I've started going to free business seminars from the library. The first one was called "7 Common Start Up Mistakes" that small business usually make. It was pretty interesting. The instructor specialized at one time in helping small companies through bankruptcy so he has seen a lot of failures.
His list of mistakes are:
- No Start up Budget
- Lack of Business viability.
- Underestimating the amount of money required for start up and running your business.
- No basic business plan is developed.
- No marketing, advertising or PR plan.
- Poor management.
- Not understanding the difference between profitability and cash flow.
I learned a new term for what's going on in my business. It's called Start Up Losses. The good news was that I have done some things right. I don't have a start up budget but I do have income from another source. I did make a number of purchases of things I need to work before I quit my job and I've adjusted my lifestyle to live on much less money than I was spending when I was still working for someone else full time. I did test my market a little before I made this my full time career by publishing a few patterns and seeing that they did sell. I did do research and spoke to other people in my industry. My interviews are an ongoing form of mentor-ship for me as I move forward with this. I'm also very sure that profits (if any) will be small. So I don't see this as a get rich quick scheme, more as an engaging way to spend my time. I'm planning to take another session on developing a business plan so I'll deal with Number 4 later. I doubt that I'll do anything really formal perhaps just some goal setting type plans. Marketing is low on my goals list right now as my main focus is pattern development. I am starting to pursue teaching opportunities and will spend more time on that in 2011. As for poor management I'm so new to this that I have very little to manage other than my time! Cash flow is also not an issue right now but I am thinking about products I might retail or wholesale in the future. I'm thinking about knitting notions or yarn but I think realistically that would be a few years off.
I have noticed with my interviews that planning seems to be very low on the priority list of my interviewees.That tells me that I'm thinking about this kind of thing a little more than the average but I think that falls into the category of the saying "that and 50 cents ($3.99 in today's economy) will get you a cup of coffee". I have also started a small pro-knitters group that meets once a month and it has been a wonderful source of information and support. It has made me realize how all of us are so very isolated in this industry.