How To Start A Service Business
By Tom Egelhoff
 Starting a service business is one of the
more difficult businesses to start because you don't always have
a product that the customer can see or touch. The actual product
of the business is you. And, if you are unknown to your customer,
you may have a tough time in the early going convincing a customer
that you are a professional at what you do.
In the early stages of your business you may need to provide
all or a portion of a job to some customers to assure them of
the quality of your work. A cleaning service may give one month
free on a six-month cleaning contract in order to demonstrate
the reliability of the company.
In this weeks article I want to show you what you'll be up
against when starting a service business and some pitfalls to
avoid. So let's get started.
Why Do
You Want To Go Into Business?
One of the first questions anyone going into business has
to ask themselves is why do you want to own your own business?
For some it may be doing a type of work that they enjoy. Perhaps
you are looking for financial freedom. For others it may be that
they just want to be their own boss. If the latter is you, then
I have some news for you. The business will probably become your
new boss. Sometimes a business has a way of taking over your
life and you'll find yourself with less free time than you had
working for someone else. (See: Self-Analysis
For Going Into Business)
Starting a new business, service or otherwise, also requires
a certain amount of risk. You are probably going to have some
kind of financial investment in your business and if the business
is unsuccessful you risk losing that investment. There is also
a risk of reputation in a service business. Since people don't
have a product to be dissatisfied with they are going to voice
their dissatisfaction of you to their friends and neighbors.
(See: How To Be Perceived As An Expert
In Your Field).
In addition, if you are starting your business while still
working for an employer there are three reasons for business
failure you should know about and you can find those here. See:
Small Business Failure: (Three Reasons
Why Your Business Will Fail & How To Avoid Them)
What business
are you really in?
You may think you clean carpets but what you really do is
provide a healthy clean home. Or you may think you have a typing
service but what you really provide is perfect letters, reports
and other documents to customers that don't have time to do them.
Before you can effectively start a business you must be crystal
clear on what you are really providing to your customers. (See: Define Your Image To Your Customers)
The real question to ask is what benefit will a customer receive
from dealing with you?
Where do
the customers come from?
Every business has a target market. These are the people who
are most likely to want or need your product or service. Your
target market will have certain characteristics in common. They
will be in a similar age group, have similar education, income,
marital status, watch similar TV shows, listen to the same radio
stations and read the same newspapers and magazines. (See:
How To Make Friends And Turn Them Into Customers) http://www.smalltownmarketing.com/friends/html
In order for your business to be successful you must find
who these people are and the most economical way to reach them
with your sales message. (For How To
Find Your Target Market, See: Target Marketing: Who They Are
And How To Find Them)
Who are
your competitors and how do you compete against them?
One of the biggest mistakes small businesses make is trying
to, "Keep up with the Jones's". Just because your competitor
does something doesn't mean you have to match them. Do what you
do well and the money will follow. There is always going to be
something you can do that your competitor either can't do or
they don't want to do.
Make a list of your services and your competitor's services.
What do you do they can't? What do they do that you can't? Are
the things that you can't do temporary or permanent? For more
on this, (See: How To Research
Your Competition) http://www.smalltownmarketing.com/competition.html
and (Who is your real competition?
The answer may surprise you.) http://www.smalltownmarketing.com/competitor.html
How will
you advertise your service business?
Mastering the art of advertising is one of the hardest lessons
for any business. And, it's even worse for a small town business
because you are probably the advertising department. You may
know everything there is to know about cleaning carpets but probably
not a lot about advertising and marketing. That's not a slap
at your intellect it's just that you've spent most of your time
learning your craft and never had the need till now to learn
about advertising and marketing. See: (Advertising:
Learn From The Mistakes Of Others) http://www.smalltownmarketing.com/admistakes.html
Large firms have the benefit of larger profits that will support
a marketing or advertising firm. But many small businesses just
don't have that luxury. So if you don't learn anything else on
this site please learn this. Advertising must be an investment
it must not be an expense. I know it seems like an expense when
you are writing that check for the radio or newspaper ad. Make
sure before you advertise anywhere that there is a reasonable
expectation that the advertising will reach your target market
and produce more dollars in business than it will cost. If this
happens, advertising pays for itself. Here are two pages that
will help you plan your advertising strategy and save some money.
How to Create A Small Town Advertising
Plan http://www.smalltownmarketing.com/adplan.html and
25 Low Cost Advertising Plans
http://www.smalltownmarketing.com/advertising_tips.html
The Last
Word On Starting A Service Business
This is only a short synopsis of things you should know about
starting your own service business. However, they will give you
some things to think about. Free help is available to help you
at the following places.
http://www.score.gov
This is the Service Corps Of Retired Executives they are people
who have been where you want to be. Their advice and help is
free. Check their web site for the SCORE office nearest you.
http://www.sba.gov The
Small Business Administration. These people can help with business
plans, financing and other business start-up information.
Owning your own business can either be buying a job or working
at a labor of love. If the latter is your driving force then
you are destined for success. Remember, do what you love and
the money will follow.
(To The Main Menu)
This article may be reproduced for your non-profit group or
organization provided it is not altered in any way
and the following is attached:
Used With Permission
©2000-2002 Eagle Marketing PO Box 271 Bozeman, MT 59771-0271
http://www.smalltownmarketing.com - (406) 585-0219 - Toll FREE
(888) 550-6100
email: tommail@smalltownmarketing.com
Based in Bozeman, MT, Tom Egelhoff is the author of How To Market, Advertise & Promote Your
Business Or Service In A Small Town, and The
Small Town Advertising Handbook: How To Say More And Spend Less.
He is also a seminar and workshop presenter
and trainer. He may be reached at 888-550-6100 or PO Box
271 Bozeman, MT 59771-0271
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