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Thread: Mistakes running a small business

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    Mistakes running a small business

    A regret more than a mistake ... not "taxing" myself every month ... something I would advise anyone running a small business ... no matter how small like 1 % ... its about getting into the habit ... you will never have enough money to save money ... every month there will never be enough money ... so why not just take a little and put it away for a rainy day.

    Working too long and hard ... When I think back to some of the amazing places I have worked ... for example I spent 2 years on a farm in the Drakensburg building a water treatment plant ... we ate fresh scones with strawberry jam and cream every single day ... enjoyed farm breakfasts and dinners ... I have completed 4 projects in Cape Town and only been to the Cape once on holiday ... I spent 10 years building water and waste water treatment plants in literally every small town in KZN/Swaziland/Mozambique ... had access to the river and dams ... yet I didnt even own a fishing rod or an off road motor bike ... instead just chasing the project completion date ... instead of taking a few days to enjoy the surroundings ... it would be hassle hassle to the next project ... before I wiped the shyte my eyes ... 10 years had past and I was sitting on the street homeless and without a family ... I thought all those long hours and hard work was to keep the family ... in the beginning I only had bad things to say about her ... until I realized it wasnt only her sitting waiting ... but my kids ... if you are young and starting out ... your family is priceless ... jobs will come and go.

    Investing in expensive machines and test equipment and testers ... buy good quality equipment that you are going to use on a daily basis but dont waste money on shyte you dont actually need ... they have absolutely not value when you try sell it.

    Managing finances ... no matter how much money you make ... be it R100 or R100000.00 ... its not how much you make ... but what you do with it.
    I have been spoilt in the sense that there has always just been enough to get by and buy the toys I wanted ... until I had an accident ... every penny had to be counted ... what I would do is put the money on the table and allocate a portion to food ... accommodation ... fuel ... entertainment ...etc ... within a couple of months I started seeing the light at the end of the tunnel ... I just wish I had kept at it ... redit card sand overdraft facilities are designed to make people like me poor for the rest of our life ... that why I no longer have credit cards or overdrafts or accounts at wholesalers ... smart "businessmen" who can handle their financial affairs ... can utilise and grow with these facilities ... but people like me who like to spend money and live at the edge ... not a wise idea ... as we all know by now ... the best tradesmen dont just become smart businessmen ... in fact the biggest problem with small businesses failing is because people who are good at what ever it is they do ... dont automatically become smart businessmen.

    Managing the admin side of a business ... 30 years later I still do all my own admin from quote to service sheets to time keeping to material costing and invoicing you name it ... dont be a fool ... get a admin clerk and use them ... if they have time to sit and play on the computer or cellphone ... get them to collect and deliver stuff to site to keep the important money making part of the business flowing ... we all know that wholesaler visits are a waste of time and money ... yet everyday I see bakkies full or employees pissing many against the wall from early in the morning.

    Another waste of time is teams sitting in vehicles while people buy lunch ... and you wonder why customer complain about being charged 3 hours for 15 minutes on site ... it boils down to bad management ... that simple ... if your manger is ducking and diving all day ... how do you expect the teams to function at full capacity.
    Comments are based on opinion...not always facts....that's why people use an alias.

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    Quote Originally Posted by ians View Post

    Managing the admin side of a business ... 30 years later I still do all my own admin from quote to service sheets to time keeping to material costing and invoicing you name it ... dont be a fool ... get a admin clerk and use them ... if they have time to sit and play on the computer or cellphone ... get them to collect and deliver stuff to site to keep the important money making part of the business flowing ... we all know that wholesaler visits are a waste of time and money ... yet everyday I see bakkies full or employees pissing many against the wall from early in the morning.
    Having an Admin person allows your supplier to deliver to the office rather than wasting time hanging around in wholesalers

    With regards to putting away for a rainy day - As humans we have a habit of living to your income - A salary increase only last 3 months and then you have adjusted your lifestyle to meet the new income. The trick is to break that habit and ignore increases and ensure it goes towards a saving account or extra into bonds against debt.

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    Sitting wasting time and money today ... filing out job cards and linking supplier invoices to job cards and timesheets to job cards ... my favourite pass time ... NOT ... but I suppose no invoicing no money.

    Trying to do everything yourself ... not only wastes time ... but it also takes you away from focusing on what you do best ... the projects are piling up ... its getting so out of hand ... beside all the customers I have had to turned away ... we now getting to the point that the customer who I am trying to hang onto are also get impatient.

    I thought by the end of July I would be on top of the work load ... ready to start taking on new projects with existing customers ... we now in the middle of October and I still have projects on a list which I havent even started (created since January) ... its no even funny anymore ... rather embarrassing.

    I have 4 projects on the go at the moment 2 are almost complete ... but because I had to do some work on a site where they are upgrading stuff and moving stuff around .. I had to go spend a week on that site ... while doing that another job came up and I had to spend a week on that site to fit in with the school holidays ... I keep thinking maybe employ another person to assist ... then I think back to all the labour issues I have had when I grew this business ... trying to manage 70 electricians on a site ... never again ... maybe just one more ... the catch is ... as you grow so your commitment to your staff becomes a reality ... end of year leave and bonuses become a reality ... you start spending more time running around behind the staff ... having to check up on them.

    I have considered using sub contractors ... the catch with that is trying to manage the theft of equipment and them trying to steal customers.

    its like a bad dream ... you either too small or need t go big and take the bull by the horns ... you cant go a little bigger because the overheads of premises and admin staff and more vehicles and equipment ... start killing your profits.

    The difference between where I am now and was 30 years ago when I started ... I know what to expect ... do I really want to go down that road again ... When I started I could tackle anything thrown at me ... had the energy and will power to get out and take on the world and not let anything get me down ... I have become too wise and soft as I get older.
    Comments are based on opinion...not always facts....that's why people use an alias.

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    Quote Originally Posted by GCE View Post
    Having an Admin person allows your supplier to deliver to the office rather than wasting time hanging around in wholesalers

    With regards to putting away for a rainy day - As humans we have a habit of living to your income - A salary increase only last 3 months and then you have adjusted your lifestyle to meet the new income. The trick is to break that habit and ignore increases and ensure it goes towards a saving account or extra into bonds against debt.
    I have been paying off any form form of debt rather than trying to save money ... credit cards and overdraft is paid up ... vehicles paid up ... all my equipment is paid for ... and I have just over a million invested in my property with a small bond ... which sounds like a lot ... but how long would a million last in this day and age ... and I would be homeless because my house would have to be sold to get the money ... I am watching the houses selling like crazy around me ... which is a little concerning ... are people trying to get out before it is too late ... are they trying to get money out while they still can ... all these kind of things have crossed my mind.
    Comments are based on opinion...not always facts....that's why people use an alias.

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    One way of surviving as a solopreneur is to outsource services.
    Be the adviser and link between the customer and the contractor.
    At our age and with the knowledge and experience that you have, why do you want to do the work yourself?

    By collaborating with trusted and competent people who can do the job, you can become like an agency and just live off the commission or mark-up on the services that you provide? You source and check for quality and they do the job (with their own tools).

    Maybe get hold of a bookkeeper who will do some of your admin and also take messages for you.
    Excellence is not a skill; its an attitude...

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    Quote Originally Posted by Blurock View Post
    One way of surviving as a solopreneur is to outsource services.
    Be the adviser and link between the customer and the contractor.
    At our age and with the knowledge and experience that you have, why do you want to do the work yourself?

    By collaborating with trusted and competent people who can do the job, you can become like an agency and just live off the commission or mark-up on the services that you provide? You source and check for quality and they do the job (with their own tools).

    Maybe get hold of a bookkeeper who will do some of your admin and also take messages for you.
    I quoted for a job a while back in an upmarket area ... there was a consultant on site ... I was asked by a friend to advise another friend ... the customer did not inform the consultant that I was going to attend the meeting ... when the consultant and the building contractor arrived in their 2-3 million rand vehicles ... I knew straight away there wasnt going to be much money in the work itself ... I have since heard they are around R500 000.00 over budget ... the job is still not complete and they are not very happy.

    You know when you start advising the customer of challenges they are going to face ... which weren't discussed prior to your visit ... best you keep walking ... I didnt waste much time preparing a quote ... I knew if if I added 50 % profit and did a per point estimate ... I certainly wasnt getting the job ... one of the reasons I dont sub contract to builders.
    Comments are based on opinion...not always facts....that's why people use an alias.

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    Diamond Member adrianh's Avatar
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    Quote Originally Posted by Blurock View Post
    One way of surviving as a solopreneur is to outsource services.
    Be the adviser and link between the customer and the contractor.
    At our age and with the knowledge and experience that you have, why do you want to do the work yourself?

    By collaborating with trusted and competent people who can do the job, you can become like an agency and just live off the commission or mark-up on the services that you provide? You source and check for quality and they do the job (with their own tools).
    This is also a sure way to lose everything. People are happy to steal your customers, your IP and your life.

    ....be very very careful who you get in bed with - they might just steal the entire bed from under you.

    One of my employees walked out with all my IP and went over to the opposition. (Of course I couldn't prove it) I am very weary of dependencies....and also people who have similar markets/interests as mine.
    “Why, sometimes I've believed as many as six impossible things before breakfast.”
    ― Lewis Carroll, Alice in Wonderland

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    Diamond Member Blurock's Avatar
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    Quote Originally Posted by adrianh View Post
    This is also a sure way to lose everything. People are happy to steal your customers, your IP and your life.

    ....be very very careful who you get in bed with - they might just steal the entire bed from under you.

    One of my employees walked out with all my IP and went over to the opposition. (Of course I couldn't prove it) I am very weary of dependencies....and also people who have similar markets/interests as mine.
    There are many consulting companies, engineers, designers, architects etc doing just that. Many businesses do not grow or are not successful because the owner wants to hang on to everything. The idea is to work smart and not to work harder. Associate yourself with a quality team and with collaboration it can turn into a win/win where one guy (the expert) source the business, and others do the work.

    As a solopreneur you have only two hands and 24 hours in a day (disregarding sleep time). The guy doing the installation or work does not have the time for sourcing new business, meetings, admin and costing etc. That is the work of the professional who does not have time for digging trenches and being tied up in the actual manual work.

    Such a partnership can give young artisans (those who want to work) an opportunity to be their own boss, but not have to put up with all the admin and sourcing of business that goes with it. The professional can assist them with advice and gets a cut from the business referred to them, paid by the customer. There is a slight difference in working with other business owners and working with employees. Is it attitude?

    Contracts should include a non-disclosure and non-circumvention clause so that poaching of staff and/or customers will incur heavy penalties.

    I have seen that work in practice and in fact my primary business has only one employee, me. I collaborate with my competitors and other businesses to give the best solution to my customers. My customers know what to expect and come back to me because of quality service.
    I work from home and even have time to talk nonsense on the Forum.
    Excellence is not a skill; its an attitude...

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    Agreed....but...one has to be careful. Many businesses fail because their ideas, products, services etc. got stolen from under them. I spent a lifetime in corporate IT and I saw 1st hand a couple of times how 3rd party support / outsource programming companies stole businesses right from under the nose of their "clients". When a company has a vested interest in your market you have to be careful.

    I do a lot of manufacturing now. Some industries are rife with product theft. Metal spin casting is a case in point - If you want your product to end up on the shelves of every shop in town then send it to the contact spin casters (LOCAL not even Chinese) - They copy everything they can lay their hands on and sell it via their own channels. I manufacture models - Everything I ever made has been copied (LOCALLY by staff and opposition). These days I NEVER publish my work on social media because it gets copied immediately.

    Outsource the stuff that can't harm your business - don't outsource your IP related stuff.

    This brings us back to the age old problem of finding good help....that won't steal you blind or break all your stuff. I have more work than I can handle but I've become extremely weary of people - there is always an angle or some issue - people can't just do their work and get on with it - you always end up being a damn social worker / marriage Councillor / pseudo ATM / etc. - I would happily pay a person a fair salary if their could think for themselves and just get the F on with it!
    “Why, sometimes I've believed as many as six impossible things before breakfast.”
    ― Lewis Carroll, Alice in Wonderland

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    Diamond Member Blurock's Avatar
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    Outsource the stuff that can't harm your business - don't outsource your IP related stuff.
    Agreed!

    Never outsource what you cannot control. You are still ultimately responsible for the quality of your product or service.
    Excellence is not a skill; its an attitude...

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