Fake it Till You Make it

June 29, 2010 by 2 Comments

As a new business owner, one of the biggest problems that you’ll face is proving to new clients that you have the experience as a business to meet their needs. It’s just human nature. Everyone is careful with their money and they would rather go with a company that has a proven track record and not someone doing the work “on the side.” In some ways, it becomes a Catch-22. You can’t get clients until you have experience, and you can’t get experience until you get clients. As a new business, we faced similar problems and had some tough times getting clients for a while. We learned some “tricks” to make our business look bigger than it actually was – how to “fake it till you make it”, to borrow the saying

How to Make Your Business Look Bigger than it Really is

  1. Give Away Your Service for “Free” – This is a common piece of advice that you’ll see and something that I don’t really like, so we put a little spin on it. You don’t want to attract people who are just looking for a deal. It’s the wrong kind of client who will take advantage of you and never be happy with the service that you provide. However, it’s still a good way to get the credentials you need to refer to when selling your product or service to other businesses. What we did is give away our products to our clients at our “expense”. Usually, there was some sort of “Cost of Goods Sold” that we incurred and we told them up front about this. They were willing to pay this token amount because they knew it was still a great deal, and we got some money, and the test clients that we wanted. In fact, we often used these clients to test our product (again, we disclosed this too) so it was actually just part of product development.
  2. Hire a Receptionist – This is one of my favorite tricks that we used. By having someone answer all your incoming calls, your business suddenly gains a huge amount of credibility. Once businesses can support someone to answer the phones, most people will think that it’s successful. So what we did was hire someone at Kshs 10,000 per month to answer any incoming calls that we got. She would answer the calls and just e-mail us the messages or call us back if it was urgent. It didn’t take too much time for her and it was cheap enough for us. We just provided her with a mobile phone.
  3. Outsource your Work – One of the more subtle ways to look bigger than you actually are is to outsource your work and then refer to them when talking to clients. If a client is asking you to complete some work and you say “I’ll have to check with my designer to see when I can get that to you”, it sounds a lot better than, “I’m really swamped this week – I’ll try to get to it when I can”. You also can say that you have several people working in your business. Probably a little too much in the gray area, but if you’re asked point-blank and saying you’re a one-person shop won’t work, it’ll do. Even if you tell clients you outsource most of the work, it’s usually ok, because it sounds like you’re a growing business.
  4. Work with Partners – Besides coming with a stable full of qualified clients, one of the reasons that we wanted to work with partners when selling our products was that it afforded us the chance to build up our client list on our partners’ back. While we can’t refer to these clients directly when talking to prospects (or we just say that we have them through a partner agreement), we can still cite experience that we have working with clients.

Lying directly to your prospects isn’t a good idea because they’ll figure you out eventually. But if you can fake it till you make it by using the tips outlined above, you will find that it becomes much easier to attract new clients as prospects know that you are a successful business with a good track record.

How else can you fake it?

Filed Under: Small Business

Outsource Everything

June 17, 2010 by Leave a Comment

Outsource everythingOne of the things I am a huge fan of is that every Business Owner should outsource everything that they possibly can. I know I’m not breaking any ground with this idea (if you want to read a great book on the power of outsourcing, I strongly recommend Thomas Friedman’s, The World is Flat) but what I am advocating is pushing this idea to the max. I look at everything I have to do to see whether it’s something I can just outsource it so that I can free up even more of my time.

One of the first really big projects that we received was for a web application in which we were paid a HUGE amount (our largest project for us at the time). This was a project that we scoped out as taking at least 3 months of our full attention. This is back when we were just testing the entrepreneurial waters and had other full-time jobs. All of our spare efforts were focused on this first product delivery, and we delivered as planned by focusing our efforts on it fully.

That project led to another one that was 3 times as big as the initial project and took us another 6 months to complete. Now it wasn’t for 3 times the dollar amount because of a partial equity deal we were involved in. The problem was that when it was all said and done, we had put in about 9 months, and all we really had to show for it was 1 client, 1 project, and nothing else for our business from the previous 9 months.

We don’t regret that period of time. We had a lot of flexibility because of our situation, we learned a lot, and we spring-boarded from that to working on the business full-time, but there was an important lesson learned there.

I Should Have Outsourced Everything that Didn’t Need Us.

The development of the application that we spent all of our time and effort on should have been outsourced to a development company that could have completed the effort based on the requirements that we had already created. We would have made a lot less profit from those efforts but we could have spent that time (which was A LOT of hours) on developing new business, creating new products, or just being lazy!

The important distinction are those efforts for which we are required and those for which we are not. New product/service development and most marketing efforts require our involvement because it’s very tough to outsource something when it’s not even defined yet. But for something that is relatively basic like web application development, we should have outsourced the efforts.

What Else Should I Outsource?
Honestly, if it is something that would take more effort for me to write up the instructions for someone else to do, then I’ll usually do it myself. Otherwise, I delegate it off to someone else. These are just a few things that we did ourselves until just a few times when we realized that it’s much more efficient to hire someone else to do it:

  1. HTML Updates for existing websites
  2. Contact Generation for Marketing efforts
  3. Direct Mail Generation for Marketing efforts
  4. Service Delivery fulfillment for direct mail pieces in our online marketing system
  5. Follow-up calls to existing leads
  6. Sales Lead generation and adding new leads to our contact list
  7. Web Application development

The Financial Mathematics of Outsourcing
The finance behind outsourcing is pretty obvious and has been discussed many times over so I won’t spend much time on it. Simply put, if you can get someone to do something for Ksh 10,000/- and your time is worth more than that Ksh 10,000/-, it is simply an efficient form of resource allocation. Or to put it another way, it might cost you Ksh 5,000/- to outsource a very menial task to someone and during the time that you might have done that yourself, you could create a new marketing campaign that generates Kshs 50,000/- in new business.

You don’t even have to do anything else during that time. If you would just like to spend less time working in your business, the Kshs 5,000/- might be a small cost for the additional free time that you generate.

You Don’t Necessarily Need Offshore Outsourcing
A lot of people automatically associate (and confuse) “outsourcing” with “[offshoring]”. Offshoring is just one way to outsource your work. You can also outsource it to onshore companies. By far, the majority of our outsourcing work goes to local resources. It’s just been easier for us in most cases to pay a little extra money and get someone we can communicate with easily.

Regardless of where you find people or companies to outsource your work to, you need to start outsourcing everything so that you can continually focus your efforts on building your business.

Photo courtesy of MarkHillary.

Filed Under: Small Business Tagged With:

Making Money Online

June 16, 2010 by 3 Comments

Written by guest contributor Jennifer Gorton from Forex Indicators.

If you haven’t thought of putting some of your paycheck into a savings account, there is no better time to start then now. Having a savings account will provide a cache of money that is stored away in case of emergencies. The money can also be used down the road as a down payment for your dream home or renovations of your current home. At the moment, the interest rates banks are offering are so low that the return you are getting by keeping your money in a savings account is minimal. Even though the return is minimal, your savings will slowly build up over time to a significant sum.

Interest rates that everyone is receiving right now might be just too low to justify keeping your money in a savings account. If you feel this way, there are other options available: there are stock brokers that will allow you to buy and sell stock online, charging little in commission. Some banks even offer their brokerage services that will allow you to make commission free trades up to a certain limit. This is a nice service to have as many investors that do not actively trade enough to warrant opening up another account with a different broker.

Having your checking, savings, and brokerage account all with one company makes transferring funds between your accounts easier. You can still keep some of your money in the savings account while adding small amounts to the brokerage account to buy stock. Buying stocks with higher dividend yields than the current savings interest rate might also appeal to you as an investor. With your money earning more, there might be an added incentive to add more of your paycheck to the brokerage account.

Opening up a foreign exchange account is another alternative to a savings account or buying stock. The foreign currency market, or Forex market as it is referred to, is the largest market available to invest or trade. With over four billion dollars changing hands each day, the currency market is a viable alternative that could produce a higher yield. If you are looking to trade to currency markets, be warned it is not as easy as letting your money sit in a savings account. The price of currencies will move quite substantially throughout the trading day and night. The Forex market is open 24 hours a day 5 days a week, so it is possible to trade or make longer term investments at a time convenient to you. The big swings in price could cause the average investor anxiety as your position might be profitable one moment and showing a loss next.

The big swings, however, are the reason that big profits can be made investing in currencies. All Forex brokers will introduce you to the latest strategies and ideas through training videos. The online retail currency brokers have these videos on their web pages for new investors to watch and learn from. These videos will tell the investor what the best Forex indicators are, and when and how to appropriately use them. There are many indicators out there that will help to predict the future price of the currency. If you utilize this, then these big swings in the price won’t give you as much anxiety because you will be able to understand at what time to close out your positions.

Currency positions can also be used by the more sophisticated investors as a hedge for another open position. Say the investor has bought shares of a company that is paying a high dividend, wants to hold the company for a few years, and then collect the quarterly payments for income. If the company is based in the United States and the market starts to go south, the stock has the potential to lose value.

The investor still wants to hold the stock for the dividend, but would like to make sure that the loss in share price is offset by a gain in another asset. If the U.S. market is going lower because of economic issues, he can then take a short position in the U.S. Dollar. If the U.S. economy weakens and the market continues to go down, the investor will profit from being short the currency of the country. He can then continue to collect his dividend payment without feeling as though his stock position is costing him in the long run. All reputable online brokers have investment advisors that are more than happy to talk to you about investment ideas. Make sure you talk to them so you can be confident that your investment decisions will make you money.

Filed Under: Make Money Tagged With: ,

Why Most People Go Wrong In Forex Trading!!!

June 11, 2010 by 5 Comments

I’m going to show you the 5 myths about Forex trading and why they are all wrong. Believing in a fake myth is a huge danger. Lots of traders learned this on the worst possible way…

When you finish reading this small report, you’ll be one step ahead them.

Myth number 1 – If I know how to trade stocks, I know how to make money in Forex:
If you have experience trading stocks and think you can simply apply your knowledge in Forex and make money, you’re going to be disappointed. The Forex market is much more complex. Firstly, the Forex market is open 24 hours a day. This may not seem a big deal but it’s a significant difference in relation to the stock market. As the Forex market is open 24 hours a day, this brings more complexity to a trader. If in the stock market you have periods of higher and lower volatility, in the Forex these differences are even higher.

Many stock traders think the Forex market is easy because it is open 24 hours a day. They think they can trade whenever they want and make their quick bucks. Truth is you can make money in Forex. But for that, you need to have a deep knowledge about this market. You have to know the best time to trade Forex in order to adjust your strategy to this market.

Besides this, the indicators that work in stocks don’t always work in Forex. The Forex market is more complex and, this way, the indicators that you use on stocks don’t work so well here.

Brokers are another huge difference between stocks and Forex. In the Forex market, due to the lack of regulation, a lot of Forex brokers don’t act in their clients’ best interest. It’s a lot more difficult to find a good Forex broker than a stock broker.

Later on this Free mini course I will tell you how to avoid Forex Brokers Scams.

Myth number 2 – Since the market is open 24 hours a day, you can make Money anytime you want:
Once again, this is not true. In order to make money, a trader needs volatility. Although this market is open 24 hours a day, in the majority of the time there isn’t enough volatility to make good trades. This is a big challenge because volatility can appear at any time of the day and the trader can’t be watching the market all the time. He has to adjust his strategy in order to trade only in high volatility periods.

Myth number 3 – There are no trading fees in Forex:
You don’t pay a commission fee when you place an order. Although, you pay the spread, which is the difference between the bid and the ask.

This way, the more you trade, the harder it will be to make money in Forex because you’ll have higher fees. In the Forex market, as in any other market, a trader must avoid the overtrading at all costs.

Myth number 4 – You need to predict what will happen to make money in Forex:
In order to make money in Forex, you need to react to what is happening. This is not the same thing as predict. A good trader simply reacts to whatever the market is telling him. He analyses charts, reads the news and all information he has at his disposal in order to react as fast as possible to market movements.

Myth number 5 – The more complicated my strategy, the best:
This is another myth that has nothing to do with reality on Forex trading. The truth is that usually the simple strategies or systems outperform the complicated ones.

This article was written by Moses, an online forex trading expert. If you would like to learn more about online forex trading, please contact Moses.

Filed Under: Make Money Tagged With:

3 Hot Tips For Online Forex Traders

June 8, 2010 by 2 Comments

If you’re just starting trading Forex, there are a few tips that can save you time, work and money.

The first tip is extremely simple:

1. Trade just a single currency pair – Most professionals trade just one or 2 currency pairs at most. However, most beginners tend to try to trade all the currency pairs. If you’re just starting trading Forex, it’s a good idea to trade for example the EUR/USD. Don’t trade anything else unless you already have lots of experience with this currency pair and feel you can start trading 2 currency pairs.

2. Trade the larger time-frames – Other common mistake in Forex is that traders try to make a quick buck. This way they tend to trade intraday charts in order to capture fast profits. This is a mistake. No matter what strategy or system you’re using, there’s a good probability that it will work much better on larger time frames. If you decide to start trading using, for example, a 4 hours chart, you’re way ahead of traders that try to trade on a 5 minute chart. The truth is that in the intraday charts there’s much noise, and since you can’t trade 24 hours a day, you end up losing some of the best movements. If you’re trading larger time frames, you’ll trade with less stress and you’ll be able to capture bigger trends. With these 2 advantages, it will be easier to start making money in Forex.

3. You need to use good risk management rules – Don’t start using too much leverage, because if you do so, a single mistake can make you lose your entire account. If you start by risking no more than 2% or 5% of your account on a single trade, you’re protecting your account in case something goes wrong. This is one of the best tips you can follow in Forex. Most traders lose money because they use too much margin. They end up losing all their account before they even learn how to trade Forex successfully.

If you follow these simple 3 tips, you’ll be on the right track to trade Forex successfully. These rules are simple but highly successful.

If you would like to learn more about online forex trading, please contact Moses.

Filed Under: Make Money Tagged With:

How To Increase Revenue By Decreasing Effort

June 3, 2010 by Leave a Comment

Work?When Sergey Brin and Larry Page founded Google, they created the original search engine based on a research project that they did at Stanford. Once they thought they had a real idea to work with, they rented out the garage of a house to begin their business and to continue working on their search engine. This was all occurring around 1997 and 1998. Google didn’t start making any money until almost 5 years later. However, the Google co-founders spent most of that time working on their business and not programming their search engine.

The lesson with their story is that they realized that they couldn’t continue building their product – they needed to build their business, even if there was no revenue coming in (there were investors to provide them with cash to survive on). If they continued to work IN the business instead of ON the business, the company would not have been the success it is today.

I’m not sure what specific actions they took to build the business but they had to implement systems and processes so that other people could work in the business (building and improving the search engine) while they could grow the business (getting financing, hiring people, creating systems to generate revenue).

As a small business owner, the only way you can have a truly successful business is by stepping outside of your everyday activities and create a self-sufficient business. It might seem like it will cost you more money but in the end, it is the only way to drastically increase your revenues while decreasing the effort you put into the business:

1. Create a Manual
No matter what task you are doing for your business, write down the steps you take in a manual. It might seem like more work without any direct benefit but this step is probably the most important thing you can do for your new business. The next time you do the activity, it makes it that much easier because you just have to follow the steps that you wrote down. It also makes it easy to hand it off to someone else to do in the future.

2. Outsource as much work as Possible
This doesn’t mean that you have to ship your entire business to India. It just means that you have to find someone to do a lot of the tasks that you do yourself. It could be something as simple as distributing marketing materials, doing weekly bookkeeping activities, or providing support to existing customers. It’s very easy to hire a virtual assistant to get stuff done for you.

If you completed Step #1, you just have to hand it over to someone else to complete. It might seem like a waste to pay someone Kshs 5,000/- to do something that is so easy for you to do but imagine if you can spend that saved time on 1 thing that will increase your revenue by Kshs 20,000? You increase your revenues and there is less work that you have to do.

3. Define a Sales Process
If you don’t have a defined sales process and just wing it with every new lead or visitor to your web site or place of business, you are missing out on a significant amount of business. You are reinventing the wheel each time you get a new prospect so you are spending too much effort on that initial sales effort.

It also means that you are not perfecting your sales process so that you can increase the effectiveness of your sales process. By finding a system that works, you can constantly apply that and make changes to increase the effectiveness of it. It also minimizes the human element so that you are not as reliant on a superstar sales person (whether it’s you or someone else). By having a sales process in place, you will increase your conversions and increase your revenues without any additional work on your end. You are just replicating what has already worked.

4. Automate Your Sales and Operational Processes
This draws on much of the first 3 steps. Once you have created a manual and have systems that are beginning to work, you need to work on automating processes as much as possible. If you’re automating your sales process, maybe you send the same basic e-mail to potential leads through an e-mail auto-responder. If you call to set sales appointments with leads, maybe you can hire someone to do that part of the process for you.

As far as automating your operational processes, software is often the best way to do this. See if you can purchase a product that will automate part of your process. It might even be worth it to hire a developer to build a program to help you automate part of your set-up or service delivery process.

5. Act on Regular Tasks Less Frequently
Start setting aside time each day, or week, or month for specific processes. I used to get in the bad habit of working on accounting tasks every day. Not that it’s so bad to stay on top of that stuff, but by focusing my attention on it once per week instead of each day, saved me a tremendous amount of time. I love checking on the status of some of my marketing efforts but I must force myself to wait until my regular time each week so that I’m not repeating the same thing every day.

Increase Your Revenues and Decrease Your Efforts
Creating a new business requires a tremendous amount of upfront time and effort. Successfully growing your business means creating systems and processes so that other people can work in the business while you grow it by working on the business. This is the only way that you can significantly increase the revenue in your business while decreasing your effort. In fact, it’s the only way to really build a business. Otherwise, you’re basically just a one employee company and you will never get much bigger than that.

Photo courtesy of eneas.

Filed Under: Make Money, Small Business Tagged With:

Why It’s Better to Make Money “Offline” than “Online”

May 31, 2010 by 1 Comment

There’s a lot of friends and fellow Kenyans who are looking to make money online. Is it possible? YES! But you need to get into it knowing full well what you’re going in for. Hence this article.

There are ton of great websites, blogs, and programs out in the Internet about how to “Make Money Online“. Many of them have great ideas, and I read some of the better ones on a regular basis. While there are many different variations on this, there are basically 3 different ways to make money online:

  1. Content Sites – Having good content and a lot of visitors and then selling advertising on the site. This is the reason for 90% of the blogs out there (my own guess)
  2. Affiliate Sites – Sites set up specifically to refer visitors to purchase products sold by other people/companies, in which the referrer gets a percentage of the sale.
  3. eCommerce Sites – Sells niche products and often through drop-shipping. This way, the operators don’t have to handle any inventory.

If it Looks Too Easy, It Probably Is
The problem with these methods isn’t that they are bad ideas. The early adopters for most of these methods made (and continue to make) a decent amount of money because they were there first. The problem is that they are TOO easy to implement and get started. In economic terms, the barriers to entry are extremely low, and there becomes a flood of “entrepreneurs” who are looking for a quick buck.

When looking at new ideas or tools, one of the first things I take notice of is how easy it is to implement. If anyone can do it in almost no time, then it’s not worth doing. For example, there are tools that allow you to create niche websites based on a list of keywords that you have. It can literally create thousands of sites/landing pages for you. The problem with a tool like this is that if you can easily use it and implement it, then so can thousands of other people – thereby eroding any possible value in the tool. (Not to mention the fact that this “spamming” will quickly be a “no-no” in the eyes of Google and if it’s not already detected and blacklisted, it soon will be).

Defensible Position
The problem with tools like I just described is that you have almost no “defensible position”. What I mean by defensible position is something that others cannot easily copy. If someone else can easily (and cheaply) buy the tool I described above, you have virtually no defensible position. Google or Amazon are examples of companies with extremely strong defensible positions. While they compete against the likes of Yahoo and Buy.com respectively, it would be next to impossible for all but a few people in the world to create something to compete against them. And to do that would require an incredible amount of resources of time.

The Advantages of the “Offline” World
When I refer to the “Offline” world, I use the term pretty loosely. I’m really referring to any type of company that isn’t making money via the “Online” methods I listed above. Often times, these are more traditional companies with more traditional structures. For example, Salesforce.com is totally web-based but I consider that an “offline” company and the same goes for small software companies that sell some sort of product or service on the web. Or you could just sell something old economy – like paper.

1. You Have a Defensible Position – Usually this is some sort of product or service that someone cannot create by spending 3 hours on a Saturday to set-up. This doesn’t mean that there are no competitors but it also means that hundreds of people can’t start up a web-site just to test the waters.
2. You Have Real Clients – With online marketing, you do have “clients” but they are very fluid. You can use methods to get them to your site quickly and easily but there is no strong relationship formed there. Real Clients are those who chose your product or service for a reason and you have established your “brand” with them. They may recommend you to other customers or hopefully are repeat customers.
3. You Aren’t at the Mercy of Others – Every business should have an exit plan. That exit plan might be to use the business as a cash generator for years or to sell it once it reaches a certain income level. If the business is at the mercy of suppliers, which is really the case of all the ways to Make Money “Online”, whether it’s supplier of the products you sell or the supplier of the traffic and ads for your content site, then any future is very uncertain. But if you have a regular business that cannot be easily disrupted, it is much more valuable and more likely to be viable in the future. It is a much more valuable business.
4. You Can Make More Money – This one can vary a bit based on what you’re trying to sell. I know a lot of Internet Marketers who make a ton of money selling products and services offline and probably more than if they sold it as an offline product. The reason I say this one is that an online world, the easy of entry invites more participants, and with more participants, it in essence becomes a commodity product, and with a commodity product, it just becomes a race to the bottom (look at web hosting since that is so easy to become a reseller).

Will I Still Continue to Make Money Online…. Of Course!
Our main business and main ‘strategy’ of making money online in Kenya is to use the internet to drive up sales…in the offline world. This article describes it somewhat. It is sort of an online-offline hybrid of a business and we are always continuing to make it more “online” because we believe that if you can build an online business with a real defensible position, you’ve hit the jackpot!

But will I base my livelihood around a single content site or some affiliate Adwords arbitrage site? Of course not. Not because I don’t think there is any potential value in there. But because I know there are thousands of people out there who can easily come up with a better mouse-trap with very little time and effort and erode any possible value there for me.

I would rather spend most of my time focusing on the things that will create the most value for me in the long run. Those are the things in which I can gain a strong “defensible position” and more often than not, they are “offline” and not “online”.

How about you? I love feedback!

Filed Under: Make Money, Small Business Tagged With: ,