So everyone tells you that the only way to get ahead in business is to advertise. Well, that's true, but you need to make sure that you stick to inexpensive advertising methods when you're starting out. Spending hundreds of dollars for an ad in the local newspaper might turn out to get you very few new customers, and you will have spent your entire advertising budget on it.
Make your money go further with leaflets, direct mail or email -- these are easily targetable campaign methods with high response rates and low costs. Remember that it is always better to spend money on an offer than on an ad, and always better to spend money on an ad than on a delivery method.
Being Too Nice
When you're running your own business, it can be tempting to be everyone's friend, giving discounts at the drop of a hat and making sure that you don't hassle or inconvenience anyone. That's all well and good, until you find that your Good Samaritan act has just halved your profit margin without lowering the cost to the customer by very much at all.
Sometimes, you need to realise that you've got to be harsh to make a profit. Give people discounts to encourage them to buy or to come back, not because you like them or feel sorry for them. Don't be afraid to be ruthless in your pursuit of home business success. Nice guys don't finish last, but they are running in a different race -- one with much less prize money. If that doesn't bother you, of course, then feel free to go for it.
Not Using the Phone
You'd be surprised just how common phone fears are -- if you're scared of the phone, you're not alone by any means. Many people are terrified of making phone calls, and avoid them wherever possible. I have seen more than one home business owner reduced to tears on the phone and trying desperately to hide it from the customer.
You need to try your best to overcome your fears, as talking to customers on the phone is almost as good as meeting them for real. Letters and emails are useless by comparison. The best way to overcome phone fears varies from person to person, but it can often be as simple as making the phone fun, by calling friends and relatives often for a while and getting used to it. Alternatively, try working in telemarketing for a while -- if that doesn't make normal phone use look like a walk in the park by comparison, then nothing will.
Hiring Professionals for Everything
It can be tempting to think that, since you're starting out, you should just find a company or person to do every little thing you need. People seem to especially overspend on design services.
You might think it'd be great to have fancy graphics all over your website, but would it really increase sales? If I saw it, it would put me right off. Likewise, a slick brochure often fails to say anything more than 'I'm going to charge you a premium to pay for my expensive brochures'. Don't hire someone unless you can demonstrate that the service they're going to provide will increase your profits by more than the amount you're spending -- if you're not sure, try it yourself first, and you can always upgrade it later.
Reviewing Your Performance
So you've made it through your first year. When you quit your job, you probably thought you'd escaped performance reviews for good, but I've got some bad news for you. It's actually a really good idea to review your performance at your own company, to take a look back and see what you did wrong and what you did right.
Did You Make a Profit or a Loss?
The first, and most important, question to answer is this: what does your balance sheet look like? You need to honestly add up all the numbers -- don't be tempted to add on money that you think you're a few days from getting, or take away bad purchases that proved useful in your personal life, for example. Hopefully you kept electronic records, so this shouldn't be too much trouble.
Once you know how you did, you need to look at how to do better. If you made a loss (as almost everyone does in their first year), what can you do about it? Where did the money go? If you made a profit then, well, congratulations! But you still need to think about how much of your profit to re-invest in the business, and how you can increase