Advertising
Advertising

8 Myths About Starting An Online Business

8 Myths About Starting An Online Business

You’ve come up with an awesome new product idea. Of course, it happened in the shower and you scrambled to jot it down. After rambling about the details to your friends and family, you’ve finally mustered up the courage to build a prototype.

Once again, your family and friends give you the thumbs up, but you’re still far from launching an online business. Everything about it sounds intimidating. You’ve watched far too many episodes of Shark Tank to the point that you’re scared about financing, building a website, and keeping up with marketing.

It seems strange to think about it at such an early stage, but saving money for your online business is often priority number one. Why is this the case? Because chances are you don’t have that much start-up capital and most successful businesses pinch pennies in the early stages regardless.

This gets you thinking about some of the statements you’ve heard about managing your costs, some of them coming from Shark Tank, but most of them coming from naysayer friends or people you’ve met at social events.

Here’s a tip: Forget about all of those statements, because chances are they’re myths. Your business plan is better without them, but it’s also important to realize which of them are myths in order to decide on which you should brush aside.

Advertising

You’re in luck, because we’ve compiled some of the more misleading myths about the costs of starting an online business. Go and grab your pen (or bookmark this page,) because you may find some surprising insights.

Myth 1: You Can Start an Online Business for Free (Or A Small Amount of Money)

You’ve all seen the ads that tell you about certain online website building platforms that provide free services (or close to free) online shop creators. In addition, there’s always that self-employed friend that’s telling you how inexpensive it is to get started online.

Although the ideal online store building solutions are fairly inexpensive, you can’t possibly expect to spend less than at least $500 per year on just your website. After all, this is your storefront. It’s the primary way you’re going to make money, and if you plan on expanding that business, it’s going to require investments.

The free (or close to free) online business is a marketing ploy to prompt you into buying. That doesn’t mean you have to spend $10,000 your first year developing a site, but it’s prudent to budget for more, rather than nothing.

Myth 2: You Can Only Start an Online Business With Lots of Startup Capital

On the opposite side of the spectrum, the days of spending ten or twenty thousand dollars on a web developer or marketing person are over.

Advertising

Yes, development is often the most expensive part of building a new website, but tools like Shopify, Bigcommerce, and even WIX provide you ready-made tools for launching your site and expanding it to a powerhouse. You don’t need a huge donation from your dad, so leave him alone already.

Myth 3: Many People Who Work Online Work Part-Time Hours but Make Full-Time Wages

Sure, you could go with a low cost business idea, like arts and crafts or selling your freelance services, but people who partake in these endeavors still put in the work to bring in clients and run their businesses just like anyone else.

In fact, one could argue that the traditional 40 hour job is impossible while running an online business, since you’re more likely to spend 80 hours per week nurturing your own company.

Myth 4: Social Media is a Costless Marketing and Money Making Outlet

Anyone who has made significant conversions through Facebook, Twitter, or Pinterest can explain that social media marketing is far from free. Not only do effective advertisements cost money, but your strategy also requires loads of time and effort. In addition, you may end up hiring a social media person to manage the whole ordeal.

Myth 5: You Can Automate Everything When Selling Online to Cut Down on Labor Costs

Young business owners are prone to look for solutions that can completely automate their selling process. This ties into the fact that so many people crave the 4-hour workweek, but it also coincides with the numerous different apps and tools that have come out to automate processes.

Advertising

Let’s break it down.

You can’t completely automate your customer support. You can’t completely automate your social media. You can’t completely automate your receipts and promotions and returns. Labor costs are required, because people run businesses. It’s essential to keep this in mind for your budget.

Myth 6: A Large Promotional and Advertising Budget is the Key to Success

Mark Cuban repeatedly talks about how pouring money into a promotional budget is the last thing you want to focus on with a young company. This comes as a surprise, but you probably can’t even get an investment or SBA grant unless you can already prove that your business functions without the need for a huge marketing budget.

Myth 7: Processing Payments is Going to Break the Bank

Although it may be true that payment processing fees are going to pile up, putting in quality research to locate the most cost efficient solution can cut those processing costs and keep your company afloat for quite some time.

In fact, it’s imperative to locate the right payment gateway company for your brand, because 1% or 2% extra on each transaction can add up quickly.

Advertising

Myth 8: All Tasks Must be Completed by You or You Must Hire Someone Full-Time to Do Them

Online business owners frequently feel like every task must be completed in-house, whether it’s with their own sweat and blood or by hiring a full-time partner who can assist them with tasks such as web development, graphic design, social media, and email marketing.

Nothing is further from the truth, because nowadays freelancers are your friends. Hundreds of sites provide gathering spots for graphic designers, writers, social media workers, and even data entry freelancers – all of whom are poised to work for you for reasonable rates. There’s no reason to hire a graphic designer and put them on your payroll when you can turn to a trusty freelancer on an as-needed basis.

Over to You…

The various myths about small businesses frequently change, so continue doing your research to ensure that you don’t fall behind the times. Think about it. Some of the myths outlined above may very well have been true a while back; however, times change. Flexibility and awareness are key components in your entrepreneurship arsenal.

Can you think of any other cost myths that hold back online businesses?

Featured photo credit: Computer/Wild Zontar via flickr.com

More by this author

Melissa Burns

Entrepreneur

Wealthy, Successful People Who Choose Less over More: 10 Real-Life Stories of Minimalists If You Want to Succeed in Life, You Need to Find Your True Calling First Why Do We All Feel Empty Sometimes Everything We Can Learn from the Most Famous Entrepreneurs Around the World YouTube Blogger 4 Pillars of Becoming a Successful YouTube Blogger

Trending in Entrepreneur

1 15 Best Books for Entrepreneurs to Start Reading Right Now 2 How to Start a Successful Business and Increase Your Profits 3 12 Foolproof Tips for Entrepreneurs to Be Successful in a New Venture 4 How to Start an Online Business That Will Grow and Succeed 5 Feel like Giving Up? 16 Way to Help Entrepreneurs Stay Motivated

Read Next

Advertising
Advertising

Last Updated on December 5, 2018

How to Lead a Team More Effectively and Be a True Leader at Work

How to Lead a Team More Effectively and Be a True Leader at Work

Being an efficient manager and a charismatic boss at the same time can seem like an impossible task. Is there a way to deliver the desired results for your business while remaining liked and respected by your staff?

We all know bad examples of team leaders who seem to fail at one aspect or the other, or even at both. But we’ve also heard of awesome managers who seem to juggle both things well enough.

How do they do it?

By sticking to few proven ways that let them maintain a positive karma score while remaining efficient. In this article, we’ll guide you through 11 smart management tips on how to lead a team and become something more than a boss – a leader.

1. Find a Management Strategy and Stick to It

There’s nothing worse than a boss that keeps changing his or her opinions and assignments depending on their mood or a book they read this week. Chaotic decisions increase the insecurity and frustration of your team, so you better find your strategy and stick to it.

If you do find some new methods you want your staff to follow, make sure they don’t contradict the general direction you are taking. Otherwise, you risk making your team take one step forward and two steps back.

2. Set Goals​ and Track Progress in Reaching Them

Set individual and collective goals​ for your team and track the progress in reaching them. This might sound obvious at first, but too often we find ourselves stuck between daily customer requests and monthly reports, and the bigger goal or vision seems to fade away.

According to Elon Musk (and many other successful CEOs around the Globe), it’s crucial to have a clear and motivating aim to where the company is heading. His aim for the space transportation company SpaceX is “to make humankind a multi-planetary species”.[1] That’s a huge goal but the company is slowly moving closer to it by reaching smaller steps and milestones, like launching self-landing rockets. This is also a very inspiring and meaningful goal that helps employees endure the company’s extremely high expectations and 60 to 70-hour work weeks.[2]

Even if your goals are not as grand, setting and reaching milestones will give you a clear insight into the team’s overall efficiency and daily progress. With time, you will be able to see the weak spots and improve your results.​

Advertising

3. Demand Learning from Your Team

CEO of print on demand startup Printful, Davis Siksnans, believes that:[3]

“The key for a company going through rapid growth is to empower your employees’ self-development.”

His company with 500 employees spanning two continents demands a culture of learning and provides all the tools necessary to do it.

Their idea is –  as the company scales, people have to grow in their positions too, which means that they have to be constantly learning. Siksnans says:

“We try to hire people for what they might become, but they need to have that drive.“

Alternatively, you can provide educational courses for your employees or invite informal lecturers to educate and inspire your team. You can also encourage peer-to-peer learning by asking employees to teach their particular experience or skill to co-workers.

4. Invest in a Pleasant Work Environment

Studies show that a well-designed office environment can increase your team’s overall performance by as much as 20%. You’ll be surprised to see that even very small interior tweaks that don’t require major investments can improve your workers’ performance.

Some ideas for a more productive and pleasing work environment:

  • Invest in modern furniture – offer ergonomic chairs, standing desks, and individually arranged workplaces​.
  • Start an in-house library – reading for pleasure just 30 minutes a day is proven to be enough to become more effective at work,[4] improve focus, and deal with problems like depression and anxiety.​
  • Play jazzy office music – rhythmic background music will help workers feel more energetic and enthusiastic while doing everyday tasks.​
  • Set up entertainment or break rooms – being able to relax and have fun at work creates a strong commitment, helps employees relax and clear their minds, and boosts productivity.​
  • Bring in uplifting office decor – it’s been found that art in the workplace can boost productivity,[5] lower stress, and even encourage employees to innovate.​
  • Decorate the office with live plants for freshness and a welcoming feel. Furthermore, plants are found to ensure better air quality and increase workers’ productivity by 15%.[6]

5. Be Kind and Sincere to Your Team

Did you know that 50% of employees quit because they dislike working with their manager?[7] In fact, most times when people leave their jobs they actually leave their managers. Being friendly and sincere may not be enough to be a successful manager, but it’s a big part of it.

Advertising

Some ways to show you appreciate and care for your staff:

  • Celebrate the progress and achievements of your employees. And don’t be shy to simply say thanks.​
  • Talk to your employees regularly and really listen to what they have to say. Address their concerns, help them reach their goals and do your best to improve their work and daily life.
  • If you’re having a bad day, don’t pour out your stress and anger on the staff. Instead, try to recharge yourself by appreciating the achievements of your team and setting the next goals.
  • Try not to overload your team with work. Every company has rush periods when it’s okay to have more work than usual. But remember that people cannot work under prolonged pressure and stress.
  • Don’t be selfish – it can be very demotivating to see that the manager only focuses on what you can do for him and doesn’t care about your goals and well-being.​ As the CEO of Xerox Anne M. Mulcahy put it,[8]

    “Employees who believe that management is concerned about them as a whole person — not just an employee — are more productive, more satisfied, more fulfilled.”

Whenever you are having doubts about your kind attitude, remember – satisfied employees are productive employees which lead to satisfied customers and eventually – success for your company.

6. Offer Flexible Work Hours

The traditional Monday to Friday, 9 to 5 job is beginning to slip away. Increasingly more people are working remotely or having flexible work hours, and we can expect this trend to continue. To adapt to these changing habits and remain competitive in the labor market, more employers are offering the chance to choose your own work hours, work from home or even from another city or country.

Offering flexible hours is a powerful way to inspire your existing staff and give them intrinsic motivation. Why not let your employees choose their preferred working hours while keeping the 8-hour day? For example, night owls are unhappy and unproductive if they have to come to work before 10 AM, while others might prefer to start at 7 and finish earlier.

You can go even farther and hire remote workers – this way you’ll be able to recruit from a global talent pool and even save money on office expenses like desks, stationery, electricity, etc.[9]

7. Track Your Team’s Productive Time

Not monitoring your employees’ progress and efficiency can result in poor performance and slacking. Instead of letting things go with the flow, you should consider installing time-tracking software on your employees’ computers and see who’s doing great and who might need a productivity boost.

But don’t get it wrong – there’s no need to become big brother and watch every step your employees take. If you use the time-tracker as a spying tool, you will only see increasing suspicion and insecurity around you, and your employees’ happiness levels will drop.

On the contrary, choose software that allows employees to mark private time that won’t be tracked. In addition, consider these time-management tactics:

Advertising

  • Allow flexible work hours. (see Tip No 6)
  • Encourage breaks – studies show that employees who take regular breaks are more productive than those who don’t.[10]
  • Enable remote work to show your employees that you trust them and that they can work from home or even from another country (if they can maintain sufficient productivity).
  • Consider offering bonuses to your most productive employees (those who show productivity levels above 90 or 95%).

8. Use Only Constructive Criticism

Constructive criticism means offering valid and rational opinions about the work of others, involving both positive comments and remarks about what should be improved. Constructive criticism is usually expressed in a friendly manner rather than an oppositional one.

When you evaluate your team’s work, give them feedback that’s helpful, specific, and sincere. Don’t be shy to praise, but also be direct and even strict when necessary.

9. Don’t Give Special Treatment to Yourself

The boss’s actions are – directly or indirectly – observed by your team. This means that your employees look up to you and often mimic your attitude towards your work and the company – especially if your actions don’t show commitment. Nobody wants to work for a leader who doesn’t go all in or inspire motivation.

What you should do is lead by example. If you expect your employees to arrive at work on time and work 8 hours, do the same yourself. If you want them to show initiative, show it yourself and encourage others to do the same.

Jeff Weiner is the CEO of LinkedIn – a company of 3,000 employees that consistently ranks as one of the best workplaces with a 92 percent employee-approval rating.[11] Weiner’s workdays are reported to be equally long or even longer than those of his employees, allowing him to stay “extremely credible as a leader.”

10. Empower Your Employees

Here’s a common mistake many managers make:

They don’t motivate their staff and assume they simply love to work for their company.​ Such belief can result in painful losses for the company – especially these days when many companies are in desperate need of a reliable workforce.

Instead of directly thinking about bonuses and perks, consider intrinsic motivation. For example, enable flat organization in your team and listen to your employees’ ideas when they come up with opinions and suggestions. Your company might actually benefit a great deal from the feedback, and the unique ideas employees come up with.

You can also start an initiative where employees can freely share or pitch their business ideas to you or the founders of the company. If the idea is accepted by the management, the project can be developed, and the employee can have equity options.

Advertising

If people feel they have an impact in the company, they become more motivated, engaged and interested in the company’s growth.

11. Nurture Your Company Culture

Company culture is the personality of a company that defines the overall work environment and relationships between teammates. It also includes company mission, values, ethics, and goals.

Some examples of company cultures are the Horizontal corporate culture (collaborative and equal; popular among startups and free-spirited businesses) and Conventional corporate culture (a more risk-averse and hierarchy-based approach common in traditional companies).

However, you don’t have to stick to pre-existing boxes when creating your corporate culture. You might think of your team as a family, a sports team, or even a hippie camp if it fits your business and purpose. But keep in mind that by the time a company’s size reaches 20 employees, the company culture is set,[12] and any changes will need to be implemented in smaller teams.

Whichever personality you choose for your company, make sure to live by it and nurture it. Some things that might help:

Team building events, relevant books in your office library and proper on-boarding for the new employees to get everyone on the same page from the very beginning.

Be a Leader, Not a Boss

Using the words of Printful’s CEO Davis Siksnans, the ultimate goal is to “Hire great people who don’t have to be managed.”

However, when you do need to demonstrate some initiative and control, act as a leader rather than as a boss.

In other words, don’t be afraid to show the personality behind your role. And keep these 11 tips close to your heart.

Featured photo credit: rawpixel via unsplash.com

Reference

Read Next