The Top 5 First-Year Mistakes.

Even once you’ve got past the starting-up stage, there are still plenty mistakes to be made, and most of them are going to be made in your make-or-break year — the first one. Here are the top five things to avoid.

Waiting for Customers to Come to You.

Too many people wait for their customers to phone, or come to the door, or whatever. They get one or two customers through luck, but nothing like enough to even begin paying their costs. These people sit around, looking at their competitors doing lots of business, and wonder what they’re doing wrong.

You can’t be like this. You have to go out there and actively try to find customers. Talk to people, call them, meet with them — whatever you do, don’t just sit there!

Spending Too Much on Advertising.

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Setting Up a Company.

So you’ve written all your plans, you’ve got any financing you need, and you’re all ready to set up your company. Uh, wait a minute… how do you do that?

The Basics.

A company is an entity, separate from you, that you need to create before you can do business. You decide what type of company it will be, you give it a name, and then you send off all the relevant papers to your government and pay any fees that need to be paid. Even for a one-person home business, it’s good to form a company — it keeps the finances apart, and means that you can sell your company to someone else if you want to. Besides, it might be a legal requirement where you live anyway.

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The Secrets of Pricing.

An often-neglected part of home business is the pricing of your services. You know what you can do, you know there’s a market for it, but do you know how much you can get away with charging, without putting the customers off? Here are a few tips to maximise your profit margin.

Find Out What Your Competitors Charge.

Ring round some of your competitors (you might want to use a fake name), and find out what they’re charging for the services you offer. You can then make a price comparison table. If you’re working in an industry where price isn’t a big thing customers look at, you might charge around the average of your competitors’ prices. If price is a big factor in your industry, play aggressively — put your table in your advertising materials, and price yourself so you beat everyone on the list (you might not be able to do this in some industries, however).

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Home Business Scams

Home businesses are many entrepreneurs’ dreams. Lots of people would love to start a home business that makes plenty of money to supplement their income or would allow them to quit their 9 to 5 job and be their own boss. Because the prospect of a home business to many is a dream come true, there are many shady characters trying to make a quick buck off of you with home business scams. Here are some tips on avoiding home business scams.

Many people who are searching for ideas to start home businesses usually come across home business scams or get rich quick schemes. Most of the time get rich quick schemes usually involve lots of money with very little effort. If you are looking for an opportunity because you need money, the last thing you want to do is give your money away for nothing.

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Preparing Yourself Mentally for Business.

People say that starting your own business is difficult. Guess what? They’re not kidding. Starting a business, in many ways, is a lot like having a child – and would you just have a child without thinking it through first? Before you get started, there are lots of things you need to think about and discuss with anyone you can.

Can You Afford to Fail?

You might have heard the old saying ‘only gamble what you can afford to lose’. Well, however you approach it, starting your own business is still gambling. A massive percentage of businesses fail in their first year. If your financial situation is such that you agonise over every small amount you spend, starting a business is probably a bad idea.

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Home Business Start up Costs

If you are interested in starting a home business, it is important to take into consideration start up costs. Many people don’t realize that in order to make money, you have to have money. Creating a budget for launching a new business is necessary; here are some tips on home business start up costs.

Most people don’t realize that in order to launch a new business the right way they need an initial budget. You have to consider the following costs; costs for inventory, advertising costs, office equipment and any other unforeseen costs that you might not think of. When all is said and done, it may take a few weeks or many months to reach profitability. For some businesses that don’t take into consideration start up costs, they may never reach profitability.

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Web Site Tools

If you are looking to build a web site and then monetize it for profit, there are plenty of web site tools available to help you reach your objective. Creating websites for profit is a common way to start a small business or supplement a full time income. Here are some tips.

Many people that enjoy computers and the internet turn to their hobby to create profit. No matter what your experience with computers, programming, or the internet is you can easily create web sites for profit with these popular tools.

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So What’s Your Idea?

You’ve got this far. It’s time to ask yourself: what exactly do you plan to do? What’s your big home business idea – and, more importantly, how is it going to make you any money? There are quite a few ways to figure out whether your idea is a good one or a bad one. Basically, it all comes down to the practicalities of the thing.

Do You Have the Time?

There are only so many hours in a day, and you want to save some of them for yourself. If you’re planning on, for example, making small products and selling them, will you really have enough time to take orders, make them, pack them up and post them? If you’re not careful, you can find yourself doing tedious work all day and all night for $2 per hour.

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Venture Capitalists and Business Angels.

Venture capital and ‘angel’ investment seems like an attractive alternative to personal loans – you’re asking people to invest their money in your business in exchange for a share of the profits. While it can cost you more in the long run, it means that you won’t be borrowing money as a loan that needs to be paid back whether your business makes a profit or not.

Venture Capital.

Venture capital is the ‘big’ option – you should only really be looking at it if your home business concept is technology-focused and would be able to make a bigger profit if you had access to better hardware. Venture capitalists mainly look for businesses that have the potential to grow really big really quickly, but will also want everyone involved to be experienced and confident.

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The Top 5 Setting-Up Mistakes.

When you’re starting a home business, it’s all too easy to make mistakes — after all, you’ve never done this before. Fortunately for you, though, you can learn from others’ errors, by making sure you don’t do any of these things.

Thinking Skills You Don’t Have Aren’t Important.

So you have no idea how to keep records and accounts, or you don’t know how to maintain a mailing list. You need to learn these things! Too many home business owners just do the things that they know how to do, and assume that they can probably get by without everything else.

You need to realise that when you’re running a home business, you’re going to need to do as much as you can for yourself, especially when you’re starting out. This means that you can’t get by if your business skills are lacking. I always say that everyone who is thinking of starting a business should take an inexpensive and quick local business course, and I stand by it — even if you think you’ll be fine, it can’t hurt, can it?

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