What Successful Entrepreneurs Wish They'd Known Sooner
If you’re planning to start a business, you’ll want to learn from their experience
NerdWallet, a consumer advocacy and financial literacy website, recently surveyed successful small business owners to find out what they wish they’d known when they were just starting out. Below, their six most frequently cited tips:
1. Hire an accountant.
Crystal L Kendrick, president of the Voice of Your Customer, a Cincinnati-based marketing company: “There are many deductions, loopholes and requirements that only professional financial professionals are trained to identify and manage. If company finances are not properly managed, the accountant and bookkeeper may have to redo all of your work to complete your annual taxes. Fees for duplicate efforts, incorrect entries or late filings can be astronomical and unnecessary.”
(MORE: 5 Mistakes to Avoid When Starting Your Own Business)
Josh King, founder of Tinderbox Consulting in Spokane, Wash.: “My number one tip? Consult a CPA before filling out any paperwork or choosing what type of business you’ll set up. There are pros and cons to be aware of when deciding between an LLC, sole proprietorship, S Corp., etc. You may have to pay a consulting fee or an hourly fee, but it’s money well spent. Nothing is worse than paying unnecessary taxes!”
2. Get a mentor — and ask questions.
Raven Robinson, founder of Veranda Lane Leadership Coaching, a life and leadership advisory service based in Washington, D.C.: “There’s an entire industry of people online that provide cookie-cutter advice on how to start, run and market your business. It may seem smart to tap into each resource and get as much information as you can for free, but you’ll end up confused. None of them will give you the whole story. It’s better to find a mentor or a business coach who will know more about the unique aspects of your business and give you advice tailored to that. A business coach is especially useful if you’re starting a business based on one of your passions or talents, but aren’t quite sure how to turn that into revenue or market yourself.”
Madison Isom, owner of Arrow Travel, a travel agency based in Birmingham, Ala.: “I wish I had known or reached out to more people who could have mentored me. I threw myself into my job with no prior sales experience and would be much further if I had more help all along.”
Sharon DeLay, founder and president of BoldlyGO HR, a human resources and business operations consulting firm in Columbus, Ohio: “Never be afraid to ask others for help or advice, even if you think they’re ‘too high up’ or too busy. We’ve all been there and often want to help others.”
(MORE: Why Women Need to Be Mentors or Find Them)
Carol Lynn Curchoe, Ph.D., founder, president and chief executive of 32ATPs Scientific Consulting in Salt Lake City: “Mentorship works up, down and sideways. Do you have a mentor? (If not, find one). Are you giving your mentors as much as they have given you? Are you giving those below you a hand up? Are you a good citizen? Your company will be part of a community — find that community and nurture it. Your small business venture will be an integral part of your state’s economy. Become an active participant in the economic and business communities in your state.”
3. Do your research.
You might want to use a cost-of-living calculator to assess expenses in your city, for example. Here are some other suggestions from successful entrepreneurs:
Michael Bremmer, chief executive of Telecom Quotes, a Los Angeles-based business communications consulting firm: “Read lots of business books instead of watching TV (unless it’s Shark Tank). Spending $200 on good business books and applying the information diligently will save you thousands of dollars in lost time.”
David Costello, chief executive of ServiceScape, a professional-service marketplace in Brookline, Mass.: “My biggest tip for new entrepreneurs would be to avoid learning from trial and error as much as possible. Instead, talk to people who have been in the trenches — those who know your business and the industry and can offer lessons learned.”
(MORE: The Best Ways to Get Free Help Starting Your Business)
Riley Swenson, the Salt Lake City-based vice president of marketing for Power Practical, maker of The PowerPot, an energy-efficient charger: “To run an effective small business you must know how to research effectively. Knowing how to use a search engine to find specific information and alternative viewpoints is an essential part of starting a small business. My company has used Google searching and academic databases for market research and for learning about competitors, online marketing strategies and business development. It helped us identify areas where we needed help and where we could execute by ourselves.”
4. Focus on retaining loyal customers.
Andrea Eldridge, president and chief executive of Nerds On Call, a computer repair company based in Redding, Calif.: “In the early days, I felt it was important to explain to an upset customer why something happened. Now I know that no customer wants to hear anything other than, 'I’m so sorry that happened. Let’s fix it.’ Why wallow in what got you there? Just make the customer happy again.”
Rachelle Ferneau, owner of Dear Coco, an artisan chocolate company in Bethesda, Md.: “Don’t underestimate the importance of good customer service — make it a priority from the start. In particular, reply to customers right away, even when your time is very tight. We make every effort to answer customer inquiries and return emails and calls within one business day. We also reach out to customers via a handwritten thank you in every one of our shipments and then email follow ups to make sure they were satisfied. Your customers will remember your prompt and friendly attention. That, combined with delivering on your product or services, will be rewarded by repeat business. Remember: it is more difficult to recruit a new customer than it is to keep a current one happy.”
Rich Kahn, co-founder of eZanga, a Web search engine based in Middletown, Del.: “Keep your customers close and listen to their feedback. They are the lifeblood of your company and pay your bills. If their needs change, be quick and flexible to make adjustments. If you do not take their needs into consideration, someone else will — and you will lose them.”
5. Don’t be afraid to change your plans.
Neal M. Bottom, managing partner of Marble Arch Consultants, a performance-acceleration advisory firm based in the San Francisco Bay area: “Your initial idea for a business will likely not be where you end up. Be open and flexible to the evolution of product or service. Remain responsive to your customers and the market, as this calibration will help strengthen your overall offering.”
Caroline Ceniza-Levine, co-founder of SixFigureStart, a career coaching service based in New York City: “With multiple businesses under my belt now, I can look back and say the best moves I made were opportunistic — following what the market was offering me, rather than trying to impose my assumptions and strategies. Launching a business always means you’ll veer off your plan. Yes, I have a loose plan — but then I follow the money. When people spend their money, that’s the best kind of feedback you can get.”
6. Small business owners must be good salespeople.
Angie Mattson, chief efficiency officer and president of Your Organized Guide, a productivity consultant in Charlotte, N.C.: “I wish someone had warned me that ‘small business owner’ is the same thing as ‘salesperson.’ I would have gotten professional sales training much, much sooner! It would have helped me figure out what I was offering, how I was offering it, how to overcome common objections and how to be more confident about my rates and fees.”
Divya Raghavan is an analyst for NerdWallet, a consumer advocacy and financial literacy website that helps consumers access business advice, personal finance tips and economic analyses.
This article first appeared on NerdWallet.com.
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