You know, I never planned to start a business. At school, when I was daydreaming about my future career, it’s not an option that even occurred to me. But fast forward a couple of decades (yikes, how did that happen?!) and I now run two businesses.
I love it. The freedom to be your own boss, in charge of your own life and career… well, I can’t imagine any other option now. I even prefer the stresses that come with being self-employed to the stresses that come with being an employed pixel-monkey or shelf-stacker (I’ve done both and really don’t want to do either again!).
It hasn’t all been plain sailing though. Sometimes I wish I had given it more thought rather than just diving straight in. I could have done some research, planned things out more.
Over the years I’ve learned some big, important lessons. And I’ve also learned that sometimes it’s the little details that make a big difference.
So when people talk to me about starting their own business, I don’t necessarily start throwing out the big advice. You know, the ‘make sure you have 6 months of expenses saved up before you make the leap’ kind of advice. Because I didn’t do that myself and I did ok.
No, I’m much more likely to talk about smaller things that will make their life easier as a freelancer or business owner. Things that won’t occur to them because they’re already too busy planning out those 6 months worth of savings.
So if you’re thinking of starting your own business, here are 3 things I wish I knew before starting a business. It’s not major-life-changing stuff, but it will make your life much easier as you get used to being your own boss.
I wish I’d known that:
Having a business bank account keeps things simple
It should be obvious, but it’s not. People assume that they can’t afford the fees to run a business account. Or they can’t face the thought of having yet another bank account to keep track of and more bank statements to check through every month and file away safely. It sounds like way too much admin.
But actually keeping your business and personal finances separate gives you less admin.
Within just 2 months of opening my first business bank account I noticed such a difference. I wasn’t wading through piles of receipts and hunting through bank and credit card statements to find and record all my business-related transactions, crossing my fingers that I hadn’t missed any.
Instead, with a business bank account, I knew that every transaction on that account’s statement would be a business expense. And apart from the occasional expense made on my personal credit card, most months I just had one statement to check through.
So by separating out my personal and business finances, bookkeeping just became a lot faster. Over the years that’s saved me an incredible amount of time.
Plus by having separate accounts I can see at a glance the money that my business has to hand, and the money that I, personally, do.
If you haven’t set up your business bank account yet, get on it today. Remember to shop around and compare fees, plus many banks have an introductory free banking period so look out for those offers.
You might also like: Chasing unpaid invoices
Every project should include a charge for project management
Okay, maybe not every project, but anything that’s going to take you longer than, say, half an hour to work on is probably going to involve a chunk of admin. There will likely be several emails, maybe even phone calls or meetings, plus quote/s to write and all kinds of stuff like that before you even get to actually doing the work.
While each project management task doesn’t necessarily take up much time on its own, an email here or a phone consultation there soon adds up to a considerable amount of time on each project. And if you’re not charging for this stuff, you’re losing out.
The charge can be factored into your hourly or project rate, or it can be listed as a separate item on your invoice, whatever you feel comfortable with.
To figure out how much you should be charging you need to know how much time you’re spending on this stuff. So start tracking all your time. After a few projects you should get an idea of what you’re typically spending on project management.
That could look something like:
- Initial consultation: 15 minutes
- Writing a quote: 30 minutes to 2 hours
- Client onboarding: 30 minutes to 1 hour
- Progress update and check-in calls and meetings during the project: 1 – 2 hours
- And so on.
The amounts may vary depending on the size of the project and how much time a client needs from you – some clients will need extra chats and advice while others won’t need much at all.
So let’s imagine you’ve got all the data and can see that a typical project would take you around 30 hours of work, plus an average of 5 hours of project management. Your quote should definitely be for at least 35 hours, otherwise you’re losing a heck of a lot of time and money to dealing with admin.
This is a really simplified example, based on quoting by how much time you’ll spend working on a project. If you charge based on value instead, or a time/value hybrid model, you’ll still need to work out how much you need to charge for project management and factor that into your quote to make sure you’re getting paid for all the value and expertise you’re providing.
You might also like: Why you should use a project management app
It’s ok to ask clients for testimonials
I admit it, this is still something I struggle with from time to time. It feels weird asking clients for a testimonial for my website. Like I’m being cheeky and presumptive that they’d provide a glowing review.
But that’s just my pesky imposter syndrome rearing its head.
It’s totally ok to ask your clients for testimonials. In fact, it’s common practice.
I was in Tesco the other day and at the checkout was asked to give feedback on my experience. And pretty much every time I shop on Amazon or Etsy I get an email asking me to rate the purchase and seller.
It’s normal to ask for feedback. And that’s the thing. The important difference that my brain – and yours too, if you’re feeling equally uncomfortable – needs to adjust to:
Don’t ask for a testimonial. Ask for feedback.
The word testimonial has positive connotations, like you’re asking the client to tell you how wonderful you were.
While feedback is neutral; you’re asking “how did we do?”
Asking for feedback invites both positive and negative comments. The client is free to be honest about what they thought and felt about their experience.
Any criticisms can then be used to improve your skills, services and business practices – which can only be a good thing if it makes you better at what you do, right? And positive feedback can be used, with the client’s permission, for promotional purposes like a testimonial on your website so other people can see how awesome you are.
It’s all in the details
The journey of every business owner is filled with lessons, some big, some, like these ones small. And often it’s the small things that end up making a big difference, helping to make you happier, more productive and more profitable.
What advice do you wish you’d had when you started your business?
This post was first published on 5th July 2011 and updated on 28th May 2020.
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