As a business owner, it can feel like there’s a never-ending stream of ‘essential’ business purchase decisions to make – things that you believe you should spend out on if you’re going to make a success of your business.
This is especially so during the first couple of years, which in my case was when I had zero disposable cash. I had to borrow from my husband every time I needed to buy anything for the business, so I felt I should be more sure than not that I was investing wisely before I asked for (yet another) loan from him.
Even then, I got it wrong a few times…
So, with that in mind, today I’m sharing my list of poorly judged business purchases, that with the benefit of hindsight, I wouldn’t repeat.
Poorly judged business purchase #1: Local business networking groups:
I joined BNI within weeks of starting my business, after being told that I must attend local networking groups to meet people, or I’ll never find any customers.
However, what I hadn’t fully comprehended back then is that I’m not limited geographically for clients. Even before I knew anything about leverage and I was only working with clients in person, I was active on social media, and I could ‘meet’ clients on Skype.
So I didn’t need to pay £1k+ to network with one small local audience – most of whom weren’t my ideal clients anyway.
For 11 months, I got up every Tuesday at 4am to be mobile enough to get out on time for the meeting. I got no more than 3 clients in exchange for all that effort.
Leaving aside the poor quality of that particular network for me, networking online introduces you to a far greater pool of prospects than you can ever hope to meet in a small group setting – with a lot less effort required too!
Poorly judged business purchase #2: Business cards
This purchase was made alongside #1, because the group insisted that you bring business cards to EVERY meeting, even though the majority of the cards ended up in the bin or a drawer, never to be seen again.
Nowadays, I teach my clients to always ask the people they’re talking to if they’d like to receive their free lead magnet, and if so, to take their business card. This way, you can control the follow-up, and you’ve been given permission to add them to your list so you can stay in touch and nurture the relationship by email.
This is a totally different proposition to collecting cards at events and adding everyone to your CRM by the way.
Never do that. It’s spammy and will result in a poor quality list.
Poorly judged business purchase #3: An expensive website
Ok, to be totally transparent, I didn’t spend thousands of pounds on my first website. But I did spend far too long worrying about the aesthetics of the website, and worrying about getting the branding ‘right’.
The thing is, when you’ve just started your business, you are still finding your way around how you want to represent yourself.
Of all the business owners I’ve met, I can’t think of one person who is still branding themselves exactly how they were on day one. I’ve massively altered my own business, and therefore, my offerings and branding are entirely different from how they were in 2010.
In the early days, I recommend you invest in a WordPress self-hosted website with a premium theme so you’ve got the basics covered, but leave any major investment in websites and branding until you’ve had a chance to establish what you’re about.
Poorly judged business purchase #4: Serviced office space
I didn’t get quite as far as paying for this, but I did get as far as agreeing to rent an office. Luckily I was able to get out of it the next morning when I came to my senses.
When it’s just you working in the business, an office is an unnecessary expense. It’s another sum of money that you’ve got to earn each month before you can begin to make a profit.
Don’t put yourself under that kind of pressure when you’re still getting established. Working from home is a much better choice until you’re confident that you have enough consistent profit each month, to cover the investment in office space.
What I did instead was to invest in a virtual office. This is a service that many serviced offices provide, where you get to use their address on your business communications.
It costs approximately £50 a month, but with the need to show a physical address on your website and in email marketing communications, it’s a much better option than plastering your home address all over the internet.
Most virtual office packages also offer discounted meeting room hire, so if you do need to meet clients “at your office”, you can hire a room in their building on an hourly basis.
Poorly judged business purchase #5: A tied telephone number
Pretty much from day one, I hired a telephone answering service to pick up all inbound calls.
That was a fantastic decision, and we still use a telephone answering service today. No business owner should ever be answering their own phone. It’s a distraction and isn’t the best use of your time.
In fact some time ago, I wrote a whole blog post about just how much answering your own phone could be costing your business. You’ll find that here.
The mistake I made was to get a telephone number that was tied to the first answering service I hired. While this was the “easy option”, it meant that if in the future we wanted to leave that company and hire a different answering service, we’d lose access to the telephone number that was listed on the website and business cards, etc.
Instead, what I should have done (and do now!) was to buy a geographical telephone number myself (we buy ours from Invoco), and divert that number to the call answering service to pick up. If you then decide to switch to a different service, you just redirect the number to the new service.
The telephone numbers we use are free, then we pay £0.99+VAT per month for the use of the number, plus call time for calls made to that number.
We have 6 telephone numbers from them, and they are all redirected to our call answering service.
Our invoices are around £7-10 per month. It’s not a major expense to do it this way, but because you own the number, you’ll have the security of knowing that no matter who you hire to answer your phone, you’ll always be able to accept calls on your published number.
So that’s my list. Next time I’ll share the early investments I did make, that I’m so glad I did.
How about you? Did you make any major purchases in your early days, that with the benefit of hindsight you wouldn’t do again?