December 22nd, 2010 Posted in Business, Professional | 1 Comment »
As 2010 winds down I’ve decided to put together a list of lessons learned while running a business. Hopefully this list can serve as a resource for other entrepreneurs looking to start their own gig in 2011.
Always, always, always get a signed contract for the work you are about to do.
Even though contracts aren’t worth the paper their written on most of the time, it’s always nice to have that security and a document to hold the client to. Somehow the signed contract for a really large project went missing this year, but luckily the client held to his end of the agreement and paid for the project.
Do not make the final payment due when the site “launches”.
I have learned this lesson over and over again and I finally have found a solution. I was kidding myself thinking that every project I started would get designed, developed, and launch without a hitch, and every project seemed to drag on, and on, and on with last minute tweaks and details. This absolutely kills your cash flow. Working on a project for 90 days on a 50% deposit is no way to be profitable. After 2.5 years I have decided to put a 60-day clause in my contracts. If the site does not go “live” within 60 days, the client still owes the remainder of the balance. I’ve come to the conclusion that most clients think once they pay the final invoice I’m going to magically find an island in the Bahamas never to be heard from again…I wish.
Make the contract be the “bad guy”
I’m always afraid that if I tell a client “I can do that, but it’s going to cost extra” they’re going to flip out and think I’m nickel and diming them to death. I’ve learned from several business mentors that you must always spell out the statement of work in the original contract meeting and then stick to it. If the client wants an added feature that is going to take you 5 extra hours to develop, you resort back to the contract and nicely explain “Mr. Client, I’d be happy to install a calendar that shows your upcoming events, but if you’ll remember all extra features outside of the original contract are billed at X amount a hour”. The client can’t get upset (well they can, but it won’t be justified) because it’s something they’ve already agreed to in the beginning.
Believe in your value
As web designers/developers/internet marketers, we offer an expertise service. Sure there are “do-it-yourself” solutions out there, but take a look at the DIY results vs a professionally designed and thought out website. I’ve let myself believe that if it’s easy for me, it’s easy for everyone…which is most certainly not the case. They are calling you because they can’t do it (some claim they can but just don’t have the time) themselves. You are providing a professional service; believe in your value. If someone laughs (I’ve had this happen) at your hourly rate they obviously don’t understand what it takes to run a business. A $90 hourly rate isn’t something you just pull out of thin air because you want to “make” $90 an hour. It’s a figure you’ve come up with (hopefully) that factors in fixed costs, variable costs, your average hours spent working on actual work (you’re not going to bill 40 hours a week) and several other factors based on your business.
Do not let your client’s crisis become your crisis.
I’ve pulled more all nighters running my own business than I did in college and grad school. I’ve learned that although you want to provide excellent service to your clients, they should also respect your time. If you tell your client the site will launch on Jan 15, 2011 and they wait until January 14, 2011 at 11:59pm…they aren’t getting a launched website on January 15. Put due dates on content and explain to the client that for every day they are late on the content it pushes the launch date back. Do this upfront in the contract of course. Don’t surprise them with this after they miss the deadline.
Release clients who burn up your time.
We all take that client in the beginning phases of business because we want the work, but there comes a time in your business where you just can’t handle the “Hey can you go in and change this real quick?” e-mails. Trust me, 3-4 “Hey can you fix this…” e-mails can eat several hours of your time. If we were playing poker, I’d tell you “Know when to hold em’ and know when to fold em’”
Hopefully this lessons and advice help you and your ventures in 2011!
If you’ve got your own lessons, be sure to add them in the comments!
Tags: Business, lessons learned, mediaplug