1. Don't waste money on advertising. I must have spent thousands of pounds over the years on adverts which NEVER paid for themselves. Don't make the same mistake! Instead, concentrate on getting editorial and having products featured on shopping pages of magazines and newspapers. This kind of publicity is seen as a form of recommendation and is far more effective than advertising. It's also cheaper and a lot more fun! Recommendation (or perceived recommendation) is what you need to make your business stand out from the crowd. After all, anyone can put together an advert - it doesn't mean that you are actually any good. I really recommend the PR advice of Paula Gardner at www.doyourownpr.com. These days, I never pay for advertising; I put all my efforts into PR and am having far more success as a result.
2. Don't spend too much money on stock. This is one of the major causes of bankruptcy amongst new businesses. It's tempting to think that you have a keen eye for a bestseller but it isn't always the case, and you could get stuck with lots of stock you can't shift. I used to order more than I needed just so that I didn't have to pay for carriage (above a certain amount, orders are usually carriage-paid) but soon realised the foolishness of this approach. It's not worth risking bankruptcy just because you have an aversion to paying carriage charges! Buy as little as you can each time, and build the cost of delivery into the selling price. This way, it doesn't matter how little you order as you have covered the carriage costs anyway.
3. Create an ecommerce website. In a niche market, you have to make the most of every sales opportunity and the internet is a great way of reaching a bigger audience. It's really cheap, there are virtually no overheads once it's set up and you can reach people all over the world. Mine uses off-the-peg ecommerce software called Actinic (www.actinic.co.uk); the 'look and feel' has been created by the web designer, using my own ideas. I'm very happy with it - it is economical and works well. I've heard horror stories from people who have had expensive but ultimately flawed ecommerce solutions made just for them, so this off-the-peg package has been great for us. My website (www.periodfeatures.net) cost around £2000 to set up and online orders now make up around 20% of our turnover, although this figure is rising fast as we become more widely known. It's actually very easy to create and run an ecommerce site, although I never would have believed it a few years ago when I was a complete novice!
4. Get the accounts on the computer as soon as possible. Make sure you keep up to date with the accounts and you'll avoid a great deal of stress. I use Quickbooks, but whatever package you use, make sure your accountant is familiar with it as you're sure to need help from time to time. I also needed help setting it up initially, so my accountants were invaluable at the time. Half an hour to an hour each day helps me to keep on top of the paperwork.
5. Employ staff as soon as you can afford it. This helps you to avoid burnout and frees up your time to do what is really important, like bringing in more sales. When you are running your own business, all the little things can stop you doing the big things. It's important not to let this happen. Also, it's important to realise that you're not the only person who can do what you do. It's a great relief to be able to distance yourself a little from your business and realise that other people are just as good (better, even!) at serving in the shop, advising customers, etc. It's not healthy to try to do everything yourself, but it's a common mistake when you start your own business. Learn to let go a little and you'll be much happier for it.
6. Take every chance you have to exceed expectations! And yes, I know that makes 6 top tips, but it's a good example of what I mean. This is our company motto and people really appreciate all the extra effort we put in.
Hi Lucy,
I was recently debating how much stock we should order, when I remembered your wise words!
So I ordered as little stock as I needed! Thanks for your common sense advice for small businesses.
Keep up the good work and best of luck with your business.
Posted by: Sophie Baxter | September 08, 2006 at 06:37 AM
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Posted by: Alexrpz | October 02, 2007 at 02:45 PM