This is the seventh in our series on the 10 C’s to Building Momentum. This will be delivered in two parts, one this week, and one next week.
There is a thinly disguised multi-level marketing company that will have you believe you can start selling their product today and be driving around in a brand new BMW in one to three months. What they don’t tell you is that you have to invest a considerable amount of money to get started, and you must generate massive sales in order to get that BMW…and what they really don’t tell you is that you have to pay for it from your earnings.
If your antenna goes up when you hear about “get rich quick schemes”, it should. The fact is, starting a business requires a considerable investment of time and money. Technology being what it is, you can start a business today with less capital than in the past, but you still must invest before you reap the benefits.
Before you begin, set up a budget. Allow for the proper tools, training, and team players. There are many places to save, but be judicious. When it comes to the foundational pieces of your business – licensing, legalities, technology, and programs that are critical to your business – you may have to spend more to get good quality.
Here are some areas where you should invest in quality components:
Licensing / Insurance – Do not try to short circuit licensing, and make sure you have the proper insurance plans in place. The penalties for not doing these correctly far exceed the cost of compliance.
Legal Formation – There are many do-it-yourself sites out there, all willing to take your money but offering no solid legal advice. Invest in a good business attorney. Setting up your business correctly on the front end can save you thousands on the back end.
Accounting / Taxation – Unless you are a CPA, you should think twice about doing your own taxes. The laws are constantly changing, and this is one area where a dedicated professional is well worth the investment. Not only can they help prevent penalties, they can also help you capture legitimate cost savings.
Technology – If your business operates online in any form or fashion, make sure you have the right technology to support it. You can’t run a business on a Commodore 64. Foundationally, you will need a quality website. Websites can range from $100 to $100,000 or more. Get the best quality you can, but steer clear of either end of the scale – too cheap, and you could be like one lady I recently heard about. In an effort to have a cheap website built, she engaged with someone in another country whom she had never met. The site was never completely finished. It looked horrific and functioned even worse. She discovered that when someone signed up on her mailing list, the names were actually going to this person in another country who could no longer be found. She ended up spending more to have it rebuilt than she would have spent to do it right the first time. It also cost her a year’s worth of revenue by virtue of the fact that it simply did not work. For most business owners, $350 to $1500 is a healthy estimate.
You will need a quality accounting and e-commerce platform, marketing tool, database program, and dependable virus software. In the online business world, the list is gold, so do not underestimate the value of your Customer Relationship Management (CRM) system. That said, there are some great (and free) marketing tools available. Spend money on the foundational technology pieces, and then experiment with the free tools that are non-critical to your business.
(Continued next week…)