Archive for March, 2008

Dear Danielle: Do I Need to Charge Sales Tax on My Services?

Dear Danielle:

Do I need to charge sales tax on my services? –AM

This is a tax and legal question, not a question for your colleagues.

When it comes to tax and legal questions, you need to talk to the proper professionals.

No matter how well intentioned or experienced, your colleagues’ advice may or many not be accurate, especially since the laws and requirements in every country, state and locality are going to vary and not necessarily be the same as those where you operate.

Your reliance on inaccurate information could then put you in noncompliance and cause you problems, maybe even get you into hot water.

What you want to do instead is ask the appropriate governing agencies in your state and locality.

That might be your state’s Department of Revenue (or equivalent) and your city or county tax and licensing departments.

Whatever those agencies are, they will be the place to get the most accurate information on the matter.

Are You the Right Person to Be Designing Your Website?

There is always ongoing discussion about the best platform to use for our business websites: custom CSS/HTML, WordPress, subscription service (e.g., Wix, Squarespace), and so on.

One common denominator in these conversations is that the emphasis always seems to be on the do-it-yourself mentality.

And there always seems to be one important question left out of the equation: Are you the best person to be building your business website?

We in the administrative support business preach this business principle all the time to clients:

  • Are you the best person to be doing that work?
  • Is it the best use of your business time and energy as the business owner?
  • Do you have the knowledge and skills to do a good job of it?
  • If you are spending your time there, what more important business activities are being neglected, and how is that impacting your forward business growth?

And yet many in our industry don’t practice what they preach.

An administrative support business is no different than any other small business. Administrative Consultants can be more successful if they grow their businesses in the same ways that we advise our clients to grow: By letting go of doing everything yourself, getting the right help and expertise, and saving yourself a whole ton of wasted time and energy.

The mantra in marketing circles is: When the product is invisible, the package IS the product.

What that means is when you offer an intangible product such as professional services, how you package that product is absolutely vital to how your business is portrayed and perceived by your market.

Clients don’t know how to tell a good administrative consultant apart from one who is not so good. They rely on other subtle clues and cues to help them differentiate.

One way they do that is through the visual presentation of your website. They directly correlate the look and feel of your website with your level of skill and competence — you need to make the right impression if you want them to choose you.

So the question becomes: Are you the best person to be designing the product packaging for your business?

First, most people are not designers.

I hate to break it to you, but just because you own Photoshop or Dreamweaver, that doesn’t make you a designer.

Just because you can do a thing, doesn’t mean you are any good at it or that it’s a good use your business time as the CEO of your business.

New business owners often get so caught up in playing with their new site software toys and tools (because it is fun), they lose sight of the fact that they might not have the marketing understanding and knowledge of design principles to give their business the best possible “packaging.”

Another thing to consider is the idea that when it comes to our own work and our own businesses, we can be too close to it to see clearly and through the same eyes as our intended market.

Your website, after all, is not for you, it’s for your target market and would-be clients, and it needs to designed with them in mind: their needs, their tastes, their interests, their viewing habits…

And, through all this, when you are spending weeks, months even, dinking and fumbling around with your website, what more important business-building work is that distracting you from? Where could your time be better and more smartly spent?

Not that you shouldn’t be involved in the design of your website — of course, you should. And I get that most people in our industry start their businesses without being properly funded, so they bootstrap and have to make do with what is available to them at the moment.

That said, when it becomes financially possible for you, I urge you to have your website professionally designed or overhauled by a real, skilled designer.

Indeed, do everything to MAKE it financially possible.

Your business website is THE most important and central marketing and client-getting tool in your business toolkit.

Professional web design, therefore, is one of the first, most worthwhile investments you should make where you’ll see an immediate results in getting clients.

Your business will look better, allowing you to attract a better clientele.

It will also make you stand out from the sea of generic, templated and unprofessional, amateur-looking sites.

And you can focus your time and energy on the more important work of networking and business development.

Grateful for Client Who Pay on Time

“Payday” is coming up for me on the 25th and I am reminded how grateful I am for wonderful clients who pay on time.

I am super-picky about who I work with.

Long experience and tough lessons learned (I’ve been in this business since 1997) have taught me that I absolutely can not afford to work with anyone who is a drain on my time, my energy or my spirit.

After years of refining and streamlining my business and gaining more and more clarity about who I work with best, who I like working with, and who is profitable for me to work with, I now have a client roster of wonderful folks who appreciate my work and are a pleasure to work with.

One of the benefits of those relationships is that I am never paid late. Part of that has to do with the standards and policies I’ve put in place in my business.

I work on monthly retainer where clients pay in advance for a monthly plan of administrative support customized for them. And I have all of my retainer clients on auto-pay so all I have to do is run their credit cards on the 25th of each month and I’m paid.

No late payments. No waiting around for checks. No chasing after my money and forgetful clients.

It’s a convenience for my clients as well and eliminates one less step they have to keep track of.

The other part is simply that I work with people who value our relationship and what my work brings to them and their business.

I am so grateful to all of my clients, who honor me with their business and confidence!

Thanks, But No Thanks

I was recently contacted by someone new to the industry to contribute to a book of tips they are compiling for people who are interested in starting an administrative support business.

They informed me that one of the benefits is that I’ll get to put the fact that I was quoted in a book on my resume, and it will help document my expertise.

I then learn that they have been sending this blanket message out to all the members listed in our directory.

On top of this, it turns out they aren’t running an administrative support business at all, but rather a virtual staffing agency. Not the same thing whatsoever.

To put all this in perspective:

  1. They are a private, for-profit business;
  2. They are indiscriminately spamming anyone and everyone;
  3. They want us to write their book for them to benefit their business;
  4. They think we are employees who submit resumes to clients;
  5. They are a virtual staffing agency, not an Administrative Consultant.

Brother.

What this industry doesn’t need is yet another for-profit book from people who just hung out their shingle and especially not from folks who don’t know themselves that we are not employees and we don’t send out resumes.

Indiscriminately spamming people with for-profit intentions is not a good way to introduce yourself into the community. It certainly has generated quite a bit of ill will among my members.

It’s also not a great way to establish business relationships.

A better idea would be to do a bit more homework first to gain some understanding about who you are contacting and make sure your contact is appropriate.

Like in this case, if this person had done any research, they would know that virtual staffing is not the same thing as Administrative Consulting and that I would probably not be an appropriate person to contact because I am a huge proponent of bringing improved clarity and understanding to the marketplace about the different types of administrative service businesses out there.

I am not interested in the least in contributing to any effort that only causes more confusion and misinformation in the marketplace for everyone involved.

On the Topic of Low Rates

Why is it that whenever the subject of low rates comes up (i.e., people charging rates that could not be remotely profitable, especially for what they are delivering to clients), there are always several people who bring up the words judgment and competition?

The idea of competition is such a pedestrian notion to me. It’s non-existent in my world. I don’t compete with anyone but myself.

It’s never had anything to do whatsoever with who was attracted to me and my services or how I obtained clients. And regardless of what anyone else thinks, it has nothing to do with how you attract and obtain clients either.

A lot of what you hear in these conversations are excuses and rationalizing.

And that’s too bad, because those who don’t charge profitably are being deprived of an opportunity to learn how they could do better in their businesses.

Instead, they are actually encouraged to continue being mediocre and operate in ignorance and poor understanding of business principles instead of being empowered to become more knowledgeable in business and gain more confidence in themselves and what they offer.

When people don’t charge properly, they rob their business of being financially solvent and profitable.

Undercharging also attracts the least desirable clients, who make the business so much harder and less pleasant to run.

Low prices also train clients to devalue you and expect something for nothing.

If people could get over this ridiculous idea that the topic has anything to do with competition, we could instead have more meaningful conversations that might actually help folks learn more about running their business better.

I guarantee you, nearly every single person undercharging has not done any business planning whatsoever.

With proper business planning, they would see how short their rates fall in building a self-sustaining, profitable business.

They would begin to see that they don’t have to work with everyone, only the people and markets that are the best fit. And that they could actually make more money doing so.

Granted, most new business owners are unsure of themselves, and lack confidence, which is a large part of the issue.

Lots have absolutely no business training or experience whatsoever.

But with knowledge comes power, and as they grow in their business smarts and begin to work more with clients who value what they offer and are willing to pay for it, their confidence grows as well.

These things grow in stages; it’s always a journey.

But we can’t help people in their journey when conversations are effectively shut down by tedious, ignorant attitudes and those who don’t have the fortitude to say something different.

Dear Danielle: What Is Your Backup Plan?

Dear Danielle:

There’s a discussion happening on a coaching listserv where some coaches are wondering what our “backup plan” is as someone who runs an administrative support business. How do you respond to this? –SA

Well, at the root of this is some miseducation of the marketplace. This is the kind of question that usually comes from a client who thinks he or she is hiring an employee.

First, it’s really important to educate clients that when they engage you, they are working with a service provider—a business–and not an employee.

The service we provide (ongoing administrative support) is an alternative to employees; not the same thing as employees. That means, there are necessarily gonig to be some differences in how and when you work together.

One way to avoid this confusion altogether is by not calling yourself an assistant. Because people only understand that word one way: employee.

Assistant is a term of employment that should have no place in your business vocabulary. Simple as that.

Now, when it comes to backup plans, I would say this:

A backup plan is a good thing to have for your business.

That means, having some kind of risk management plan in place to mitigate issues and other unforeseen events and catastrophes that arise from seriously interrupting or interfering with your ability to conduct your business and assist clients–and make money.

You might also want to formalize your vacation and minor emergency (such as illness) policies, as well as what happens if you are unable to fulfill any contractual obligations (e.g., partial refunds) and add that information to your client guide.

That way, when you consult with clients, you can let them know right from the beginning that you periodically take vacations or that you try to give XX days advance notice; and that in the event of minor emergencies, you might be “closed” on occasion.

Those are just simple client-friendly policies and courtesies to have, and lets them know what to expect.

All that said, it’s very important that you understand the distinction between being a smart business owner and knowing what you are (and are not) obligated to provide for clients:  It’s not your job to have a backup plan in place for clients. You aren’t their employee; you’re a service provider to them.

No client’s business should be so dependent upon your services that it can’t run without you.

Their business is never your responsibility; you are each responsible for your own business.

So if they want a backup plan, then they are the ones who need to put that in place in their business, not you (although you might assist a client with that if you so choose).

The colleagues I associate with are honorable and do all they can to fulfill their contractual obligations. If they can’t, I am confident they will do whatever is fair in the situation.

But that’s where your responsibility ends as a business owner.

If for some reason you are unable to provide services to clients for any extended length of time, they have the same recourse all of us has when we deal with any business that has closed or no longer meets our needs–which is to take their business elsewhere.

It Doesn’t Have to Be Done RIGHT Now

It Doesn't Have to Be Done RIGHT Now

I know that sounds obvious, but how often have you found yourself trying to get EVERYTHING done RIGHT NOW?

Did you know that you can actually create a much happier, more profitable and smoother-running business if you embrace this mantra?

Not only does it not have to be done right now, it really shouldn’t be done right now.

What do I mean by that?

Well, operating a solo business is a bit trickier than running other business models.

People who go into solo practice aren’t interested in managing people, and they have no desire for the kind of demands and volume that a larger business model would entail.

They like being the technician slash business owner, and find meaning, purpose, enjoyment and fulfillment in doing the work.

And like an artist, their craft and talent and how they deliver their work and results is unique to them alone.

This means, however, that they must be even more conscious of their business processes and how their resources are expended.

One of the things that becomes really important in a solo business is having the space and mental bandwidth to think and move around in the work in order to produce quality work in a professional manner.

If you continually operate with clients in RIGHT NOW mode, you give away control over that space.

Pretty quickly, clients get used to the “instant assistance” and begin to expect it, all the time, every time. They forget that you have other people to serve besides them. And when they are allowed to have those kind of expectations, they quickly become very unpleasant to work with.

Eventually, you realize you can’t sustain that kind of pace, not without sacrificing your quality of work and service standards along with your sanity, happiness and well-being.

This advice is summed up very neatly by my online buddy and branding expert, Rob Frankel:

“… being too responsive can kill you, because the client begins to expect you to react instantly, even to issues which require more time.”

See how that can create unreasonable and unsustainable expectations in clients, the kind you can’t afford to have in your business?

The solution is to examine your work processes, formalize policies and standards, and set and manage client expectations that give you the space you simply must have in your solo business to maintain quality and prevent burnout and overwhelm.

Here are some questions to get you thinking about this in your own practice:

  • How much breathing room do you need to do great work at a comfortable, humanly sustainable pace?
  • How many days would that be? Next day? Two days? Three days? More?
  • What days/hours of official operation do you want clients to be observant of?

Mind you, this doesn’t mean you still can’t work any time you please, but you don’t want clients calling and chasing you around on the phone at all hours of the day and night. That’s a surefire recipe for boundary issues and resentment.

It’s okay to have parameters. It’s imperative that you do, in fact. You’re a business and it’s healthy and in the best interests of you and your clients alike.