It’s just dawned on me – The massive mistake made by every new business


And it all started because it dawned on me at a business meeting what an uphill struggle faces new businesses and I haven’t seen a new business ever get it right unless it was started by an old business.

What makes me such an expert?
I was lucky*, I started with cmx as an electronics designer, it was a company with 23 employees in a 6,000 sq. ft building. I swiftly moved up through Technical Director, Financial director and ended up where I am today. Managing director of an IT company with centres at Colchester, Ipswich and subs at Bury St Edmunds and Braintree.

I started with something large, existing and then I steered it to a totally different company, I have learned by my mistakes but I have learned much better lessons from other peoples mistakes. We have changed a lot in the 34 years we have existed.

So, I have never ever been a self-employed, one-man band, start-up from nothing. So what can I teach you? Well its what I have learned from decades of marketing and yes, its something that seems to be a total avoidance area for the new business for a number of reasons. Its also something that hit me only a fortnight ago.

The blinding inspirational flash.
I was sitting in a breakfast network meeting, I do six a fortnight, listening to a marketing person do their 40 second pitch and it suddenly dawned on me. I spend a lot of time on marketing my business, how the hell does a small start-up or new business do this? They cant, its impossible, how do they ever succeed? I can spot them in a network meeting, the new and likely to fail, nice guys they are enthusiastic and totally unprepared.

Its not arrogance on my behalf, its a simple fact, small business don’t market themselves. They think they do, but they don’t, they cant, but they should, or else they will be doing something else in a very short time indeed. Its a “why spend money on that question.”

Joe Smith redundant but good at what he did
Lets Look at Joe Smith, He was employed by Suffexshire County Council as an office manager and he was pretty gooCorporate employeed at it. In 2009 he was made redundant, he had his redundancy payment but with a few loans, mortgage, working wife and children he needed a job. He quickly found that he was in a large pool of people looking for work.

He decided that as his best skill was organising people he would take his skill and knowledge and become a consultant, the dream, working for your self, being your own boss, working from home, everyone needs a business advice, what could go wrong?

The leap into self employed heaven
He found an accountant and used his own bank. He joined the local chamber of commerce and Business and Corporationsa trade association. He had some business cards printed online by Vista print and some leaflets from a local printer. He organised everything with VAT & HMRC. He insured his car for business cover and found professional indemnity insurance. All before he did all this he dedicated his efforts to the most important thing, what he should call himself and he chose JSBC (thinking; HSBC – familiar and Joe Smith Business Consultant). Oh and he got a web site and e-mail from the cheapest he could find. He even came up with a buy two hours get one free offer and a free initial consultation. His hourly rate was £40. He joined a couple of networking organisations, one was fortnightly and nothing was compulsory and the other was a weekly referral organisation with strict rules

He was busy, right up to the end.
He spent £6,000 in his first year and £6,000 in his second, he picked up two clients because he was cheap, he was also busy, he visited a total of 20 prospective clients a year with the free offers but he only had 100 hours of paid work each year, about two hours a week. He earned £4000 and a bit morCorporate employeee in the second year. He didn’t cover his costs, let alone his fuel and getting a wage. He is now looking for a job, dream smashed.
Joe was his own worst enemy
He was good, knew his stuff, he did what he thought were the right things, what did he do wrong? Well it was simple. He did his own marketing. Effectively he thought he had planned but he hadn’t. Marketing is the secret to finding your prospects, targeting them, converting them to clients and then finding more on a continuous basis. Its a specialist task and you need a knack for it as well as knowledge and experience.

The thing I have learned in all the years I have been running a business is that marketing is vital. I spend three days a week marketing, I have several other guys here to help me do the actual IT work. Otherwise I couldn’t do it, but I still ask marketers for the occasional help.

A hiding to nothing.
A start-up doesn’t stand a cats chance in hell of success if they have no experience of actually running a small business and their accountant, usually the first business contact doesn’t have a clue about marketing either.

They don’t have the time, knowledge or experience to dedicate to marketing and if they did, they wouldn’t be able to do the work which leads to the feast-famine model. They are too busy to have ongoing business and then too much time for marketing.

What you need is a support network of fellow business people and someone to plan everything for you. Effectively Joe thought he had planned but he hadn’t. Marketing is the secret to finding your market, targeting it and then growing your business.

Unless you are lucky, like I was, you start with nothing
Remember when you start you don’t have a business, you have something you are good at. That wont pay the bills unless you have a marketing plan. Your first move should be to set enough money aside to pay for a marketing consultant.

They will help you plan and prepare, they will have all the business contacts you need to decide how you are going to get clients, who to use for websites, printers, accountants and then you will have a budget and a plan. When this is in place, now and only now, start trading and follow the plan.

Nothing succeeds like success
Business success will follow. Marketing consultants only exist from success, you will never find a successful one with a string of failures behind them. The good ones are at network meetings, being a presence and meeting people, they are following their own plan.

There are several I would recommend, talk to them, decide who is best for you and who has the experience you need. They all have slightly different areas of expertise. When you are earning enough then get a business coach for the next stage.

Who would I recommend?
Who would I recommend for a start-up or recently started-up? In Suffolk or Essex I would heartily recommend Alexandra De’Cort from Beckett Media, Sarah Eden of Tangible Marketing and Louise Stephens from Marketing Fox. These are all my favourites. How did I meet them? Over the years at networking groups, I have met them, gTwo workersot to know them, like them and I trust their knowledge and experience.

That’s how networking works so if you are new to business then talk to them, you will get to know, like and trust them and they will probably introduce you to the world of business networking too.

As an add-on we often have new businesses approach us about IT and we often advise using what they have or obtaining some of our refurbished equipment. What we often see is cheap or inappropriate equipment, which needs replacing in a couple of years, again talk to an expert first and ideally one who will have your interests at heart for the long term relationship and not one who is after the biggest commission cheque they can squeeze out of you.

cmx logo new 2015


* I am Glyn Cheeseman, MD of CMX Business Computing. The opinions I am expressing are by own based on my experience in business and talking to many business people over the years. I ran this article across several people I know before I published it. Apart from my professional qualifications I have attended many business courses over the years and I still attend training sessions where I can as I believe that you can really learn from others experience and knowledge. Although I usually spout about computer related things I occasionally feel there are points and subjects that need raising. follow me on @glyncheeseman and sign up for this blog.

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