Thankfully, things are going very well for my new business, but I’ve experienced failure in two previous business ventures, as well as huge losses and a risk of bankruptcy. Based on all of my experiences so far, here are my six start-up tips.
If you start a business with a friend, you’ll fall out eventually. Sole ownership and responsibility gets past a tremendous amount of pitfalls and issues that you just won’t anticipate.
Never take a charge on your house and try to avoid providing more information than a lender requires. The bank manager only looks at the information you present him with, so just give him what he wants and leave it at that. When my first business failed, my partner could not find a job and the bank chased me for the total amount of our personal guarantees – which equalled £40,000 and took 10 years to clear.
Do your accounts, get invoices out promptly and don’t accept being messed around over payment. I remember sitting in our largest customer’s reception waiting for a cheque to be written and the receptionists sneering at me. They could afford to sneer, they’d been paid – my staff and I hadn’t. And ask your accountant to visit you every quarter to make sure you are on top of everything. If you wait until the year-end, you can be looking at information up to 18-months-old.
It’s much easier for a small business to lose a thousand pounds a month than to make a thousand pounds profit. Make sure you are on the positive side of that line. If you are working hard, the least you can do is make a profit.
Think of how much you appreciate being paid on time and the goodwill that makes you feel towards that customer. Now flip that on its head. I prefer to be known as a good payer than a bad one, and in these tough times your bill-paying performance will feed directly into the amount of credit you will receive from your key suppliers.
It’s impossible to place a value on a hard-working employee who cares about your business and where it’s heading. Spending extra on wages for certain skill sets or talents that are suited to your business can be the difference between 5% growth and 20% growth in a start-up’s early years.
John Sollars is an expert contributor to the IT Donut and MD of Stinkyink.com
Hardware warranties play a massive role in minimising early start-up expenditure. They provide not just after-sales value, but also security against future unexpected costs.
A 2009 survey conducted by Lexmark (State of Printing) suggested that 78 per cent of customers expected to have to replace their printer within five years. Printer manufacturers have attempted to assuage these consumer fears by providing guarantees lasting up to five years for most popular printers (excluding budget sub-£50 machines).
It stands to reason that you are going to want to protect this, so you’ll need to know how the terms of your warranty are affected.
Your warranty will typically be void if:
Although it is slightly annoying to know my Oki isn’t covered for lightning bolts or flash floods, these are nonetheless reasonable terms. However, there is one area of huge controversy that can affect your warranty – using third party printer consumables
Third party cartridges, as feared by the vast majority of customers, can have implications for your warranty, wholly dependent on the stage of the warranty you are in.
Standard warranty typically covers the first year’s performance of your printer (or a high volume number of prints stated in the warranty conditions, whichever occurs first). It is illegal for a manufacturer to void this standard warranty because of third party cartridges. Rest assured, they’ll try to tell you they can, but you’re protected by this piece of legislation:
Magnuson-Moss Warranty Improvement Act Chapter 50 – Section 2302
(c) No warrantor of a consumer product may condition his written or implied warranty of such product on the consumer's using, in connection with such product, any article or service (other than article or service provided without charge under the terms of the warranty) which is identified by brand, trade or corporate name; except that the prohibition of this subsection be waived by the commission if:
Typically requiring registration with the manufacturer to activate, it is hazy at present whether these optional, manufacturer-provided, warranty extensions are exempt from the aforementioned Act. Do not be surprised if legislation soon moves to block this common practice by making the Act clearer.
This is unavoidable and places even more importance on the retailers from whom you source consumables. Always check for evidence of quality testing, performance guarantees and testimonials on customer service before buying. You are paying money in a highly competitive environment; these should be provided as standard.
Ultimately, third-party cartridges should be perfectly reliable (it’s so rare I have only encountered it once in the past year) you just need to be careful shoppers.
At my company, Stinkyink.com, we are in contact with manufacturers for explanation of how they can legally enforce this, and we will get back with their response if they ever do provide a straight answer.
Have you had a bad experience with a manufacturers terms and conditions? Post below and see if anyone else has not only gone through the same thing, but if they have suggestions to help.
Like it or not, computer systems are a part of everything to do with operating your business and are crucial to its success. An ideally tailored system, one that is adaptable, usable and affordable, will transform your business and be a huge enabler for future expansion. No matter how talented you and your staff are, a poor system will hold you back.
I certainly know that the recently introduced backend systems at my business Stinkyink have exceeded all expectations in how we can adapt and scale them to our changing needs. And I believe it is possible for any start-up or small business to be just as fortunate.
While the above statement is true to a certain extent, don’t let it control the direction of your business. An inflexible system, while satisfying your initial needs, can hold back a new business idea for pushing yourself to the next level. This “future-proofing” is key, especially as a start-up. The path your business takes will rarely be the one you imagined, and this highlights the importance of being supported by one that can survive in a changing environment.
The old systems and their providers had no intention of implementing features that are now crucial in all areas of our business and the backbone of the excellent service we provide. We would still have been good on the old software, but now we can be great.
Adaptation and scalability are key for a backoffice system, but there are other critical success factors. Dedicated support from the software supplier, knowledgeable employees and – crucially – an ability to take criticism and user advice, should all be part of the service. The sheer scope and reach of some backoffice systems, depending on the complexity of your business model, make training a necessity, and the quality of this training will heavily impact how much you get out of your system.
The best way I can sum up the ideal support team for your backoffice system is that they take any criticism or request that you, the user, highlights, and see it as an opportunity to enhance the package, for others as well as you. We are lucky enough to have that with our supplier, AxisFirst, and the efficiency gains we have experienced with little tweaks to the original system really are priceless.
I am all for loyalty, but the sooner you can implement your ideal backoffice system, the better. Even if your existing one performs well, question it.
It is a competitive market, so look around. You might be surprised how the system developers begin to think outside the box and things become possible when you see what competitors are offering.
Investment is a common term for most start-ups, usually in the context of technology, buildings or staff training, but what about philanthropic investment? And in particular, should a start-up look to give to the local community when finances are usually so tight?
We’re in the midst of a recession and that doesn’t just affect commerce, but also local activities and groups. Any assistance you can give to your local community will surely be appreciated and remembered, for example, sponsoring local events or sporting teams. It need not be financial; products, time and manpower are just as valuable a commodity for some projects.
To my mind, if you can afford even a small input, there is no reason not to invest – a humanitarian deed for the day is a great way to live. But as with any investment, there must be a return – mustn’t there?
A truly philanthropic investment would yield no direct financial return for your business, but with my most cynical of capitalist hats on, why be in business if not to make money? Yes, do things for the community, but away from work, with your own time and your own money. After all, without profitable businesses, there is no economy, no livelihoods and no thriving communities in the first place.
But there are less tangible returns that you might gain, for instance, on the public relations front. Everyone loves a ‘feel good’ story and if you have the opportunity to make a difference in your local community and can publish it correctly, this charitable activity can do wonders for your reputation.
Take Christmas, for example. If you normally send cards to customers and suppliers, think again. Instead, perhaps you could email everyone and explain that you are donating £xxx to a local cause. Everybody wins, including the environment.
Breaking News: “Lovely generous business gives money to [insert charitable cause]” . Who doesn’t read it and replace the “Lovely generous business” thought with “looking for some public good will” judgement. We all do. And does this feeling really disappear when it is a start-up or small business? Has today’s hurly-burly environment removed our ability to see a selfless act and not be suspicious?
Personally, I think all businesses should make an effort to give something back to the community, whether you are resident there or if your business is simply based there. My employer invests an awful lot in the local Alveley community in Shropshire, with barely any of the investments receiving mention outside the parish. But it’s worthwhile because we see the appreciative faces, receive the handshakes and know our small contribution enabled an event to get off the ground and realise someone’s dream.
Yes, businesses exist to make money, but there is no need for that money to sit in a bank when it could be put to good use.
Environmental printing is no longer an oxymoron and there are steps you can take to be greener in your office. Simply couple these additional pointers with my cost saving tips and enjoy these additional benefits for both the environment and your wallet.
Getting rid of bold headers or text will cut down on ink usage for each page, especially in often-printed documents. You would be surprised how much ink and toner you can save by shrinking your letterhead by 20% or switching to black and white formatting! Further formatting such as reduced margins can really get the most out of every page you print and limit your paper consumption.
Efficiently presenting all the information on your pages is a great way to limit any paper and ink waste. Consider cutting down your font size and looking at physically thinner fonts (such as Century Gothic) to make the initial size of your prints smaller. Go even deeper and look at the actual content bring printed, is it presentational work or general office documentation? Can it be reworded or broken into short bullet points to be condensed on the page? This small amount of time instead of just hitting Ctrl+P will help you save paper.
Quite a few machines now provide both standard and high capacity cartridges. In a significant number of cases, the XL capacity cartridges are no physically larger than their standard capacity counterparts; they have simply been filled completely. Purchasing these cartridges will give you cheaper running costs and fewer waste cartridges being generated.
Whether in your existing machine or finding it as a feature when browsing for a new printer, standby modes for laser printers are an amazing way to limit your energy consumption. Keeping the machine active and ready-to-print drains energy throughout the day, and finding a printer which limits power needed to maintain this state is inherently important for any green-aspiring office. With some machines using a little as one watt in standby, yet going from standby to print-ready within five seconds, you can save energy without experiencing delays in your office printing.
Leaving the office overnight or for a weekend? Turn your machine off when you know it is not in demand and fully rid yourself of wasted electricity.
6.1 Paper and packaging
Don’t just bin the draft documents you have printed, get an office recycling box and encourage the recycling of all your non-confidential paper, either for re-use on the blank side, or for pulping. Plus manufacturers now produce environmentally friendly packaging which can be thrown into recycling with the minimum of fuss.
6.2 Cartridges
Continue to your cartridges. Binning them after a single use should be a crime within the industry. Keep that plastic casing away from the landfill as long as possible by recycling. There are huge numbers of recycling companies in operation, and many will often pick up your cartridges free of charge and get them back in circulation after cleaning and reconditioning. If you have one of the few cartridges not valid for recycling then it probably means it has literally no technology within it, and is just a plastic casing. Just take it to your closest plastic recycling bin and do your part for the environment.
6.3 Your machines
Under the Waste Electrical and Electronic Equipment (WEEE) direction manufacturers have to take responsibility for printers at the end of their life cycle. Make sure you get your machine collected when replacing your office workhorse and ensuring minimum material ends up in landfill.
Got any great green tips to add to this list? Leave your comment and help us all be better for the environment.