You have been noodling on going into your own business for a while and now you think you’ve figured out an idea on what you want to do. You’ve worked on your finances and you’re ready to make the plunge. However, there remains one nagging question in your mind . . . should I start slow with part time, take the time to grow my business or this is my insecurity speaking? I would say, in my opinion, you are just being cautious. There are many baby boomers out there who got started part-time and then went on to develop successful full-time businesses. Babyboomercashnow is a part-time business.
The good news is that everything I detail below can be done on a part-time basis. Let me say it a different way. You must verify your product/service on a part-time business to make sure your business is viable – will you actually make money from it?
Better to find out early on in your way to becoming an independent entrepreneur that the product/service doesn’t sell, while you still have your full-time job. And of course, you can tweak your product/service on a part-time basis until you get it right. It is a whole less stressful to make changes to your product or service without having to worry about having the money to pay your mortgage or your kids’ tuition!
Below I talk about how to get started on a part-time basis.
Patience
While you are really pumped to work as many hours as possible on your new endeavor, patience is the key.
First and foremost, keep in mind your current full time position is paying the bills. Working 40 hours a week on your new business is a recipe for disaster. You’ll be tired at your full-time job, your boss and colleagues will notice and your performance will suffer. You want to make the leap from a part-time business into a full-time business at your own time and choosing, not because you are forced into it by being let go from your full time job!
Determine How Much Time to Spend on the Business
Ten to fifteen hours a week will be plenty to start out for your new part-time business. This amount of time will enable you to concretely move forward in the business without losing sleep and still have time for balance between your full time work life and business life
Determine when you will work, which days and what time of day. I write my blog in the mornings on the train ride to work and research during the train ride home. This gives me 50 minutes each way to work on my business. One hundred minutes a day translates into 500 for the week or a little more than 8 hours. In addition I spend a couple hours on Saturday mornings. Over the last 19 months, I have averaged right at 10 hours a week on my part time business.
Others devote a large part of their weekends to their business because of work obligations during the week. Keep your part-time business work schedule flexible but dedicate time to it and track that time. No skipping work on your business for a week with a promise to yourself to work twice as many hours the following week. That just doesn’t work.
What do people Really Want?
Part of the early research is determining your target audience and what that target audience really wants.
It is often hard to tell what benefit people want. You can ask, but the answer you receive and the actions they take towards the goal, may not match.
There was a recent study that showed more than 50% of individuals who make New Year’s resolutions fail in keeping their New Year’s Resolutions in January.
Why do I bring this up? If you asked the individuals what they planned to do for New Year’s resolutions they would produce a smile and say, for example, “lose weight”. In fact, 41% would say that was their goal according to the study. But if half of the 41% will give up by January 31st, it really wasn’t a goal, it was a wish.
People often associate losing weight with pain, after all they are missing out on the comfort, the short-term good feelings that high carbohydrate foods provide. There is a reason why the first letters of diet spell “die”.
We often tell people idealistic goals so we feel better about ourselves. However, they really aren’t goals because there is no plan and only token action toward the goal. According to the same study, “many people start out with the best intentions to get into better shape by joining a gym, 67 percent of people with gym memberships never actually use them.” We all have good intentions, but we don’t always follow through on them.
A similar situation happens when we approach our friend about buying a product or service from us in the future. When asked, friends often “agree” or “promise” to buy your product or service – how often do we “sure, I’m happy to help when you are ready, just let me know”. We might even had said it ourselves to others. However, when it comes time to actually buying it, these same friends may be reluctant to come up with the money and that is when you start hearing the myriad reasons “why not”.
They tell us yes because they don’t want to hurt our feelings. At the time they say yes they may even believe they will buy the product/service.
Make sure what you are providing is something they truly want. As Chris Guillebeau says in his book The $100 Startup, “Focus on the core benefit of your product and make sure it is something that a potential customer truly desires”.
Don’t know what Benefit to provide? Ask
How do you know what your target audience really want? To determine what it often will takes some digging. This isn’t Internet research that you can do in an afternoon. This is feet pounding the pavement type of research.
Reach out to people in your target market such as friends. If this doesn’t provide a sufficient pool, look to Facebook and LinkedIn for additional target audience. Tell them you are looking to start a business and describe the type of business. Tell them you have nothing to sell, but you are looking to understand pain points in their business. Offer to take them to lunch, frankly insist upon it. Send potential questions ahead of time, but tell them the questions are only food for thought, no need for them to fill out a questionnaire.
Over lunch ask the questions and write down the answers. If you don’t understand something, ask them to clarify. People like when you are taking the time to accurately capture what they are saying and you want to make sure you captured the details.
Find 10 different people with whom to have lunch or coffee. Consolidate the answers to your questions and find the common issues in their responses. If it is not clear the most important and frequent issues, then interview 10 more people. Consolidate those answers and find the common issues. Keep doing this until you can determine the desired benefit. There is no shortcuts. Take the time to do this right.
Finding the core benefit will be at the root of what you provide to customers.
Ask for the Money
At this point you have determined the benefit your business will provide and you have a good idea of what the product or service would entail.
Your next step is to presell the idea. Above I mentioned that a friend may tell you they would buy, but the reality may be different case. Now is the time to find out. Before you commit to making the product.
For example, if you have helped plan weddings over the last several years and people look to you as the expert in planning weddings, this is may be a business for you.
Put together a detailed outline of what wedding planning guide would contain and go talk to a friend that will be planning a wedding soon.
Go through the outline in detail, and tell them the guide is $10 and that you are taking orders for the guide.
It is important to get the money upfront because you want to verify your audience sees the value in what you will provide and that they are willing to pay for it. Let’s be frank, if you’re not being paid, it is a hobby, not a business.
There will be people that will readily give you the $10 and others (friends) that may recoil when you ask them for the money and can’t believe you asked it.
They may say, “Its only $10, why don’t I just pay you when you put it together?” That makes sense from their perspective, because it is only $10, what’s the big deal?
But you are planning to spend many hours putting together a guide and this guide is the culmination of what you have learned over many years. Your time and experience is worth something.
After you have spent many hours putting it together and you hand them a copy, they may take a quick look at it, mutter that they already found the material they needed and hand it back to you, or they will say thanks for the guide, mentioning they don’t have $10 dollars with them and promise to pay you the next time they see you.
They never intended to pay you. They thought because of the friendship the product should be for free.
It was only $10, you may think there is no need to ask for it upfront. Why take the chance of ruining a relationship for that amount of money?
But, what if instead of creating a wedding planning guide, your business was restoring old cars. A friend of yours sees the cars you have restored for yourself and really likes the work you do. They have a car that was given to them when their father passed away. The car has been sitting in the driveway for several years and they would like you to restore it
Would you take on the job without any upfront money?
No, at the very least you need money for parts that could run hundreds of dollars or more, not to mention there should be upfront money for your time.
There is really no difference between the $10 dollar wedding planning guide and a car restoration business. In either case you ask for the monetary commitment up front so you know if they are serious in buying.
As a side note, the closer the friend, the more difficult it may be to get the cash up front. Don’t make exceptions. If they don’t want to pay, just move on. You are in a business.
How to find your Paying Customers
Start with who you know.
Make a list of 100 people and divide them into categories.
- Neighbors
- Parents of your children’s friends
- Business people you interact with (e.g. vendors)
- College friends
- Former colleagues
- People in your Facebook
- People in your LinkedIn
It is at this point that many entrepreneurs get cold feet. Many budding entrepreneurs just can’t get themselves to ask friends for money and will pass at putting together this list and actually contact those on the list. Daymond John, star of shark-tank says in his book The Power of Broke, “97% of the entrepreneurs who give up, become employed by the 3% who never quit.”
Most entrepreneurs would rather make a cold call; talk to a complete stranger, not knowing if the person has any need or desire for the product, rather than approach someone they know. They are afraid of the rejection, afraid they will lose a friendship if they ask. Two points on that:
- A true friend is willing to listen to what you have to offer because they are willing to help you. They are willing to say yes or no at the end of the presentation.
- If the person stops talking to you after the presentation; one where you made it clear that if the product is not for them, it is okay to say no, then they really weren’t a friend to begin with. It is not ending a friendship when you are not really friends to begin with.
You have to be willing to get out of your comfort zone and ask.
Treat the Friend the same as a Valued Customer
If you have a money back guarantee and the product doesn’t meet a friend’s needs, by all means refund the money. Do so with a smile and do not let the refund impact your relationship in any way. Friends may be reluctant to ask for a refund, but if you detect a change in the relationship; if their body language says there is a problem, bring it up to them. Find out the issue and refund the money, let them keep the product. It is much better to keep a good reputation among your friends and regain a few dollars.
Ask for Referrals
Anyone that has bought from you is a possible referral. Ask for two referrals from them. When you reach out to the two referrals let them know who referred you. If someone buys, get two referrals from them. Keep doing this, over and over again.
Your business is now off and running.
Action:
- Get clear on what your target market desires.
- Make sure the core benefit of your product/service is providing that desired benefit. If not, determine the benefit you currently provide and what it will take to provide the desired benefit. Make the necessary changes. Don’t go further with your business until you do this.
- Put together your list of 100 potential buyers.
- Put together an action plan to contact the 100 potential buyers.
Contact me at alan@babyboomercashnow.com and let me know the key benefit of your product/service. I’d love to hear from you.