pricing

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How Do I Start A Business?

Posted on by Jason Kanigan

How Do I Start A Business? Here is my answer to a "Can you give me a 10 minute call on How do I start a business" question, from a large group of coaches (and would-like-to-be-coaches). Maybe it'll help someone out here in the wild. Let me explain the process in six straightforward questions you must answer:

Starting a Business: The Positioning Element

1. Who will you help? Identify a target market.

2. What will you help them with? Financials? Strategy? Operations? What's your offer?

I think of this as "taking the client on a bus trip". You pick them up at Stop A. Where is that? And then you take them on a journey and drop them off at Stop B. Where is that located? How is that location/situation better than where you picked them up?

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Hit Your Target Audience by Making Specific Choices and Doing Your Research First.

3. What size of problem are you solving for them?

You can have a number, but it's best to have the client do the math and figure out how big the problem is. You can easily charge 5% of the size of the problem. Maybe 10%. Maybe more, if you have good reason to charge more. This is more formally known as “budget” (which is not “is the prospect breathing and has a dollar in their jeans?”). I have made videos and content on this concept, called “Monetizing The Problem”, for a decade.

Looking around and seeing "market rate" to figure out your pricing is a common and foolish idea that keeps people poor.

The Traffic and Conversion Element

4. How will you find your target client? Where are they?

5. How will you begin a conversation with them, and eventually sell your service? Map this out.

How Do I Start a Business: The Fulfillment Element

6. How will you deliver your service? How will you and the client know when you are done (dropped them off at Stop B)?

These are the basics. You get to choose. You get to choose your customers. You get to choose the problem you solve. You get to choose the size of problem you solve. You get to choose how much you charge. I believe you should choose a target market and a service that you enjoy talking about all day. That way you will be automatically enthusiastic. There must be an overlap between that and what people will pay for, or you will have a hobby and not a business. Many people make this mistake.

Many of your limiting beliefs will impact these choices. Since they are limiting beliefs, you are likely to be unconscious of them.

Final insight: you can outsource anything on the list.

>> Jason Kanigan is an agency growth expert. Book a consultation with him here <<

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No Obligation To Sell

Posted on by Jason Kanigan

Do you have no obligation to sell...or must you try to make a sale with every prospect who comes along?

This event occurred two years ago. Facebook Memories brought it back to my attention. I find it amusing.

I guess you could see it as alarming, too, but that's not the way I choose to view it.

A young person from Italy messaged my sales training page, Sales On Fire, demanding to know the price.

When I did not instantly respond, he escalated to swearing.

I do not put up with abuse (sales hint: how they treat you now is how they will treat you later), so messaged that I would not be working with him, and blocked him.

Google searches are easy to do and our young friend quickly looked up my SOF business phone number. I had it for a decade. I know because shortly thereafter I began to receive calls from a number I (also using google) traced back to Italy.

No doubt he wanted to give me a piece of his mind 😉 Good for him and his persistence. He will probably make something of himself.

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Image by Rose McAvoy from Pixabay

 

As The Seller, You Have No Obligation To Sell

But here's the fact about being the seller:

** Until we have said Yes to the deal and accepted the money, we can say No.

Right up to that moment. **

We have no obligation to sell. We are under zero obligation to give information, do free consultations, provide our pricing or anything else.

Blocked and gone on that platform, too.

We have no idea what this person wants with information from us. Are they doing a price survey for positioning their own offer? Are they asking about price because they don't know what else to ask about or value? Another of a myriad of reasons, not all of which are friendly?

It is part of the role you play as a seller to qualify your prospects. Some you will want to turn away.

Just a reminder of the power you have as a seller, prompted by this funny memory. No one can make you do anything you don't want to do in sales. You're the one in control of the process. Not everyone should be a customer.

>> Jason Kanigan is a business strategist who knows that people asking right up front, "So, what's your price?" probably aren't interested in working with you. To book a session with Jason and discuss your situation, click here (and yes, you're being qualified.) <<

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Living With Uncertainty

Posted on by Jason Kanigan

UncertaintyLiving with uncertainty is a fact of entrepreneurial life.

It's so emotionally brutal a fact that most people can't face it. They shy away. The job road is so much easier.

It has torn apart marriages, destroyed friendships, and hurt families.

Uncertainty is something you and those around you are going to have to get a handle on if you are going to travel this path.

Far Fewer People Than You Think Are True Entrepreneurs

Let's take a look at how many people are really taking that leap.

The number of real businesses being created every month is far fewer than you might believe.

Let's take the US. Population: about 319 million.

More businesses are shut down than started, according to Forbes. Other sources say births and deaths are about even.

At any rate, we're talking about around 500,000 people who have decided to open a new business this month.

Most of these, however, are not "employer firms," meaning they don't employ anyone and have an average annual revenue of $44,000. Enough to support one family, perhaps.

Also, a large fraction of these startups are created by people who already own one or more businesses--thereby cutting the total with entrepreneurial commitment even lower.

Historical data (p.3) says 10-12% of firms with employees open ever year, and about the same amount close every year.

So let's say over a year we have over 650,000 new businesses being created. About the same number are closing, but let's focus on the births. I couldn't find the source I'd seen before of how many startups were opened by people who already had a business, but I remember the number was close to 50%. Let's say conservatively that it's 25%.

So that leaves us with about 4.9 million true entrepreneurs who took the plunge this year, and that's being generous.

Out of a population of 320 million, that's about 1.5%.

And I believe it's less than that.

Not Many People Can Stand Living With Uncertainty

Now there is some statistical fuzziness in here, because every year new people do make the entrepreneurial leap...but so too are those who failed in a previous venture and are returning, or starting a second or third or twentieth business and would be double-counted. Estimates vary from around 8% to 13%.

This article from Entrepreneur.com explores the question of "Who is an entrepreneur?" The answer is not so easily defined as you may think.

My takeaway from this little analysis is about 1 in 10 persons in the US is comfortable with the idea of being self-employed, and another 1 or 2 in 100 takes the plunge over a given year.

Meaning the vast majority of the people who say they'd like to start their own business are scared to death of the uncertainty.

Most stay employed with the "regular people", where they feel it's safe.

And who can blame them? Most businesses fail, and quickly.

The first two years are often a terrible struggle.

And most businesses fail before the end of their fourth year.

As we entrepreneurs know, however, your job can be whisked away from under your feet at any time.

There are no guarantees.

How To Be An Entrepreneur and Stand Living With Uncertainty

The fear of living with uncertainty is paralyzing.

If you are really going to take the leap and become an entrepreneur, open your own business and face the heat, be ready for the uncertainty.

Make sure, if you have a family, that they are ready for the uncertainty.

Know your budget before you begin.

How much revenue do you need to bring in every month?

What are your expenses?

Have you figured out what is absolutely necessary, and what is optional?

If you have family, are they prepared for possible cuts in the lifestyle they have now and expect to continue?

The truth is there is uncertainty in everything.

If you step outside of your home, uncertainty raises its ugly head.

As a self-employed professional, there's nowhere to hide. Nowhere to go. No one to fall back on. You simply need to get it done yourself.

And this highlights an important fact: Personal responsibility trumps uncertainty.

Have you figured out your budget?

Do you have a revenue plan?

Do you know, in detail, what you need to do and how you are going to carry it out to make that revenue?

If you do, the pressure of uncertainty will retreat. Your sense of personal responsibility will be taking control.

If you don't, and you are trying to make "as much as you can get," then you are leaving everything up to chance. Small wonder the bugbear of uncertainty is right there in your face.

The numbers are scary.

Most businesses fail in a pretty short time. Well over half. What does that say about the entrepreneurs who founded them?

They don't have a budget or revenue plan. They don't have leaders who have taken personal responsibility for results.

They've left everything up in the air.

Less than 1% of the US population knows what it takes to be successfully living with uncertainty. To make it no big deal. You can be a part of this group.

>> For help with your revenue plan, talk with Jason Kanigan. <<