Saturday, April 25, 2009

Wearing My “Manager Hat”

I went into business for myself because I wanted to write and be my own boss. It was a long-time dream; the timing was right; and I was sooo ready. So, I took the plunge, having absolutely no idea what I was doing. That was a mistake. If I had it to do over again, I would know what I was doing before I found myself doing it.

Here are some of things I didn’t know:
  • For every dollar that came in I had to put aside a certain percentage of for taxes. My accountant told me the amount could range from 30 to 50 percent, depending on my tax bracket. That meant for every three dollars I earned, I could spend two or possibly only one and a half. Those taxes had to be sent to the IRS every quarter before the fifteenth of the appropriate month.
  • I already knew I was supposed to keep track of every expense, but I had no system for doing that. I either needed to create such a system or have my accountant do it. For years, I paid my accountant the extra money to do bookkeeping I could easily have done myself, if I had bothered to learn how.
  • There was also, of course, the matter of tracking the time I spent on each client’s job and being sure I charged the correct amount. That meant deciding on an hourly rate, making sure the client knew what it was and agreed to pay it, buying and learning to use a time and billing program, and remembering to send invoices regularly and follow up when they weren’t paid. Every item on that list was its own individual nightmare.
  • Then there were contracts, which I had no idea how to negotiate, write, or enforce. Consequently, there were holes in my contracts big enough to drive a jeep through. As for enforcing them — well, that was a joke. I tried Small Claims Court a few times before I found out it was an even bigger joke. (See Small Claims Court Revisited)
  • Finally, there was the whole matter of determining whether or not I was making a profit and, if so, how much. To this day, I have no idea how to calculate that, so I never have.
The bottom line is this: I “went into business,” if you could call it that, like a kindergartner enrolling in college. I didn’t ask the right questions because I had no idea what questions to ask. I learned every lesson the hard way, often the very hard way. Some lessons I did not learn at all because, once again, I didn’t know there were lessons. Don’t ask me how; but, somehow, I have survived for 20 years. Much as I love what I do, though, managing the business has always been the toughest part for me.

What would I do differently if I could start over? In terms of wearing my manager’s hat, just about everything. The very first thing I would do is sign up for a small business course at the community college or one of the local universities. There are many such courses available, and I should have taken at least one. Learning to manage a one-person business is not like learning quantum physics. It doesn’t have to be the very hard way. It doesn’t have to be a mysterious or frightening. From what I hear, it could actually be challenging, growth promoting, profitable, and fun.

I have a little trouble with the fun part, but it’s possible, I guess.


Kim said...

St. Louis Community College has a wonderful Women Entrepreneur class that I took many years ago. Each week covered an essential topic, such as business plans, bookkeeping, marketing, finances, getting organized, etc. Plus it was great fun to be with a bunch of creative women.