Tuesday, November 13, 2007

Indicators (Survival Tips for Start-Ups)

It has been nearly seven years since I started my design and marketing firm. Currently, I'm at a point of closing it down, and I'm doing some soul-searching to gain some closure on the experience. I don't consider the closing of the business as a failure, but an opportunity denied and feared by many. When I look back on how things progressed, I realize the importance of having a strong business background to better understand the normal challenges that come with starting a business.

During my struggle to keep my business in operation, I came across similar scenarios, in regard to client relationships, that formed into an informal educational experience. I mentally logged each lesson into a list of "indicators" to help other business professionals understand the numerous pitfalls that exist out there for start-ups.

Over the next few weeks, I will begin formally documenting each of these indicators, which will be later compiled into a document to help start-ups, especially creative shops, look out for challenges that may counter their growth plans for their business.

INDICATOR #1
The Discount For The Deal Scam

The scariest thing about starting a business is the reality of being vulnerable. In fact, the risk involved with starting a business is more associated with being vulnerable than anything financial. For the first time ever, or in a long time, you have to build relationships from virtually nothing. As with most relationship-building experiences, the first responders are always the most dangerous ones. It never fails that one of your first, to be followed by many others, opportunities results in this statement, "If you can do this for me at a substantial discount, there will be more business coming down the pipe".

The English translation for this is, "Because you need the business, I'll do you a favor and give you my business, at a discount of course. And to not make you feel like an idiot, I'll promise you more substantial business later that will obviously never come to you". The Street translation for this is, "I need a sucker. Have I reached the right person?"

The lesson to be learned from this challenge is simple. Why would you take the time to develop a product or service, for a certain type of customer, at a specific rate, with set financial goals, to ruin the plan on the need to stay busy. By taking on these projects, you keep yourself from analyzing how successful your actual product or service is in the market. Additionally, you can easily fill your schedule with these types of customers, which will eventually decrease the possibility of you landing that real client who needs more time to understand your worth to them.

I have found that the true process, which is disguised by this scam, comes from working on small, but profitable projects, which can build credibility with the client and their partners. The fear of going small to big is a normal feeling, but it’s the only way to establish trust and brand-awareness with your clients. However, your price should never change, and neither should your mission.

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