5 Reasons why most people fail at a Startup
Seems ideal doesn’t it, wake up slowly, the commute is a few paces to your desk, and you can be in your Pyjamas all day and no-one cares. To be able to say goodbye to public transport, rising fuel costs, car insurance and HP just to get to your desk each day, not to mention getting completely away from office politics and being your own boss.
Millions of people now work from home and many more are seriously considering ways to make money online.
You would think that people would fight hard to get these working conditions yet so many fail working from home and here are our top reasons why.
“Everyone wants to go to heaven, but no one wants to die”
You may not know it yet, but you may be one of those people who just need the alarm clock, and the regularity of the rush hour and a boss to motivate you to do what you need to do. There is nothing wrong with that per se, just recognise it, live with it, and do whatever you need to do get you to where you want to be.
The worst and most scathing boss is you! Anyone who has a modicum of success working from home will know that the internal fight inside between being what you consider is a hard working and successful person, and a complete slob worthy of nothing more than a cardboard box on the side of the road is the biggest strain on your nerves there is.
Working from home knows no extremes, one day you kill it, working 18 hours nonstop where you don’t even remember the kids coming home from school and what you shoved in your mouth all day, the other extreme you didn’t even make it out of bed to even brush your teeth. Working in an office keeps people regular working from home you have to take care of your health somehow.
The culture shift in the discipline needed from an office working environment to a work from home environment is a lot more extreme than many imagine, just be prepared.
2 Start up costs
As exciting as starting up your own business is, do you really need a company car, a board room desk and executive toys? I think it’s a millennium generation thing where they were brought up with everything ready, and they never felt the joy and satisfaction us baby boomers felt waiting and saving up for what seemed like an eternity for something we needed. It is a sad day when you have to sell everything you paid a lot for at one fifth of what you paid for it because you are struggling to pay for your top of the range company van, desk, and new Apple PC and printer you hardly ever used.
Don’t go into debt until the business can afford to pay for it but any amount of cash on Branding is a great idea!
3 Their product /service
If you are not breaking out on your own with the skill you developed in your previous working environment, then you need to have something fantastic that will work for you.
This is the one area where most people fail, as in what you are going to provide to the online community that is so different and desirable that will sustain you in business for years to come?
Have you ‘really’ done your research, or are you so desperate to get away from the 9-5 that anything will be better? It may be heaven sent for the first few months until the banks and your regular bills are not quite as understanding as your partner at home is!
As an online branding guy if I was suddenly thrown back out into the job market again, the most important thing to me would be how good a company’s brand is, as in what is the general feeling everyone has about the product or service offered by a particular brand, then I would push to work for the company with the best brand image and most established company.
Is what you are selling well respected and established or at the very least what research have you done to see how well your new product or service will sell?
4 A Regular cash flow
If you are working at home in your own business, where is the cash going to come from? And equally important; is how long does it take to get to you? Have you considered how people will pay you and fees people like PayPal, Money bookers, and even banks will charge that will skim off your bottom line.
Crypto currencies are offering ways for stay at home workers to get paid instantly and with miniscule charges if any, anyone working from home will be seriously watching the block chain and bit coin markets to see how to save a lot of money in profits, especially if your business is global.
More people than I can count have failed at the money stage, they had a great business but waiting and getting the cash was the killer. Amway for example offers weekly pay direct into a bank especially in Europe which is a massive shift in the way consumable business is done.
You also need to consider the delivery charges how much to deliver products if you are selling consumables, and getting you to their work places if it is a service you are selling.
If you sell medium priced products, have you thought about credit and payment terms, I’d suggest looking up how many business in UK owe other business lots of money, and how credit firms are making a lot of money trying to get money owed to these business, and also do your research into the appalling percentage of start-ups that die in the first couple of years because they are owed so much and can’t survive with no cash flow, and the related stress this will cause you.
If you don’t have the cash flow to hand as liquid, then your business is going to grind to a halt and the upshot of that would be a very painful day back at the office starting again as the post boy!
5 Repeat business
Forgive me for being so blunt, but you are going to have to learn to sell and ask for money, as well as learn many other tasks you may have taken for granted in your office for many years, like sales and not being afraid to ask for what you are worth. The best sales people are in the consumable business as they know it is repeat business again and again. If what you sell is a one off, then you are going to be using half your time looking for new clients instead of building a pipeline.
Insurance sales people are always happy at least once a year when they get their annual premiums bonus just for looking after the clients they already have, and guess what? most of their new clients come from their existing clients! I learned about residual income or passive income many years ago, and it has stood with me many years.
Residual Income means to find a business that you manage with your valuable time whilst you are young enough, then later the business looks after you.
For example a business of buying and refurbishing property will eventually mean you have a portfolio of properties that will yield you a rental income even if you stopped working.
MLM companies sell financial freedom to their distributors; as in develop a team that bring enough turnover of consumables that grows in time after you have pushed it to the critical mass level.
One thing I was recently impressed with was when I looked again at the UK Amway business opportunity was the retail commission of 25%. As a sales person for blue chip and public companies in UK I never got more than 10% in anything I sold and I was only ever as good as the last month, and each new sales month the slate was wiped clean again.
If you for example as an Amway distributor found 20 clients who buy £100 a month direct from your online shop each month meaning a £2,000 a month turnover every month, with bonuses, that equals a £14,000 a year job after taxes that pays if you turn up or not. That is without recruiting a single person, and the products are delivered direct to the consumer and payments are done between manufacturer and consumer, so no logistics headaches either!
So make sure you find a business where your customers keep coming back, and better still if they come back to you with their friends!
To find out more how to get a supplementary income by working at home, I know and have tried many things, I may just have the thing for you; contact me by using the contact form at the top of this site.
To your success
Living and working at home for leads4biz since 2003