Nancy's Medical Billing Operation

Today's business start up story comes from the USA - the land of opportunity.

Nancy McClendon, from the Detroit area, has recently launched Horizons Comprehensive, providing electronic medical billing and related services to organizations and doctors.

With over 20 years experience in the medical claims sector Nancy is confident that she has the knowledge required to create her own business. Medical claims procedures can be complex and in the US organizations need the confidence that their supplier will deliver a highly professional and cost-effective service.

Nancy laid the foundations for her business a few years ago when she sensed that her employer was considering major changes. Early in 2009 the cut-backs began and by October she was no longer in employment, allowing her to focus full-time on the new venture she'd been planning.

Horizons Comprehensive finally went live in December 2009. The first few contracts are already being processed and Nancy expects to see significant commercial activity in 2010, with the business reaching its target level of operation the following year.

The nature of a business usually determines the level of investment required to get it off the ground. Nancy has made a substantial investment to buy the equipment and resources that she needs to deliver a professional service from day one.

She's also having to deal with the usual problem facing a start up - a significant drop in income. When you've been earning a good salary for 20 years it can be hard to adjust to a different way of living. Nancy's not afraid of that challenge and has cut her living costs dramatically. Like the cash she's put into the business, it's an investment in her future, as are her long working hours.

Nancy has learned that when you're starting your own business you can't be an expert in everything. She had to find a way to promote Horizons Comprehensive and decided to use sales and marketing reps with the skills and knowledge needed to open the right doors. She understood that the steps taken to make potential customers aware of a business will determine the level of success.

Her advice to anyone starting their own business is: "It is not easy but at the end of the day you have a satisfaction that is unexplainable. Never give up."

If you'd like to know more about the services that Nancy's business offers, why not pay a visit to the Horizons Comprehensive website?

Have you set up a business in the last few years? Have you got a story to share? Drop us a line via email.

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Problems Facing Business Start Ups

Starting a business is easy. Making it succeed can be incredibly hard.

Almost everyone who enters the world of self-employment must overcome a variety of challenges. Here are some of the main problems they'll face, and that you'll probably have to deal with if you decide to go into business for yourself.

1. Finding customers - If you open a shop on a busy street you'll have people coming in from the first day. But if you're selling web design services or running an online service it's harder for people to find you. Winning the first few customers is a struggle for many start ups.

Ideally, as you plan your start up you should line up one or two customers in advance. Find people through your network of friends, family and colleagues. You might have to offer incredibly good deals to secure them, but having a couple of customers in place helps with word of mouth marketing and testimonials and it introduces you to the demands that they place on you.

2. Being taken seriously - This can be a huge problem for the young or for women, particularly those without a professional background. Friends and family may find it hard to see you as a business owner, which reduces their value as a networking resource.

The best way to overcome this is through success, measured by generating an income that you can live on. Unfortunately their attitude can make this harder to achieve, which is why it's important to maintain your confidence and keep a clear sense of purpose.

3. Knowing how to do everything - No one is an expert in every aspect of running a business. As a sole trader you'll be doing the business planning, marketing, selling, administration, bookkeeping, and customer support. If you're offering a service you need to have those skills as well. A common complaint from those going into business is that they don't have the knowledge or ability to cover all these different roles.

You need to identify early on what you can do and what you can't, or at least what you like doing least and what impact that will have on your business. Where possible try to get some help in the difficult areas. For example, there are plenty of people around with bookkeeping skills who'd be happy to sort through your receipts from time to time and write up the accounts.

4. Finding the time - Of all the resources you need to run a business, time can be the hardest to deal with because you can't create or borrow more of it. Ask anyone who's setting up their own business how many hours they work and the answers will be 'lots', which usually means 10-12 per day, often for 7 days a week.

Before starting your own business you need to be confident that you and your family can cope with the demands it will place on you. There's no way to be absolutely sure until you start, but it's an issue that must be addressed in advance. If your family are used to you working 9 to 5 and you give that up for self-employment, they have to know that the hours will be much, much longer in the early months or even years.

This is not an exhaustive list of the issues faced by those setting up their own business. But it gives a flavour of the challenges that await if you're thinking of going in this direction.

It's not all hard work and problems. Being self employed is also hugely rewarding in terms of personal satisfaction and if your business succeeds there are going to be financial benefits. You are also master of your own time to a considerable extent, although there will still be deadlines to meet or specific hours to keep.

Every day, all around the world, people are setting up new commercial enterprises. They're motivated by many different factors and they have differing expectations of how easy it will be. Most of them will quickly discover that working for yourself is extremely demanding, but if they make it over the first few hurdles they'll also find it brings many benefits.

Brian Answers the Business Call

Ten years in business taught Brian Barnes that he had excellent customer service skills.

His background was the licence trade, running bars and clubs, but he wanted a change. He couldn't find something that he felt matched what he had to offer, until he discovered call answering services. This seemed ideal, allowing him to pair his customer service expertise with his desire to work with a wide range of different organisations.

Making an investment of £500 he founded Call Assistant UK. The business model is simple - they provide a telephone answering service for individuals and organisations.

There's clearly a demand for the service because he now employs one full-time and two part-time staff and they've moved into larger premises, and they've only just begun their second year of trading. Brian's expecting business to increase by a massive 200% in 2010, and he's got the commercial experience to know that's a realistic figure.

If there's one thing Brian wished he'd known before he started out it was to have had a deeper knowledge of the industry. He made a few mistakes along the way which, with more information, could have been avoided.

Brian's achieved what many aspire to: he's matched his passion with a commercial opportunity and he's made it work. But it hasn't been easy - the hours are long and he misses the face-to-face interaction he had in the licence trade. But he feels it's worth it to be running a business that's succeeding despite the recession.

If you'd like to know more about the services that Brian's business offers, why not pay a visit to the Call Assistant UK website.

Have you set up a business in the last few years? Have you got a story to share? Drop me a line via email.

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Olivia Wins a Starring Role in TV

Solicitor Olivia van der Werff is no stranger to business start ups. 

Some years ago she established a health and safety consultancy which she franchised and then sold.

Her latest venture, Beyond Dispute, is a great example of a business that began and grew in a gap in the market. It also grew out of her health and safety background - her firm provided H&S services on a television studio construction project and shortly before shooting she was invited to provide adjudication services for a new quiz programme.

Adjudicators are required on every show that involves quizzes or competitions. Their role is to ensure that if something goes wrong or a contestant is unhappy, a decision can be arrived at which is fair and reasonable.

Once Olivia started working in this area she discovered adjudication was a service very few businesses supplied and television companies relied heavily on very expensive, high profile accountancy firms. She could offer a much more cost-effective solution if the production companies could be persuaded to work with a smaller business.

Her strategy has proved successful. Although it's relatively new, her firm Beyond Dispute now employs four people and uses a team of a dozen freelance adjudicators. Olivia is confident that turnover will triple in 2010.

Setting up a service business does not always require a large investment of cash, but it does demand time. Olivia has poured hours into getting Beyond Dispute off the ground and she's pleased to have broken into a market where there is so little specialist competition.

Her advice for anyone else starting in business is to avoid turning into a "busy fool". You mustn't get bogged down in bookkeeping, marketing and administration. They're all important but you need to focus on what she calls the "widget", the thing that you do that actually makes money. Because at the end of the day that's what running a business is all about - generating an income.

Visit the Beyond Dispute website to discover more about the services that Olivia supplies.

Have you set up a business in the last few years? Have you got a story to share? Drop me a line via email.

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Trina Makes Her Own Success

Do you want to run your own business from home, using a skill that you already possess and doing something that doesn't require a huge investment of cash?

That's exactly how Trina Jones of New Zealand felt. She'd worked for years as a legal secretary but when her children arrived she wanted to focus on caring for them, which meant finding a job which fitted around their needs. She was a school administrator for a while but following a relocation in Auckland she found it very hard to locate another role that met her requirements.

That's when Trina experienced what she calls her 'moment of enlightenment'. She has excellent typing skills and she'd done audio transcription work in the past, so she decided to set up her own business from home, Purple Giraffe Transcription Online.

To her surprise, it worked. Business started to come in. In her first year, ending in late 2009, the turnover was in excess of NZ $25k and Trina is optimistic that business will grow considerably. She's invested NZ $4k and lots of her own time. She's discovered that the most successful form of marketing is by word of mouth and her main frustration is the low return on paid advertising.

Trina has also learned a great deal about herself, the internet and running a business. She's discovered how committed and determined she can be, which helps to overcome the occasional sense of isolation that comes from working at home.

One piece of advice that Trina has for anyone else looking to start up in business is "to keep the down times in perspective". They will come, but it's essential to remain upbeat and proactive and to get through them.

What Trina's really looking forward to, like so many other new entrepreneurs, is doing business in a thriving economy rather than one that's in recession. The good news is that she's been able to set up and maintain a business at a difficult time, putting her in a great position for the future.

Visit the Purple Giraffe Transcription Online website to discover more about the service that Trina supplies.

Did you set up a business in the last few years? Have you got a story to share? Drop me a line via email.

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Making Customers Want You

A Guest Posting by Nick Bramwell

One of the things I’ve learnt is that as a small business it’s really hard, in fact maybe impossible to compete on price.

If you’re selling a product the big companies, such as Tesco or Amazon, will almost always be cheaper.

If you’re providing a service, such as web page design, the cheap competition comes from the opposite direction. There are plenty of amateurs willing to do the work for less because they have a day job to pay the mortgage and they just want some extra spending money.

So how can you compete?

Competition drives prices down and reduces quality because you can’t give customers as much time and attention. So if you can’t compete on price, you can choose to compete on quality instead.

Over the last year I’ve met lots of people at events and I’ve done plenty of networking. If you take the time to get to know people they could turn to you when they need your services or products.

I met a lady a little while ago and we spent a while talking about web sites. The price I charge for a web site was outside the budget she had, but after we’d talked, she didn’t just want a web site, she wanted one of my web sites. She decided to save up the money to afford it. In the meantime she keeps telling people she thinks my work is great and that they should get me to design a web site.

By investing a little time talking to her I’ve won a great evangelist who tells people how much she likes my work. If I tell you my work is great then you may just believe me, but if someone else tells you how great they think I am it sounds much more believable.

There are times when we all go for the cheapest option. If we’re buying petrol then we go for the cheapest filling station because to most of us, petrol is the same wherever you buy it.

But sometimes we want to buy something that really matters to us. If you’re a coffee lover then there is a huge difference between a cup made with cheap instant coffee or freshly ground beans. You’re willing to pay the extra for quality, because you appreciate the difference.

Final thought

Something I heard once was “give and forget, receive and remember”. That means if you help someone else out, forget about it and don’t expect anything in return. If somebody helps you out though look for opportunities to help them back. This helps you to become the kind of person that others want to do business with.

Nick Bramwell runs TwoLittleFishes web site design.

TwoLittleFishes creates web sites for small businesses. Great web sites should be easy to use and provide valuable content to customers and potential customers.

David Splashes Out in Scotland

Another in the series of articles celebrating businesses founded during the current recession.

David Chick has a passion for business. He's been selling since he was 16 and kept working while he studied for a degree in economics in Aberdeen. In 2008, at the ripe old age of 22 he decided it was time to stop flogging advertising space and take what he calls a "leap of faith" into a gap in the market.

He started selling hot tubs and created the Galaxy Spas brand in 2009. He sells luxury hot tubs and spas, offering a nationwide service which already boasts a turnover of around £400k and he's optimistic of a 50% increase in the next 12 months. But it wasn't a cheap operation to set up, requiring an investment of £150k.

Why did he choose hot tubs and spas? "I thought it would be fun." He was also confident of his selling skills and he believed he had found the one thing entrepreneurs love: a space in the market that was waiting for someone to fill it.

Hot tubs don't come cheap and they take time to produce and deliver, meaning a lot of cash gets tied up very quickly. Cash flow is probably David's biggest single issue and he deals with it through careful management of his resources.

If there's one thing that David wishes he'd known before becoming self-employed it's how a new business can take up all your time and energy. Working seven days a week puts a real squeeze on his personal life and to add to his challenges he's launching another new business next month - Fantasy Garage Doors.

But he's not bothered, because he loves it. "Ultimately I am doing what I always wanted to do - run my own business - and I believe one day it will all be worth it."

Visit the Galaxy Spas website to discover more about the products that David supplies.

Did you set up a business in the last few years? Have you got a story to share? Drop me a line via email.

Read more stories like this one.

Take Control of Your Debtors

Cash is tight at the moment.

For many it's an achievement to pay the staff on time every month. It's at time like this you're grateful for your customers but you wish they'd pay up more quickly.

It's a quirk of language that managing your debtors is called credit control. But whatever it's known as, it's a vital part of your business that you cannot afford to ignore.

Giving customers time to pay is standard business practice. But just because you allow them 14, 30 or 60 days doesn't mean they should get away with taking twice that long. I happen to know a local business that insists on paying on time, or even early, but they're in the minority. I also know plenty who'll only cough up once you've jumped several hurdles every month.

Here are some suggestions for sharpening up your credit control:

1. Set a target. Your accounting system should let you analyze what percentage of your debt is more than, say, more than 60 days overdue. Make a note of that number and set a target of reducing it by, say, 50% in the next month.
2. Don't be afraid. You're unlikely to upset someone by asking for money; don't be frightened of losing their business by being a little firmer in your approach.
3. Telephone your debtors. Emails and printed statements are easy to ignore; it's not so easy to overlook someone on the phone.
4. Take the name of the person you're speaking to and if they try to fob you off by saying the invoice still needs to be authorized, ask for the authorizer's name as well.
5. Make a record of every conversation including the date and time, who you spoke to, what they said the next steps were and how long it would take. Next time you call you can remind them of what they agreed to do.
6. Don't ignore the small debts because the older they get the harder they are to pursue.
7. Do it every day. If you don't have a dedicated credit controller make sure someone gives time every day to chasing debtors.
8. Check how you've done. Remember that target you set in step 1? Whether you achieved your target is not as important as whether you've reduced your debtors, because if you have, the process is working. What you need to do is keep at it.

There are plenty of other tips for debt chasing and feel free to add your own in a comment.

One final point. When you give a customer 30 days credit it means on the 30th day they should pay you, not start the authorization and payment process. Remember that and feel free to remind them of it.