 From time to time people asked me a lot of business questions about my business Which I'm always more than happy to talk about here on the YouTube channel And it's often why I make a video rather than simply reply because if you're applied to one person and the next person had the same Questions well, I like to share with the class here now a little bit of background if you first time here at this channel I have owned my IT services company since I left the corporate world in 2003. I did not go to college I have an entire video about that where I talk about well, they're not you should go to college And I think education is supremely important if you don't feel like watching it That's kind of the the gist of it whether you go to college or self-study Education is the key in my opinion to a lot of success So I'm here answering some of these questions that I was sent And I thought they were questions that not only have an interest in the person who sent them to me But a lot of other people may be interested as well if you're in the process of starting a business You own a business. These are these are good questions about business This is well thought out So I'm gonna quickly run through and answer some of these questions to as best as I can first question What sales tactics work for you when you first got out there? That's a harder one answer and the reason for that is I started in 2003. So in 2003 Much different than 2018 But one thing is still the same and one thing's really important for the B2B side of the business Which is going to be relationship building with other companies being out there and friendly. It's not easy at all I'm not I'm more of an introverted person But I've learned is back when I worked in corporate before my business to be more extroverted to connect with people It's still not easy at all for me It's not my my default position is generally behind a keyboard talking to people online not in person So different of things I joined like the Chamber of Commerce and going to business events and But first off and I've talked about this maybe throughout my videos here and there don't talk tech Talk about a solution you can provide and how it may help their business that takes a lot more thought on your part But that's how you can get a sale So that beat it for the B2B side that helped a lot for the retail side of my business Now it's Facebook advertising when we do it It's kind of hit and miss where you don't really push retail store, but it's been around for a long time We have over 6,500 clients in there somewhere around there And so it just kind of a lot of people know us so we really don't advertise as much for the retail But we still do to an extent it still leads us to a lot of business sales, but the being personal for the B2B side To what was the hardest part in the beginning aside from initial startup? Not knowing what you're supposed to do would happen develop all that structure is probably a little bit difficult I mean granted you're like hey, I made some money with the project I could sleep in on Thursday or Friday or whatever day because you're feel caught up I never feel that way because I'm highly driven and I wake up at 5 a.m. Every morning even on vacation because I'm just I'm hyper. I don't sleep a lot I am like motivated to the next project a lot. So not necessarily motivated to money That's different than motivated next project. So it was not as hard in that aspect I know a lot of other business or struggle with what do I do now? I feel like I should be doing something if you feel you shoot something cold calling and marketing That's probably something so always find something for yourself to do that keeps you motivated keeps you going So that's the initial startup another thing about just in general initial startup And I had thought about this and plan this and maybe you should too you got a plan on not making money for a while Depending on type of business you're starting with IT you're gonna have to spend a lot of money on your personal expenses I had a wife and kids so I had saved up packed away money and Put money aside so even though there wasn't a whole ton of projects at the beginning which we got lucky and got some good ones It was you know, you make sure you have some reserve in the bank I don't live check-to-check because you're gonna have a hard time because if someone doesn't pay or some little hiccup in the Beginning you find yourself in a very desperate situation You don't want to be there. Has work life balance leveled off to a point that you can take time off kind of? I Always could but don't want to I guess would probably be the better Description like I said about me being highly focused motivated work on that project. This is a passion for what I love doing So time off feels like time away from what I love versus on people like oh I just can't wait to sit somewhere on a beach or something. I mean I time off is important tech burnouts a real thing So time off is important. I have taken my family places. I have certainly over the years taken Trips and things like that. I just went to Washington with the kids. I like historic things You know, I did that a couple weeks ago. So yeah, absolutely a matter of fact right now. I just got back from Sambar dunes in northern, Michigan. I just spent the weekend up there So yeah, I can take vacation. I could take time off in a business That's that's an important goal to work towards from the beginning Which is systemizing everything because if the business completely relies on you and I see so many business owners They want to be the center of the world of the business. I do not Therefore they never it limits your growth It makes it very stressful because there's no way for you to take time off because the entire system revolves around you I came from a corporate world where we specifically trained each manager to Have controlled with their department so and everything didn't roll uphill only the exceptions managing back exceptions So that's that same thought process when I started my business was in place of putting systems in place that people could follow And only when something occurred that just didn't fit the system would they Roll it up to me to which you think okay, how could I modify the system so they don't so you want to make the business and be building It from the beginning to work without you. How did you figure out how to price your services? Was there a metric you set up or did you just bill by time? That's a tricky one and still is right now Still a question I think almost every business owners has is you want to keep adjusting your prices adjusting the service you offer You're gonna probably do the best I'm not gonna see margin but you're gonna do really well when you can come up with a fixed price for things because No one likes to say well, it's this much an hour and I don't know how long it's gonna take That doesn't sell well for businesses because they want predictable costs. You want a predictable income now That's gonna take some guesswork on your part. How long does it take me to set up a firewall? These are really relevant questions. I know exactly how long it takes me to set this up How long does it take you to set this up is what you have to determine? So I set fixed prices to set these things up and get these things going Or when it's Nebulous as I call it just kind of I need work done But I can't define the scope then I have to charge by hour because you're just setting the time of I want your time Well, my time is very expensive So you got to set that very high if you say can you set up a VPN? Well, that's like a walk in a park for me So yeah, I can set up a VPN on that firewall and I can give you a lower price And this is how you can negotiate with your clients as well You can quote those services because if there's things you are skilled in are good at then great You can move right along and do it But if they're not you have to kind of work on those the same your prices also look at your Market and what that market is charging that's call the competition oddly enough it works it's this is a Thing that a lot of people don't stop and think about I think one of the funniest little anecdotes I heard about this was at a convention It was for a pool services company friend was talking about this and they said everyone Do you publish your prices and you do it to hide it from your competition? Everyone in the room raises your hands. Oh, yeah We don't publish our prices to hide it from the competition And then the next question of course is how many of you know your competitors prices and pretty much the entire room raise your hand again I a lot of what we we publish what we can The only reason we don't always put everything in a website is because we've had people Because we've raised prices over the years and they find some old copy because it got copied in is somewhere that set our rate Was this like sales specials things like that so we don't publish as much on the web anymore But it's not a big deal if you do Published on is where you tell people check the current we've had people bring pretty copies of like a special that had an expiration date but Yeah, whatever that's mostly for the retail for that for the business side It's hard to publish prices because it's a custom solution frequently So it's not like there's a fixed price in you know, this is how much it is all the time unless it's something You know commoditized like just setting up a vpn, but then comes into how many locations do you have how many workstations do you have? So pricing still always a challenge always be thinking about it always make sure you're making good margin on it There's my tips for it What were the significant external roadblock bumps that you had to overcome? to get where you are today Hiring people's always hard a lot of people ask how do I hire my first person? That was a little bit maybe less difficult for me But that's because of that process. I talked about I've always had processes in place And once you have a process in place, you can fit a person to that process Now banking on saving up money and things like that are important because I have to make payroll every friday That's when our payday is here So I always make sure there's plenty of money in a bank and I have had to do that for a long time But because I came from a systems oriented background of process procedure when I worked in corporate That's that was important But having someone to handle that payroll as in an HR slash accounting company that I externally have doing all of The paperwork stuff because understanding a lot of the paperwork can be a very difficult and challenge And I recommend having an accountant for that making sure you're filing all the proper government paperwork for whichever jurisdiction you're in Here in the usa there's federal taxes state taxes and a bunch of other little bs Stuff that has to be paid I say bs stuff because it just aggravates you when you're looking at all of it I'm like I'm here how much is it and I'll just write one big check and not think about the details It's good to chat with your accountant. But yeah So one roadblock definitely it's worth the money to have an accountant The other roadblock is just finding the right people. It's still a very very difficult challenge I've gone through people they aren't all the same people that when I started I've had some here since I started But others are not I rotated them in and out and fired people you have to know when to do that It's business not personally. You've probably heard that phrase Just before they kill someone but it's also something to think about when you fire someone never killed anyone But I have fired a few people over the years You have to be hyper vigilant about things like that if they are not aligned with your values Or they screw around or just aren't good for the customer and aren't a good experience to fire them It may be a little bit tough. You may personally like them such in a small business It's only a few of us. I can't just delegate it out a few steps going Hey when that person comes in fire them. It's me firing them. So that's still a challenge. Uh, It happens same with hiring. It's like the same thing. You got to bring them in and roll them into your trust system And hopefully they're not going to screw you over. Is your business scalable or have you ever thought about that? I apologize this one. I'm not trying to come off as an asshole. I just didn't know how to ask Scalability is a really good question It if you're looking for the ultimate scalable business is going to build to a billion dollars. Don't start this one Not in it services business services companies in general are really hard to scale. I've thought about franchising I've actually went through the golden sacks small business program I've talked about that before on my channel. You can look it up It's called the golden sacks 10,000 small businesses and I worked with a team of people there We even looked at all the challenges of scaling this business and there's just a lot of roadblocks Every it guy I know used to work for another it guy and they broke off from them and started their own So they thought they could do it better. That is just how this industry works. So there's not a lot of value I maybe I'm wrong and but the conclusion I've really come to it's hard to really provide a lot of structure and value Now I have thought about taking the structure We've created and selling it but selling it on a franchise model is really hard because at some point they go Oh, you signed up with all the same tools. I could sign up with why should I give you a few percent? Because so much of it's b2b meeting the person that Being part of a larger conglomerate doesn't necessarily sell it And then me taking a percentage off the type means you're going to give me that part of your margin And you're going to go what value am I getting for that margin now When you look at some of the restaurant businesses where they commoditize everything down like the McDonald's franchise model And everything's become a very simple kit and they just need some people to help manage and run the business That's different. It's easy. It's very it's the same burger everywhere across America It very custom solution requires a high amount of skill and talent It's hard to commoditize it down so I can find a minimum wage person to fix it It doesn't work as well like that. So it doesn't seem to fit the franchise model as well It doesn't mean I even thought about putting together like a playbook or a business kit like hey Here's how you get started. I'm actually thinking about some of those ideas so I can help people out You know choosing all the software and stack that goes into it But the reality is it's not a secret you can go to a lot of places And I these questions pop up all the time. Which software should I use for rmm? I want to get in the msp which antivirus platforms should I settle on? There's a lot of good ones out there We settle on the so you don't have to go digging. We sell on the whole solar winds platform We're really happy with it. It works. We use our backup there rmm tool We have a wiki for our internal documentation connectivize control for remote management and invoice dinges How we do our invoicing and kmy money is my ledger software. So that's kind of the quick rundown of that What would you have done differently? Ah, this is a tough one. What would I done differently? It's hard because it's I don't like just daydreaming about regrets I mean, obviously, I'm like there's a few people. I shouldn't have hired Uh, maybe there was a few jobs. I probably should have said yes to because they were worth some money But I was nervous about taking them on. Um, I'm I've grown my business very cautiously so because of that the Um, I was maybe not as risk taker But I also The risk weighed out against the business Maybe I could have made more money, but I don't know you can't really play that out because what if it went wrong? I've seen some of the deals that I passed on go wrong for others and that's That sucks, uh, because they can put you out of business I've watched someone go out of business from going with the company It was doing four million dollars a year a great sales team and everything else They made a few mistakes did a few things and whammo they went bankrupt. Um, it doesn't take much sometimes You know just because you see the the big numbers like hey, this company's doing this much a year Um, depending how you manage your money and how much uh income you keep in the bank and you know How much you keep on your balance sheet you could be just a few screwed up large shops away from going out of business Um, it really doesn't take much my a lot of my friends lost their businesses around that 2009 year They were in the home building style of business And yeah that they just the company of their bankruptcy. They're like, but you owe me 300 000 dollars You're like, yeah, uh, talk to the bankruptcy court. You're gonna get pennies on a dollar on that They knew they were taking a big risk doing so much work with one company and you have to think about that So those are I don't know what would I done differently? Maybe tried to make some money off those. I don't know. I'm kind of babbling now The one thing I will say is I had a business partner for a little while That was an awful experience choose your business partner like you would choose a marriage partner. Um, but A slight twist on that you never choose a business partner out of love Choose one out of respect because then there's no emotion involved if you respect that person You're you can probably find a business partner you do well with if there's some like Hey, man, this is cool. Let's run a business getter because we're good friends You're probably more likely to have a problem You can look historically through any business partnership and you'll find that people who just are like-minded But not necessarily close best buds. We hang out friends May do better because there's a mutual respect. They have each other and I'm kind of speculating here I had a bad experience with business partner and bezel bunny turned into a mess now I've always owned longer technology since 2003 but from 2004 to 2006 I had another company called suburban electronics, which was a retail venture Um where we did tv and electronics repair The partner was just a mess and so that's definitely if I had to go back and turn that part off I maybe I did learn a lot so But it was a mess What wouldn't you do differently? This is the last question and this one is goes back to a couple things one the accountant and I highly recommend having someone who can navigate all the paperwork and have a trust relationship with where they navigate the paperwork Make sure my taxes are paid. Make sure I'm following whatever rules and because I'm paying them a monthly service fee for those things They also are not a bad person because they're looking at my financials to go. Hey What about this or what about this and they talk about strategy with them? So definitely a good accountant going to put that high up on my list of things That definitely to do read a lot of business books There's I Think I have a list on my thomas lorge.com with some of the podcasts I read. I think I left some business books there I'll run off just a couple off the top of my head Alexis orhanians without their permission was a great book j. Sam it disrupt you lots of ideas in that book Those two pop in my head Screw business as usual by richard branson. I thought that almost kind of had some clever ideas in it Read a lot interact with people a lot. I still try to reach out You'll be surprised if my people want to you know are willing to help you Other businesses willing to help. I don't want to see you fail. Um, I don't that's probably reason I'm even doing any of these videos I hate the mentality of my success means your failure even if you're a competitor in my market That's not exactly how it works That's not There's enough business that more than one computer store more than one it services company can be in my area Because there are there's actually very few in my area, but there are more than one And uh, as long as they're doing things in a up, you know an honest goodness way You know not trying to shister people not trying to Or however, you want to phrase it not trying to screw people over Then great I welcome the competition because if you can just take all my videos and do what I do and do it better than me Awesome, you're better than me. Um, I don't I don't really worry about that. So uh, definitely reaching out and Being peers was in peer groups or anything like that now joining peer groups really hard I've not found a lot of like-minded business people. Uh, that's kind of hard to find There's a few and they're not even in my industry that I kind of be us with From time to time because that does help. So those are the questions Um, I don't mind doing this once in a while. If I get a good list of questions I'll throw them together and uh do some Q&A here. It's hard to do it on typing in Real time because then it becomes as long pauses and things like that I don't mind being asked on vlog Thursday either. That's my off the cuff or I will do things like that But this hopefully was helpful Hopefully offered you some insight if you're thinking about starting an IT services company It's been a fun venture. Like I said, I'm now this is my 15th year in business. I'm enjoying it It's been a good time. Uh, hopefully if you're interested in starting this business You know have at it Think about the risk. Don't bankrupt yourself. Be very honest and Cross your fingers that it all works because in the end the the the hardest part I'm going to tell you right now about this entire thing is luck has a lot to do with it You have to be ready when the luck comes. You have to be getting yourself out there in a place Where luck might happen, you know going to these business events, but you can go to you can be like Tom I went to 100 business events and I got no business Maybe no one was standing there at the right time that needed your services Sometimes we've gotten lucky and landed a large sale. Sometimes we've gone to the business events over and over again And just nothing really comes with it said hi to a couple of people and They used the other guy instead of me and that happens. You have to accept that so That's kind of luck of the draw. It's a it's the worst part about It that you rattle what you did wrong, but don't beat yourself over just go to the next one Don't get discouraged. 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