11/05/2012   Leave a comment

I’ve been in business for 10+ years as a web professional, and I’ve made many mistakes but learned a lot too. Here are 19 mistakes I made and what I’ve done, and still doing, to reach my goals.

Not surrounding myself with like-minded, positive people

When you chose to start your own business, you’re going against the grain of life. Many of your nine-to-five friends and family don’t understand what you’re doing. What people don’t understand they often don’t respect. Sometimes people envy your freedom and what successes you might achieve and attempt to discourage you. People who are overly critical of your actions and doubt your success are people you must be on guard against. You have to identify these people early on and cut them off, or they will hinder your growth. The alternative is to connect to blogs, forums, local meetups and network events where positive, like-minded people are. They will encourage and help you grow.

Not learning the imperative of marketing sooner

Self-employment comes with two jobs, the work you love to do and the marketing you don’t (at least for me, I didn’t like marketing). Without marketing, you won’t have work, and your business won’t grow. The lack of marketing will have you working with bad clients and eventually placing you in a position where you can be taken advantage of.

I wish I knew about books like Guerrilla Marketing sooner or any one of the helpful articles on the web. The key to marketing is to try all the methods until you find what works best for you. I’m not just talking about what makes the most sells, but the one you really like doing. Believe me. There is at least one marketing tactic that you will like doing.

Not having a niche

I knew designing service-based business websites was what I wanted to do, but that was too broad, I didn’t have a niche. You need to find a segment of your general audience and then pursue them with services catered to their needs. It’s easier to make money when you’re targeting a smaller audience rather than casting a big net.

Not doing market research

You need to find out what motivates your niche group, what problems they have, what their income is and where they hang out at; and then learn some more about them. You can do this by subscribing to their blogs and going to their trade meetings. The more you know about your target client, the more confident you are at helping them, and the more likely they are to work with you because you’ve taken the time to understand them.

Not establishing a clear business identity

You have to know who you will be and what you will and won’t do for your client. This starts with your business’ image and its pricing; these communicate a lot. Make sure how you’re perceived is how you want to be seen.

You must determine if you will be a partner, or a subcontractor, or an employee, or a consultant; or a combination of these. If you’re a consultant, you have to act like one — you ought not to allow your client to dictate as if you were an employee.

You have to determine if you’re willing to work in their office, and if so, how many hours or days out of the week. If you’re a subcontractor, a client can easily treat you like an employee (with no benefits) so make sure you have boundaries in place. The same can apply to services. At the end of the day it’s all about asking yourself this question: do you know who you are? If you don’t have a business identity, your clients will give you one, and it’s usually not what you want to be.

Not looking at each client as a relationship

For me, a web project may take a month or more, and then there’s maintenance. When my client signs the contract, we’ve started a relationship. I didn’t use to think of it like that. So you have to begin to ask myself, “Do I want to be in a long-term relationship with this person/company?” This means you have to know what kind of people you like, set a standard, and judge your leads by that standard to determine if the relationship will work. This is called qualifying clients.

Not qualifying clients, financially or character wise

Good marketing is about finding people whose values align with yours. I often failed to qualify clients because I didn’t have an ideal client in mind, no niche market, no business identity and I wasn’t comfortable talking about money up front. Qualifying clients saves you time and energy. Before you go any further with your lead, you have to ask yourself two questions: 1) can they afford my services? and 2) are they a respectable person? All these questions can be answered by phone or in a face-to-face interview.

To qualify them financially, simply ask what their budget is, or tell them the average cost for your services. If they don’t fit your price range, then you can’t move forward. This prevents wasted time in consultation and writing a proposal that may be rejected. Getting budgets out the way isn’t being greedy, it’s just plain smart.

Finding out if the potential client respects you and your service is a little trickier. You have to listen closely and watch them. First, think back to any of the bad clients or relationships you were in and you may recall the red flags. It just boils down to paying attention to how they act, what they say or don’t say, and the way they treat you during the initial meeting.

Reassessing the relationship during each phase of the project and after completion is important too. Some clients start off great, but time reveals their true character. You have to determine what you’re willing to accept and not, and then make this a rule you won’t go against. Stay positive too, there are bad clients, but there are tons of good clients out there. If you stay positive, you’ll begin to attract the right clients. More about qualifying leads is found in this great article.

Not talking to the decision maker

I was called in to discuss a new website for a nonprofit. I soon discovered the contact had no ability to make any decisions, and those who could answer my questions weren’t available. This dude was a waste of time, but it was my fault. This is the third part of the qualifying process: Before you meet, you must ask this question: “Are there any other decision makers for this project, if so, what are their names and can they be present?” Dealing with the people who make decisions will save you from meaningless meetings and wasted time.

Not dropping bad clients after seeing red flags

If in mid-project, or after completing a project, you discover that the client isn’t a good fit, it’s best to break ties. If you don’t, you’ll be frustrated, angry and resentful and you may even say or do something that makes you look unprofessional. Bad clients can bring out the worst in you. I think the reasons behind why we put up with bad clients are: we haven’t done much marketing so we have to take what we can get, or we don’t know how to say, “No.” You have to turn away leads that don’t fit your business.

Not knowing the signs of a bad client

Another reason why we put up with bad clients is that many of us grew up in “dysfunction” and come to think dysfunctional people are ordinary. So, we end up not knowing what is acceptable versus unacceptable behavior. Along with obvious character flaws, here are a few signs your client and their company isn’t going to work out:

  • they demean you or your services directly or indirectly
  • they repeatedly falsely accuse you of wrongdoing
  • they lie to you
  • they keep trying to cut your prices down
  • they don’t show up to meetings
  • they keep canceling meetings
  • they often waste your time
  • they don’t want to sign your contract
  • they don’t want to honor the contract
  • they want to pay you when they feel like it
  • they’re controlling and manipulative
  • they don’t communicate
  • you just can’t seem to understand one another
  • you’re a consultant, but they refuse to listen to any of your advice
  • there’s “drama” in their workplace, and it negatively affects you
  • they treat others badly (they’ll soon do the same to you)
  • you’re always frustrated when working with them
  • they just make you uncomfortable
  • you just don’t like them

I’m not saying you should always strive for the perfect client and drop the rest. I’m saying: you have to know what affects you and what you’re willing to deal with for the growth of the business and your emotional well-being.

Not using a contract for every client

I always had a contract, but I didn’t always use it. Anytime money is involved, you must have a written agreement that says what’s expected of both parties and what will happen if either party doesn’t do what is expected. As you do business over the years, your contract will get longer. It’s good to review it ever so often for misspellings, confusing language, and holes that could be exploited. If you don’t use some form of agreement and get them to sign off on it, then anything can happen.

Not researching standard pricing for my work

Not charging enough leads to working with cheapskates who don’t value your services. I was naive when I first started. I didn’t know the going rate for web design services. I had a lot of projects but I was being taken advantage of and I wasn’t making the revenue that I wanted. So you have to know the going rate in your industry. Usually, it’s double what you would make if you were working in-house, but do a Google search and find out for yourself.

Not sticking to my prices

After learning what I should be charging, I changed my prices, but people complained, so I lowered them for fear of losing business. By yielding to the complaints, it kept me in that small pond I was trying to get out of. My advice is: ignore their complaints and don’t fear, there are more profitable clients out there waiting to work with you — stick to your prices and increase them as you expand.

Giving out discounts

What I thought was a nice gesture to give discounts to those who bought two or more of my markup services really turned out to devalue my business. I learned that “discounts are meant to reinforce the idea that the most important consideration for your services should be price,” but what I was offering was reliability, connection, and quality code — not cheap and fast markup services. My pricing strategy affected my business perception negatively.

An excellent article on this topic spoke about the difference between a fast food joint and an upscale restaurant, and which of the two you would expect to get a discount from. The cheap low-quality burger joint was the answer. So if you want to be treated like a respectable, high-quality service, don’t give discounts. Even though you want to reward your loyal clients, find other ways to do so.

I also want to add another reason why I started discounting: because I was asked to by another design company. I should have taken this as a red flag and kindly rejected the idea, but I feared they wouldn’t continue to send me work. I learned that people who attempt to cut your prices don’t value your services and it’s best to work with someone else who does.

Not charging for everything

Sometimes I would do things for free for a client because I felt it would be quick, and I didn’t want to bother with trying to figure out how much to charge for something so small. Well, those quick small changes turned out to take longer than usual. So here I was again losing money. I now know that it’s totally understandable and reasonable to charge hourly when your client calls for a small update or an addition during the project. Not charging for everything spoils the client into thinking they can get stuff for free. It also communicates: “you don’t value your own time,” so why should the customer value your time? Working out these kinds of requests in the contract is important. The agreement can say, “small changes will be X amount, if they go over x minutes, I will bill at x.” Make sure you pay yourself for everything you do.

Not always tracking my time

After several years, I decided to track my time, I was surprised. I found myself spending double the amount of time I was charging for! This is why you should always track your time for each project. The problem was: I was working off an old price sheet made from guesstimated hours. I discovered some apps do this, but I now use a simple time sheet. Make sure you’re getting paid for every hour you spend working for your clients.

Not having side income

There’s going to be dry spells, you’ll need money during these times. I didn’t prepare until it was too late. I would advise not to quit your day job if you have one. If you don’t have a job, get a part-time job doing something simple. You can also make some passive income by selling graphics, WordPress templates, eBooks or whatever. Just know that you’re going to have to do something to supplement your income until you get established. Failure to do so will place you in some desperate situations.

Being stingy with vendors and subcontractors

I’ve been the guy who hired contractors then got them to lower their prices. Then I had it done to me. I didn’t like it, so I didn’t do it to anyone else. My advice is just to pay your subcontractors what they ask for. If they’re good, it will benefit you both, and the cost will be passed to the client anyway. If you don’t like what someone charges, find someone else, but don’t try to change their price, this says you don’t value their work.

Not accepting how some clients see web design: as a commodity

Some clients simply don’t value web design as we do and therefore won’t pay top dollar for it. With the rise of crowd-sourcing, free or cheap WordPress templates, and companies from India that will do the job for a third of the cost, what we do has become a commodity in the eyes of some clients. Ignoring this fact leads to the loss of work. Accepting this fact, educating clients on the downsides of the cheap alternatives, offering additional solutions that make the client more money, and then emphasizing these extra benefits highlights our value in their eyes; and keeps the business flowing and growing despite the cheap low-quality services.

So those are the 19 mistakes I repeatedly made in my web design business, and what to do about them. I hope you take heed to what I’ve written. I’m just now learning to apply these points to my business. So while I’m very good at my craft, I’m starting all over when it comes to my business. I believe with determination and support from like-minded, positive people, I’ll be successful and so can you.