There are a lot of Top 10 lists out there, some of them focusing on the most common mistakes that small business owners make. While they contain some good points such as getting the support of your family, establishing a dedicated work space, focusing on good customer service, etc. Some others are good planning, but may not apply as much to an independent contractor in the software industry, or at least not for your first couple of jobs, such as establishing a good mission statement, and developing a detailed marketing plan.
While these are all relevant and may be important to you at some point in time, I have found that there is another set of common business mistakes that are much more practical, some are even stunning that anyone would commit. But before we get into my list, I suggest you read my post Doing Business - The Series for a little background. Now, with that out of the way, following is my list of the Top 15 Mistakes Consultants Make.
- Forgetting to bill the client
- Losing track of unpaid invoices
- Not setting aside money for taxes
- Bad contract negotiations / terms - no lawyer
- Poor tax records
- Setting bill rate too low / Discounting services
- Poor estimating / Over-promising
- Bad attitude
- Lack of market focus (trying to be everything to everyone)
- Delaying bad news
- Ignoring referrals
- No savings for a rainy day
- Dependent on a single client.
- All tech skills, no soft skills
I will expand on some of these subjects, and when that happens, this article will be updated with links to the more detailed posts. You may also want to check out the full Doing Business archive for more commentary on doing business right.
And remember, just because you're good at your job (or hobby) doesn't mean you know how to run a business. Many dot-com failures were cool ideas, maybe even fun hobbies, but not smart businesses. Many good cooks discover there's a whole lot more than cooking involved in running a restaurant. Being self-employed is awesome! It is a fantastic adventure if you do things right more than you do them wrong. And it's a right we have in the United States that doesn't exist everywhere in the world, so take advantage of it, if you dare.
posted @ Thursday, August 19, 2004 8:24 PM