owe it to your business.
TAKE TIME OFF AND COME BACK READY TO KICK A** IN YOUR BUSINESS
In a survey by the Bureau of Labor Statistics, 83 percent of respondents said they spent no time during the day relaxing or thinking.
WHAT? This. Is. Ridiculous. Your brain NEEDS downtime in order to function properly, and I’d bet a big ol’ stack of cash that if you burn the candle at both ends for too long, there will eventually be nothing left to burn.
I am literally writing this post from my couch, in my PJ’s, with my fireplace on and my dog cuddled up next to me after a grand total of 11 days off for Christmas and New Years (this isn’t getting posted until February though, so sorry for the confusion). I spent the better part of December looking forward to this long break, but it wasn’t until it was time to get back to work that I actually realized how much I needed it.
I hustled hard for the last quarter of 2017, working too much, not sleeping enough, and telling myself that I needed to stop being lazy and get sh*t done. Today though, after over a week of rest, I’ve been able to come back to work refreshed, full of new ideas, excited to network with other business owners, and generally just stoked about 2018.
If I had worked straight through the holidays without taking time for myself, my pets, my family, and my mental health, this would absolutely not be the case.
DON’T WORK DURING YOUR TIME OFF
Okay so you’re ready to schedule in a little break for yourself. Congratulations! But now it’s time for a new challenge…actually taking that time off. I’ll be the first to tell you that I’ve scheduled weekends off for myself, and then spent the entire time obsessively checking my phone for client emails or anxiously waiting for Monday so that I could get back to my mile high to-do list.
Guess what? That “time off” didn’t really do me much good. In fact, it probably stressed me out more than if I had just kept on workin’. So then what was the key to my oh-so-restful staycation in December you ask?
I didn’t work. At all. I set an auto-responder on my email, deleted all of the work-related apps on my phone, and put anything that I thought might tempt me to work (such as my fancy new planner) in a locked file cabinet for the entire time that I’d scheduled to be off. It. Was. Amazing.
Maybe you have more self control than I do, and don’t need to go to such drastic measures as I outlined above. But if you do need to do something crazy like make your husband change your computer password to something that you don’t know (yep, I’ve done this too), then do it!
Do whatever it takes to ensure that your time off is truly time off and I promise you’ll be all the better for it when it’s time to come back to work. Maybe 11 days isn’t quite feasible for you right now, but I’d bet you can squeeze in a half or full-day here and there.
6. Figure Out Who Your Ideal Client Really is
If you’re a business owner, online or otherwise, then I am all but certain you’ve heard the term “ideal client” more than once. Maybe you refer to it as an “ideal customer” if you sell products rather than services, but it’s all the same really.
Defining your ideal client is one of, if not THE most important parts of developing your business. Unfortunately, it can also be one of the most frustrating and stressful parts. Today I am here to tell you that it doesn’t have to be that way. Keep reading to how I was able to identify my ideal clients in a way that felt comfortable rather than stressful, and that landed me working with the exact clients I was meant to.
IT’S OKAY TO START WITH A BROAD CLIENT BASE
I didn’t know who my ideal client was when I started my business, and I didn’t even know that it was something I should know. I just slapped together a quick website, took any projects I could get my hands on, and did a little happy dance every time someone paid an invoice. I worked with financial advisors, henna artists, insurance agents, realtors, printmakers, and more, none of which had anything in common at all.
If this is what you’re doing too, fear not! This is a perfectly acceptable way to start a business. Bear in mind though, while this is a good way to get your business up and running and to start bringing in some cash, it’s probably not a great way to maintain a business. Not one that you’re happy with anyway.
IDENTIFY YOUR IDEAL CLIENT NATURALLY
Eventually after working with enough different types of people and businesses, I was slowly able to start to identify common qualities of people and businesses I loved working with, and common qualities that I didn’t love working with.
I realized that I did my best work, and felt most “in the zone” when I was working with businesses who had some or all of the following qualities
Small business or solopreneur
Some sort of creative element (artists, hand-made goods, coaches, etc.)
Somewhat outdoorsy/adventurous and care for the environment
110% passionate about their business
A desire to collaborate throughout the branding and website design process
I was then able to wrap this all up into one short sentence describing who I am, what I do, and who I do it for.
“I’m a branding and web designer who works with adventurers, artisans, and
passionate small businesses owners.”
This is how I started building my ideal client profile, and it’s how you can build yours too!
You don’t need some fancy worksheet with all of the details of what color hair your ideal client has and where they like to shop. Not right away anyway. Those types of documents can be super helpful and useful, but there is no need to overwhelm yourself when you’re just starting out.
Instead take notes of what client projects you loved, what you hated, and why. Compile these notes until you can start to see patterns, and use those patterns to build out your ideal client profile.
WORK WITH CLIENTS YOU WANT, NOT CLIENTS YOU THINK YOU WANT
It’s so easy to start filling out an ideal client profile that says “My ideal client is new moms between the ages of 24-34 who have platinum blonde hair, shop at Banana Republic and don’t eat carbs” just because that’s who you THINK you want to work with.
In my experience, what you think you want never does you much good though. If you start defining your ideal client naturally instead, like I did, it will help you to narrow in on who you actually enjoy working with, and who your products or services actually resonate with rather than just the clients you think you want/need.
DON’T STRESS, YOU CAN DO IT!
Identifying your ideal client is absolutely an important step in building your business, but don’t let it’s importance trip you up. Take what business you can, pay attention to how you feel about your clients, and let your ideal client profile evolve naturally.
It’s also helpful to remember that your ideal client now might not be your ideal client two years from now so keep repeating this process to make sure you stay on top of who your audience is and what they want from you.
7. Failing Is Inevitable, And Also Acceptable
You’ve made it to tip # 7 in this list, congratulations! Hopefully by now you’ve gotten the basics of organization down, your brand is established, you’re rockin’ those facebook groups while still taking enough time off for yourself, and you know your ideal client like the back of your hand. Nothing can go wrong now right?
WRONG.
Things will go wrong. I hate to be the bearer of bad news, but it’s the truth. Instead of avoiding it, let’s talk through how to deal with it.
MY FIRST BIG BUSINESS FAILURE
I was about 6 months into my small business owner journey when I got fired from my first gig. It was a website for what I’ll refer to as “a big fancy sciency person” who was developing her own product and needed a website to promote and sell it. We talked budget, timeline, and where all of the website assets would come from, and we were off to the races.
Fast forward a couple of weeks of poor/unclear communications, missing pieces on the client’s end, and frustration on mine, I finally decided to just put together a homepage mockup with what I had in hopes that would encourage the client to send me what I needed.
This ended up blowing up in my face a bit, when I received the email that the page was too boring for their taste, and with such a tight deadline (approximately 30 days away) they had decided to hire another designer.
I was heartbroken. Angry. Frustrated. Confused. Annoyed. I felt like I had honestly done the best I could with what I had, tried to go out on a limb to deliver something even when I was missing necessary info from the client, all to be told “nope not good enough.”
FAILURES ARE AN OPPORTUNITY FOR GROWTH
It was rough, but after a couple of hours of licking my wounds I moved on to the next project and put some systems in place to ensure that I never ran into that same issue again.
I’ve now started including deadlines in my contracts, being really clear about which steps of the process are the clients responsibility and which are mine, and being overly communicative with my clients on the status of their projects, what I have done so far, and what I need from them.
In hindsight, I think that completing that website project may have been more of a beast than I’d originally bargained for, and last I checked, that client still doesn’t have a live website. I’m truly grateful for the learning experience though. This seemingly negative event taught me that I needed to be more strict on what I required of my clients, more clear with my communication, and MUCH more clear on what type of clients I wanted to work with. I learned that I don’t have to be the perfect fit for every client, and that sometimes things just don’t work out. Instead of beating yourself up next time a project goes south, take a step back and try to identify what the key issues were, and what you can do to avoid them in the future.
“The difference between an obstacle and an opportunity is your attitude towards it. Every opportunity has a difficulty, and every difficulty has an opportunity.”
8. Every Interaction Is A Business Opportunity
Just bare with me for a minute here. I am NOT, I repeat, NOT saying that you should give your business card and a sales pitch to every mailman, plumber, and grocery store checker that you meet in your daily life. Don’t do that – they’ll think you’re a fake salsey jerk.
Instead, you should take all of those interactions and view them as opportunities to learn about who people are, what they want, what their struggles are, and what their goals are. Now I understand that the cart-pusher at Walmart is likely not your ideal client, but that doesn’t mean there isn’t something you can learn from him/her.
“In my walks, every man I meet is my superior in some way, and in that I learn from him” – Ralph Waldo Emerson
BE FRIENDLY AND HELPFUL, NOT A SALESMAN
Take the time to have meaningful conversations with people, soak up all of the information like a sponge, and share your knowledge and skills where applicable.
Notice I said where applicable – this means only IF they want/need it.
Approach every interaction with a mindset of “how can I help this person”, build honest friendships and serve others. Do this enough times, and it’s pretty darn likely that you’ll run into someone who DOES need your product/services or has a friend or family member who might. It is these types of organically forming client relationships that make me love what I do, and know that it’s possible for you to do too, no matter what industry you’re in.
9. A Thick Skin Will Serve You Well
If you’re anything like me, you know that words can hurt and unfortunately running a business sometimes comes with some not-so-nice comments from disgruntled clients as well as competitors. I wish I could tell you how to avoid these types of struggles completely, but instead I am going to share with you how I have been able to prevent these types of situations from having too much of a negative effect on me and my business thus far.
I’m going to go ahead and assume a couple things:
You started a business because you love what you do, and you’re pretty dang good at it
You want to please your clients/customers 100% of the time
It totally breaks your heart when you get any sort of a negative response from a client, critic, family member, or friend
If you answered yes to any of the above statements, then we have something in common. Trust me when I say that completely understand, and it’s absolutely okay to be a little sensitive. I might even argue that it’s an asset, actually.
So keep on feelin’ those feels and for the love of goodness do NOT listen when someone tells you, “you just have to stop caring what people think”. I caution you of this because. . .
A) At some point in your career someone WILL tell you this
B) They obviously don’t realize that it’s just not that simple
So instead of not caring, or pretending not to care, I encourage you to learn to separate your business from your personal life. Our businesses are our babies, and I know how much blood sweat and tears you put in on the daily, but I have found that it is absolutely imperative to not only my sanity but also the well being of my business that I don’t let my entire personal identity be wrapped up in the status of my business.
SEPARATE YOUR BUSINESS LIFE FROM YOUR PERSONAL LIFE AND GIVE PEOPLE A LITTLE GRACE
There are going to be good times and bad times in business, and if your emotional state is directly dependent on the state of your business, you’re going to be in for a rollercoaster of a ride. I’ve been there myself, and trust me when I say, 10/10 DO NOT recommend this.
Next time you get a less-than-desirable response from someone, take a minute to consider that maybe they don’t know a more effective (read: nicer) way to communicate, maybe they’re having a bad day, not feeling well, or maybe whatever your discussing is just REALLY important to them and they’re super passionate about it.
Don’t take anything in business too personally, and try to view every criticism as an opportunity for learning and growth. I know it sounds silly and obvious, but I can honestly say that some of my biggest “ah-ha” moments and times of both personal and business growth have come right after getting negative feedback, rejection letters, or just news I didn’t want to hear.
#smallbizlife can be brutal sometimes, and a thick skin along with a healthy separation of your work life and your personal life will help you get through it as unscathed as possible. Not only that, but it will allow you to use those stumbling blocks and not-so-awesome comments as platforms for some crazy awesome growth and learning!
10. Never Lose Your “Why”
Hopefully by now you’ve got a pretty good idea of why you started your business. It could be for financial freedom, to be able to stay home with your babies, for location independence (aka that nomad life) or just to pay down your student loans. To be frank, it really doesn’t matter WHAT that reason is, just that you have one.
Do you have one? Yes? Good.
Find your reason, and remind yourself of it weekly, daily, hourly, whatever works. Write it down somewhere that you’ll see it every day, use a photo that symbolizes your reason as your computer or phone background, heck even set a reminder on your device to literally REMIND you of your reason at various points during the day.
There will be times when you want to throw in the towel, where your battling some serious imposter syndrome, or where people don’t support you the way you wish they would. There’s no avoiding it – at least not that I’ve found so far.
Instead, in these times it helps to remind yourself that this (whatever “this” may be) is a legit business, not just some silly hobby, that you are an independent business owner who can make good decisions and get sh*t done, and that there is nobody who knows what you need or what you should do better than you do.
Take yourself seriously, give yourself permission to succeed, and never let your “why” get too far out of your mind. This coupled with the other nine tips I’ve provided you, should set you up for success and growth in your first year as a small business owner, and my hope is that you’re able to do all of this while feeling confident, centered, and like you can take on the world!
Congratulations!
You have made it through all 10 Tips For Your First Year As A New Small Business Owner! I truly hope that these tips have proven to be useful for you and your business, and I would absolutely love to hear about how you’ve implemented some or all of them for yourself. Comment on this post or send me an email. . . seriously, do it!
