As a small entrepreneur, you learn about your new business while keeping the safe and steady income of your main job. You start small and build your business gradually. This limits your risk in case your new business fails. In exchange for taking less risk, you must work harder. You must be dedicated, willing to come home after a full workday and keep going on your side business. It takes discipline, tenacity, faith, and a very understanding family to manage your business while keeping your day job. It’s not easy to work all day at the office and then go home at night to work on your own project. The competition for your time can become intense. But if you create a plan and follow it in an orderly fashion, you have a very good chance of eventually succeeding.
Mastering the essential skills
To succeed in any business, you must know and do certain things very well. For starters, you must master the fundamentals of direct marketing. Direct marketing is by far the most efficient way to sell products and services profitably. It is essential for small entrepreneurs because it allows them to break into their market without losing a fortune on general advertising.
You must also learn about the kinds of products the marketplace desires and which price points are ideal. You must know how those first sales are made — the specific marketing techniques to employ to generate a sale without spending too much money acquiring the customer. You must understand the “back end” of the business, too (how to upgrade a new customer into buying higher-margin products).
Learning about the market you intend to enter can also be done while you still have your day job. It is relatively easy to take advantage of the Internet or use flea markets to test new product ideas cheaply. And you can learn the backend of the business by becoming a customer of a company selling a product similar to the one you want to sell. Create your backend strategy by seeing the kind of offers you get from them after you make your first purchase.
Avoiding the most common start-up mistakes
There are several pitfalls in starting any new business. But as a small entrepreneur you can easily avoid them. The most common is dictating to, rather than listening to, the market. New entrepreneurs often waste precious time and effort hoping to bring something brand-new and exciting to the marketplace. But if the product doesn’t exist, there is usually a good reason for it. It’s better to start with a better or cheaper version of a product that is already known and in demand.
The next-biggest mistake new entrepreneurs make is spending too much time and money on non-essentials like business cards, photocopy machines and fax machines. Keep in mind that the fundamental activity of a business is the commercial transaction. Your best chance of success comes when you devote 80 percent of your initial resources to making the first sale.
Master the necessary skills, avoid the pitfalls, and your business will grow. At some point in the future, you may realise that you are making more money from your second income than you are from your first. That’s when you may choose to drop your “day job.”
Justice Mandhla is the author of Business Prep Guide and he spends a great deal of his fulltime writing days researching and writing about business preparatory strategies.
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