As a business coach, you can imagine people come to me doing more things wrong than right – otherwise, they wouldn’t be seeking my advice. So I see a LOT of mistakes. But the reason I am able to spot them and give good advice on how to fix them is because I made every single one of them myself. And even though it feels like I see a lot of mistakes, they all boil down to a small list.
So go ahead and read this list because I can almost guarantee you are making at least one of these mistakes. Take comfort in the fact that you are far from alone and make effort this week to fix it.
1. Working on business that isn’t profitable.
If you are still taking bookings where you make less than $500 commission, you are shooting yourself in the foot. It’s time to draw boundaries for you and your business.
How to fix it:
Establish a specialty and learn to say “no” to business. I think picking a specialty is one of the most difficult steps forward in this business. On the one hand, your $200 commission bookings are better than nothing, right? WRONG. When you establish the correct specialty, you will own your gifts and talents and target travel clients who are spending more on their travel. Let the online booking engines have the $200 commissions. It takes courage and trust to step into your unique specialty and market it, but I KNOW the rewards are worth it.
2. Treating your business like a hobby.
Treating your business like a hobby means failing to do the things necessary to take yourself seriously so that clients will too. Mistake #1, listed above, is part of this. But there is more. Here are some signs you are treating your business like a hobby:
a. You have an email address that ends with @gmail.com, or @comcast.net, or @windstream.com (or any other free email service provider);
b. You have not incorporated, or at least created an LLC;
c. You do not have a separate bank account for your business;
d. You don’t pay yourself salary (if you’ve been in business for more than 2 years);
e. You don’t have a separate phone number for business;
f. You see your business as a part of your host agency, so you don’t have a separate website and have not established a different name;
g. You have no marketing activities you do on a REGULAR, CONSISTENT basis.
How to fix it:
Turn around and DO all the things in the list above. Go purchase a domain with your business name or your personal name and get a new email address with THAT domain. For example, I can jump on to www.godaddy.com and purchase the URL, www.meredithhill.com and when I am checking out to pay the $10 for this domain, I can add email addresses to this domain for a few dollars more. Go do that.
By all means, please incorporate or set up an LLC so that you legally separate your business from your personal. You don’t need to spend hundreds of dollars on legal fees. Just go to www.legalzoom.com and they will simplify the process for you.
Once you have a separate legal identity for your business, you can then open a separate bank account. And when you have found the courage to step into your specialty, in just a short time, you will find you need a place to put all those big commissions you are now earning.
Then, to follow IRS standards, pay yourself a regular salary – this is a frightening, yet profoundly empowering move. It took me a LONG time to do this. But once you do, you realize how it makes you act different – you make different decisions in your business because you are always thinking about how you will be able to pay your salary next month. It really puts a fuel under the fire.
It’s also time to realize that your host agency is NOT your employer, IF you are an independent contractor. And if so, you must act like a business owner – get a different name, market yourself and your business separately.
Finally, PLEASE do me a favor and commit to doing 1 single marketing activity on a regular and consistent basis. My favorite is the electronic newsletter, but if you want to choose something else, that’s fine. Just commit to it and do it.
3. Ignoring Your Numbers.
Even though we are in this business to make money, many people unconsciously sabotage their ability to do this. And ignoring your numbers is a popular one. What does ignoring your numbers look like?
a. Having no financial goals
b. No budget
c. Not knowing and tracking your average commission per booking
d. Not tracking your financial performance on a monthly basis
How to fix it:
Get in the habit of doing all 4 of these things listed above. Set a financial goal for this year. Just pick a number that feels good to you and shoot for it. Create a budget. Start with last year’s numbers and guestimate what you will make and spend this year. Calculate your average commission per booking and start tracking this number monthly. Every time you make a new booking compare the commission to your average and make a point at trying to raise the average by beating the average each time. Hint: this will help you learn when to say no to business. Look at your financial performance each and every month – no matter how much you don’t want to look. Trust me, I understand how hard it can be to look at your financial numbers. I avoided them for years! But what I learned is that once I looked at them, I had power. I had no power when I didn’t know. The power is in surrendering to where you are and establishing a goal of where you want to be.
Go through each and every one of these business mistakes and make a point of correcting your mistakes before this year is over.