1) The Business’ Money is Not Your Money - If you don’t have a separate bank account established. Stop right now and get it done. Your funds need to be separated for tax and sanity purposes. If you have a separate bank account set up, you can pay yourself a fare wage depending on your business set up. I’ve seen too many people co-mingling funds or thinking they have more money than they do. Your business is there to support you and if it doesn’t work, you need to keep your personal finances clear. When your business is successful, it will be taxed as such and you’ll need to be able to prove write off expenses including your income.
2) Know Your Numbers – From Day 1, you should know what you need to make in a month and year to live to your standards. Set a budget and proforma. How much many clients or widgets do you need to sell to break even? Have you factored in taxes? Where in the year are those big-ticket expenses (insurance, equipment upgrades, etc)?
3) Know What You’re Offering – If you can’t clearly articulate what you do in two sentences or less, you need to spend more time or work with someone to help you get there. As a consumer, I decide in ten seconds if I want to work with your or buy from you. If you can’t get your value across on your website or in person, your message will be lost on your customers and it will make the next item that much trickier.
4) Set Your Prices and Stick to Them – Nothing frustrates me more than the business owner who changes their price every time they get a customer or client email that is a smidge critical. When you adjust your prices, you’re communicating uncertainty and a lack of clarity around your business. Before you take on a client, factor in your worth and the time and resources needed to support your service or product. Know your competition and industry standards and price accordingly. In no way should you be the lowest price in town. All that does is create a race to the bottom of the barrel and the clientele you’ll bring on will expect low costs and will not be in the mindset to increase what they pay you.
5) Define Your Policies and Procedures – Draft up your contracts and agreements and make sure you’re comfortable with them. What about your refund policy or no-show policy? How do you handle contract violations? There are great resources out there for templates and I certainly advise working with a lawyer in your industry to make sure your butt is securely covered.
This is just a snapshot of what to look out for. If you have any others to add, feel free to post below.