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Ah, content mills. If I have a pet peeve in the freelance writing world, they would be it. Outside of my own client writing, I also write for other freelance writers. I help new writers get started without falling into the ruts of extremely low pay. I try to help them get past the misconceptions about Web writing specifically. And the issue of content mills often comes up.

The simple truth is this: any writer worth their salt can earn more with private clients or by developing their own income streams than they can with mills. Content mills are never the best option for these folks who are looking for more than some quick cash as a hobby writer. If you’re making a career out of it, you can do better.

Still, I constantly see writers trying to justify mill work saying that they can “easily” earn $40k or so per year there which is better than what they might have been making at a full-time job. Here’s the thing. It’s not usually better. What they forget is that $40k per year as an employee is a very different thing than earning $40k as a freelancer (what you are when you write for content mills). They are not directly comparable. Yet these numbers are thrown out there even by the mills themselves to try to suck in new content producers. And it works.

As a former writer and editor for mills (someone who was basically paid to use this information to pull in new writers), I know how the marketing game works there. I’ve also covered some of the lies content mills tell and more about my background with them rather extensively in the past, so I won’t rehash that all here.

Today I want to take a look at two different types of content mill revenue schemes you might come across, and how the numbers really break down before you get too excited about what you’re told will be a great gig. Let’s start with some basics though.

Writers: Would you rather be indespensable or replaceable? - Credit: BigStockPhoto.com

What are Content Mills?

If you’re new to the idea of content mills, it might be a bit confusing at first. They’re known by several different names — content mills, content farms, content networks, etc. — and people often disagree about which sites should be classified as such.

For the purpose of this article we’ll say content mills are any sites that hire a massive number of freelance content producers to publish articles with the intentof driving search and social media traffic to convert it into ad revenue. Some examples include Demand Studios, Suite101, and Associated Content, although there are certainly more.

Types of Content Mill Revenue Models for Writers

We’re going to take a look at two common revenue models for content mill writers — up front payments and residual earnings. Up front payments are self-explanatory. The writer is paid a set dollar amount per article they write. To get up front payments, they might have to sell full rights to their work to the mill.

Residual earnings work differently. There is generally no up front payment at all. Instead writers are paid either based on pageviews their articles receive or based on a percentage of total ad revenue earned through their articles (although the exact percentage generally isn’t shared with the writers).

I mentioned $40k per year as an earning level I’ve seen writers tout as fantastic for mill work before. Looking at the average salary of a starting Web writer in the U.S. (based on data from Salary.com), it’s not that far off. The average salary is $47,492.

Already these content mill writers aren’t earning beginner level wages in their field, and those $40k earners are not the majority. If we’re talking about hobby writers who just want to earn more than they could at the local fast food joint or something, I can’t fault them in any way. But we’re often talking about professional writers, sometimes with extensive experience and advanced degrees, who are looking to mills as a long-term full-time career option. In their case there’s little excuse to be earning less than salaried beginners in their field. And those are the writers who can do much better if they want to (and if they don’t want to, that’s fine and it’s completely on them).

Here’s the kicker though. Even if someone could earn $47k with a content mill consistently year after year (and mills have been known to close, be sold off, and completely overhaul their revenue share models seemingly on a whim), they still wouldn’t be earning as much as a starting salaried writer doing similar work. That’s because of what I mentioned earlier; freelance and salaried yearly earnings aren’t directly comparable.

When you talk about a $47k salary for an employee, it involves much more than that base salary. It includes paid time off like sick time and vacation time, a portion of Social Security and Medicare taxes, usually health insurance (and real health insurance — not the far-from-adequate discount plans some mills use as a marketing tactic), 401k contributions, and other benefits. Freelancers serve the role of both the employer and the employee, and therefore have to account for all of those things in their yearly earnings. Based on that same Salary.com data, a $47k salary for a starting Web writer actually comes to $67k when you factor those things in. That is how much a mill writer would have to earn to keep all things equal and compare their earnings to that of a similar employee position. In other words, if you wanted to leave a $47k per year regular job to freelance full-time as a Web writer, you would need to earn $67k freelancing to earn an equivalent income. And that doesn’t even include business expenses. But for example’s sake we’ll assume those are minimal and stick to $67k.

Earning $67k through freelance writing is absolutely possible. Many writers, including myself, do it without a problem. And it doesn’t involve mill work. But if you could create a sustainable mill writing career earning that equivalent of a beginner Web writer’s salary, what would it actually take? Let’s look at some specific examples.

Forget content mill marketing hype. Crunch the numbers for yourself. It's enlightening. -- Credit: BigStockPhoto.com

Potential Revenue Example: Up Front Payments

I mentioned that Demand Studios is an example of a content mill. Most of the Demand writers I know (and I know many) earn around $15 per article. So how many of these articles would they have to write each year to earn that $67k we talked about earlier?

4467

Yep, you would have to write nearly 4500 articles in a year just to earn the equivalent of a salaried starting Web writer with this mill if you earn what most of their writers seem to earn. There are some who earn more but they’re the exception, and no one should ever expect to be the exception to the rule when it comes to their career.

Okay. So when we break that down into monthly and daily totals, maybe it won’t look so bad, right? Let’s do that.

You would have to write 372 articles per month to make that happen. Assuming you work full-time hours, meaning five days per week, that comes to 19 articles per day. That also assumes no holidays, no sick days, no personal days, and no vacation days. The only way this kind of content writing is truly sustainable as a career option is if you choose to earn far less than you could be earning.

Potential Revenue Example: Residual Earnings

Now let’s look at the residual earnings method. I’ve often seen people get worked up about these models (it’s the model I used to have to recruit writers into before I wised up and got out). It’s easy to take a starry-eyed look at residual earning content mills. After all, you write the article once and you keep getting paid for it month after month after month. The lure is the idea that you can eventually do nothing — just sit back and live off the residual earnings from your old articles.

For the vast majority of writers, that will never happen. For those situations where it does, it generally happens with residual earnings from your own projects and products — not mill writing.

Several months ago one of the contributors on my freelance writing blog wrote up an evaluation of a residual earning model mill. Commenters on these content mill articles often tend to take general comments about the models themselves personally even when they’re not. That post was no exception. We had people commenting saying how fantastic they were and how wrong we were to criticize the model and the writers because they could earn $1000 per month residually.

That’s great. But $1000 per month is nothing to write home about if you’re building a career as opposed to hobby writing or side income, as our readers are trying to do. I always find one thing curious though. When people tout the greatness of content mills and how much they can earn, they very rarely tell you the full truth about the work that goes into it. It’s no wonder new writers see those stories and think they’re inspirational, jumping on board hoping for similar “success.”

For example, when I saw those comments I did some research on the writers. Those two writers in particular had both written more than 1400 articles for the mill in question. Guess how much they’re really earning per article each month if they’re getting $1000 residually? A measly $.71 — not even a dollar. Residual earnings also often don’t come quickly, which means you’re basically writing unpaid for a while (although less than a dollar per article is still practically “unpaid”).

Based on that, how many articles under this model would these folks need to write each year? Well, at $.71 per article per month, that comes to $8.52 per article per year (less than even Demand Studios, which is pitifully low pay for professionals to begin with). That means to earn the equivalent of a starting salaried Web writer they would have to write 7864 articles per year. That comes to 655-656 articles per month, or around 33 articles per day. This example also doesn’t include holidays, sick days, personal days, or vacation time. You would have to work full-time, five days a week every week to make these numbers work out. Otherwise the weekly requirements go up.

You also have to keep something else in mind. Residual earnings are never guaranteed. A hot topic getting traffic and ad revenue today can flop completely tomorrow. Many of the high earning examples you see play upon timely topics (like holidays or something in the news) which only earn well for a month or two and then drop off. That means many of the articles you write for higher residual earnings now won’t actually be earning the same into the future, and you won’t be able to stop writing to live off of residual income that way. You have to keep churning out more content on more timely topics to keep income levels up. Most of the writers claiming they earn very well through residual income models with content mills that I’ve looked into do indeed put focus on these timely topics. You would have to be able to do the same consistently for evergreen topics to make the long-term residual model work.

Myths and Tips about Earning More Without Mills

When you take a look at the reality of the numbers, content mills almost never make sense. It’s simply bad business to try to build a sustainable full-time career with content mills for most writers. But there are a lot of myths floating around out there which discourage people who do want to earn more from working towards it, and they stay with mills as a result. Let’s sum things up by taking a quick look at some of the more common myths about earning more without mills, and the reality of the situations.

Myth: Content mills pay weekly or bi-weekly in some cases, which you’ll never get with private clients.

Fact: When you’re the business owner, you decide your payment terms. Personally I charge up front for my work with private clients, and I have a waiting list of people happy to abide by those terms as soon as I have an opening (which is rare). I do that because I do rarely have openings, and it keeps less serious prospects away. Most professionals I know charge at least a portion up front before starting work, and charge the rest immediately on completion (when it comes to Web writing). You can actually get paid not only more but get paid faster with private clients, especially if you accept payments online via Paypal (which you probably do if you accept mill payments anyway).

Myth: Getting private clients involves a lot of time marketing yourself, which undercuts the real hourly rate you earn.

Fact: Will you spend time marketing yourself? Absolutely, and more in the beginning. But it doesn’t even come close to making content mills a better deal. And here’s a perk for you — when you build visibility and a demand for your services, it doesn’t take long for clients to start finding you instead of you having to find them. Remember that waiting list of mine? That’s how I built it. And it took me just three months when I went full-time with my freelance writing to get to the point where I had a consistently full schedule at much higher rates than mill work ($100-200 for most 400-500 word blog posts for example — at least twice that for features and higher rates for most business writing work, and I’m far from the highest end of the professional pay spectrum). I know plenty of writers who got to a similar position with private clients in an even shorter amount of time. In fact, I recently offered to coach a content mill writer working for Demand Studios to help her get away from mill work. We were able to replace her full monthly average content mill income in just two weeks with private client work, and increased it significantly shortly after. It does not have to take a long time to earn better than what you’re making with content mills. That’s only true if you’re lazy about your marketing or you don’t do the proper targeting, so you market to the wrong prospects.

Myth: Content mills are fantastic because they let people work from home so they can be with their families more.

Fact: What’s far more fantastic is earning what you’re worth as you work from home, making more than content mills pay, and having even more free time to spend with your kids and your spouse or to pursue your own residual earning projects (like selling e-books and reports).

Myth: Private clients are more demanding than content mills so I’ll earn more hourly with mill work.

Fact: Many Web writing clients are actually far less demanding than content mills. In my case for example, I generally choose the article topics I want to write on and the client picks from that list. So I write what I’ll enjoy writing, which will also benefit the client’s website or blog. I also very rarely get edit requests from private clients, whereas I’ve seen numerous absurd edit requests from content mill editors who clearly know nothing about the subject matter. And if you refuse edits even if they would make a piece factually incorrect, you risk not being paid anything at all there. When you work with private clients, you can also dictate how many edits are included in your price structure. For me that’s two sets of edits max. Anything beyond that (such as a client having everyone they know look and give feedback for edits one at a time) is billed as an extra fee. If the client makes any major change to the scope of the project, they not only pay for the time already put in, but they also pay for the new article in full at the normal writing rate. So no, they’re generally not more demanding. Content mills often demand more than what they’re actually justified to based on what they pay, and with private clients if they demand too much you simply invoice for the additional work not included in the original contract. Try invoicing a mill when they pull that.

These are just a few common myths about content mills and writing for private clients. There are certainly more out there, and I have no doubt that mills will continue to pull in new content producers. For some, they’re fine. But for those looking to build serious sustainable careers full-time, there are better options. All you have to do is crunch the numbers and push past a few common misconceptions to see that.

It might still feel like winter outside, but it’s the season to start preparing for summer internships. Businesses both large and small are starting to think about summer internships, and if you’re trying to land a highly-coveted position, now is the time to get started with your application process. But before you do, read our tips on how to navigate the world of summer internships:

What Type of Internship: The first question is whether your college or university requires you to complete an internship in a specific field. For example, if you are a public relations major in college, you may be required to complete a public relations internship in order to qualify for graduation. However, if you’re not bound to any strict requirements, there are dozens upon dozens of options out there once you identify what interests you. Make sure to include this info on your resume!

What Industry? While you may have to apply for more than one internship, it doesn’t mean that you have to apply for every public relations internship out there. Start by narrowing down your industry focus. Do you like fashion, social media or want to work for a non-profit? Find a few areas that interest you and begin your search there.

Talk to Your Advisor: Some, if not most, internships require that you receive college credit as a condition of employment. Even if you don’t need an advisor to register for the internship or to receive credit, speaking to one might still be a good idea. An advisor can tell you what to expect from an internship, how to apply and might have connections with companies you are interested in. It’s an important appointment to make, even for the most independent students.

Prepare Your Cover Letter and Resume: Before you can start applying for summer internships, you have to make sure your internship resume and cover letter are updated and are in working order. Did you remember to add that new club you joined in the fall? Does your cover letter look professional? Make the strongest first impression possible, and if you need help, there are hundreds of websites on the Internet that offer free samples and guides. College career centers also provide assistance.

Get References: A potential employer could very easily want to check your references, so keep the screening process moving by having them handy. Ask your college advisor, perhaps a previous professor or two or boss.

Where to Apply: If you know specific companies you want to work for this summer, try searching their website for career information. If you want to see which companies are advertising summer internship positions, try a job board like Urban Interns that has up-to-date job listings.

Learn and Have Fun: You are taking an internship to learn, so try to apply for positions where you will build tangible skills and credentials. But just because a summer internship is work does not mean you cannot have fun! Finding an internship that is both educational and fun—now that’s the position you really want to get!

Creative Design

Facebook is known for its uniformity. You can post different content, pictures, and multimedia, but the basic design is the same on each page. Now with Static FBML (Facebook markup language) businesses can create their own custom landing pages. This is important because where searchers land will influence whether they click “like.”

A custom landing page can look more like a mini website inside of Facebook rather than the wall or newsfeed. There are a quite a few really good landing pages out there.

Even though you land on their wall, I particularly like Burt’s Bees. Their “Natural Too…” page really fits their overall marketing image/campaign. It looks natural, simple, clean, refreshing. What does surprise me is that they just went over 110,000 fans last week. Maybe this shout-out will boost their numbers. Kudos, too for letting us default to see posts by Burt’s Bees and others.

Runners up for best Facebook business page for creative design include, Coach, The Children’s Place and Wonka. Although, Willy, it’s time to update.

Free Stuff

I really wanted to find a great Facebook business page that gives away lots of FREE stuff. This was harder to do than I thought it would be. My best advice is to go to the pages for your favorite stores and products and click like. Also check for tabs on those pages with headings like, special offer, coupon, and deals. Really the best deals are for stuff we already like.

You may also enjoy checking into sites like freesnatcher.com and freestuffonfacebook.com. These diligent bloggers do the work so you don’t have to.

Most Likes

It’s funny how popularity works on Facebook. I still don’t know how Vin Diesel got to be so popular (16,809,153 fans), for example. Right now the most popular pages are Zynga’s game, Texas Hold’em Poker (24,841,218), Facebook (22,111,133), Michael Jackson (21,637,836), and Lady Gaga (20,366,689).

The October 11, 2010 issue of Forbes says Zynga, who owns Texas Hold’em Poker and Farmville (59,497,299 users), “is worth perhaps $5 billion.” According to that issue, “today there are more than 1 million developers working with Facebook data worldwide, mostly small-timers hoping to hit it big like Zynga.”

It was hard to shuffle through pages like “I need a vacation!!!” to find actual business pages. Top ranking consumer goods on Facebook are Coca-Cola (which has a very nice landing page, even though I prefer Pepsi) and Nutella. These two make Business Insiders top 25. I was surprised the page The Art of Travel by Louis Vuitton has garnered 1,434,226 fans. I wonder how many of their fans actually own a real Vuitton bag. I do have to say I give them points for their latest ad campaign, featuring Ali and Bono.

Local Businesses

Social media has changed what we can influence. Facebook is mostly free and small businesses are finding it greatly advantageous to spend time networking. One local pizza company claims that facebook saved their business.

Local to me? I live in a small Wisconsin town and I’m impressed at how well local business owners keep up and hold their own. Body Essentials at 88 likes is still pretty new to facebook, but owner, Kathy Hansen, does it well. She’s got video, pictures, and regular updates.

Forbes asks, “Who would you trust more for a recommendation, Google or your friends?… Now 80 of the world’s 100 largest advertisers are on Facebook.” Facebook has leveled the playing field. Big names and local business can have an online presence for free (or nearly). Local businesses are finding success on Facebook as people travel less and begin to realize the importance of shopping locally.

Best Two-Way Communication

Starbucks. Hands down. Most of the pages on here one of my friends likes. The popular pages are usually liked by five or six of my friends. Starbucks (at last count) has 10. Maybe that says something about demographics, but it says something. Starbucks has videos, actively engages, posts every couple of days, and keeps their content varied, fun, and interesting. They don’t push, there is no hard selling. They keep their fans interested and entertained.

Whatever your industry, you’ll find your fans are on Facebook with 500 million users and growing isn’t it about time you got “liked?”

By: Terra L. Fletcher, freelance writer and marketing consultant. She also teaches classes on Facebook and owns Fletcher Freelance.

Credit: BigStockPhoto.com

Are you a webmaster? Are you a freelancer? Do you run a home business? Has anyone ever heard what you do for a living and told you to “get a real job?” Oh, how that used to piss me off! Don’t people understand that working for yourself and working from home still have one key component of work? Apparently not.

Don’t fret too much if you’re in this situation now. You’ll get through it just like I did. My family didn’t understand what I did. They certainly didn’t understand that I was very good at what I did and that there was good money in it. I got grief constantly. My mother would randomly hand me job ads from the local paper as though she was trying to be caring and helpful (and deep down I do think she really believed that). At one point she even told me flat out that a “real job” meant working 9-5, for someone else, doing work that you didn’t really like. My sister would make the occasional comment about how no one wanted her to turn out “like me” (meaning sans employment and supposedly unhappy).

They were pretty clueless. I was extremely happy, even in the earliest days of self-employment before income picked up. It was about freedom. It was about pursuing a dream. I was doing something that none of them were able to do, and I was going to succeed (and have) whether or not they thought it was a good idea. Really, their concerns are understandable. Here’s why:

These people love you and really do want what’s best for you.

I know my mom wasn’t trying to piss me off when she’d tell me to get a “real job.” She was worried that I wouldn’t have a stable income and be able to support myself. She was concerned that I’d be lonely working by myself every day. She was afraid that the stress of handling a start-up would manifest itself in depression.

In my case none of that was true. I worked in a field where money was good. I have a large network of clients and colleagues I deal with every day — I probably interact with more people daily than she does in a typical office environment. And I was anything but depressed. Tired? Yes. (Holy friggin’ hell was I tired!) But it was a good kind of tired — an ecstatic exhaustion I suppose you could say.

People really don’t understand what you do.

The other common issue is that your friends and family might really not understand the work you do. I mean come on, what exactly does a webmaster do anyway? (Sure, we might know, but your typical John and Jane Doe probably don’t have a clue.)

I’m a full-time writer these days — a business writer. I write press releases, marketing copy, Web content, blog posts, etc. with a business twist or a business-oriented mission. But when people ask what I do, it always scares me. I know the moment I say “writer,” most people will have preconceived notions of a starving artist barely scraping by. That’s why I always qualify “writer” by explaining the business / corporate aspects. Then people don’t glare at me with a look of pity in their eyes.

Before I became a full-time writer, I was an independent PR consultant. You might think that being a consultant would command more respect from friends and family than being a writer or webmaster. It really didn’t. If anything, it just confused them. “What — people pay you to tell them what to do?” Um, yeah, I guess you could put it that way. What made it worse is that most people really don’t understand what PR is. In that sense, becoming a writer was a blessing.

Credit: Rachel D via Flickr

How to Convince People You Already Have a “Real Job”

I have to tell you, one of the best moments of my self-employed life was the day the “get a real job” speeches stopped once and for all. A family member needed some money for a down payment on a new apartment. We were just casually discussing it, and how frustrated they were, because without finding a way to come up with the money they wouldn’t be able to move as planned.

Credit: penywise via Sxc.hu

That’s okay. There’s nothing wrong with people needing to see something concrete. Sometimes that’s what it takes. Yes, it would be nice if they’d stop adding to the stress much earlier so we could get on with business, but the reality is that it’s the norm. As for those with incredibly supportive parents, friends, spouses, and others in their lives, I’m quite envious. For the rest of us, show people something “real” that they can appreciate and understand (money, media coverage, or a contract with an awesome big-name client for example), and you’ll shut up those “get a real job” rants in no time.

How about you? How many times have you been told to “get a real job?” How does it make you feel? Does it make you want to quit? Cry? Scream? Or do you just let the comments roll right off of you? Did you finally find a way to make those comments stop? If so, tell us how you did it by leaving a comment below.

There is perhaps no other single factor that contributes to the failure of small business as much as a lack of market research. Small business success isn’t something that happens by accident. Success is a result of conscientious market research and copious planning. Entrepreneurs are optimistic by nature. They tend to see what is possible, rather than becoming mired down in the negative or paralyzed by the claims of naysayers. Optimism and initiative are fantastic, but they won’t turn a profit without being coupled with proper market research and planning.

Hard work and dedication alone won’t guarantee success or profitability. Before you pin your future and your life savings on any small business venture, you need to determine that you can actually earn enough to support yourself with it. The only way to make sure this is even possible is by conducting market research. There are several questions to ask yourself throughout the market research process. Here are a few of the most important questions you will need to answer throughout the process:

Can I actually make money doing this?

This seems like a silly question, but it is one many small business owners never bother to ask. Starting a small business is not an “If I build it, they will come…” situation. The truth is that there are some products and services that cater to a very small niche market. You will need to build a fundamental understanding of the types of consumers and/or businesses that are most likely to buy from you, what their wants, needs and expectations are, what they’re having trouble getting and what will set you apart from your competition.

How can I meet my target market’s needs?

The best indicator of what your target market needs is what they’re currently buying. Find out what products and/or services within your chosen industry are selling well and which are experiencing a lull in demand.

What is happening to your target market as a whole? How are their needs changing? Will their needs change with age or will you continue to target a specific age demographic indefinitely? Do the members of your target market have children and does having children, or not, have an impact on their demand for your product or service? What are your competitors currently offering and what can you do better, or differently, to better meet a customer’s needs?

What are the price points for your products or services?

What are people currently paying for something comparable to what you will offer? Are people willing to pay more if the quality and perceived value are higher? Evaluating what people are willing to pay for a product or service can be difficult, but the most difficult information to gather is typically the most valuable in the long term.

Consider surveying your target market and ask them directly what they would be willing to pay. Social web platforms like Twitter, popular blogs and online forums can help you establish a direct link to your target market that will help make gathering this information much easier today than it was 10 years ago.

Study your competition. Find out what people are already paying for comparable products or services. Organizations like Mediamark Research & Intelligence – http://www.mediamark.com/ and Experian Simmons – http://www.smrb.com/ are invaluable sources for such information.

Who is your competition?

Identifying the companies that currently offer products or services similar to those you want to offer is critical. While you may believe your product or service is totally unique and that no one else offers anything comparable to what you will offer, that is incredibly rare. There may be no product or service out there that will mirror your offering exactly, but there is inevitably a comparable or substitute out there that already exists. Identify these companies and learn everything you possibly can about them, what they offer and who their target market is.

What can you learn from your competitors?

It’s not as if you can just call up your competition, run down a laundry list of questions and expect that they’ll answer you. On the other hand, we’re smack in the middle of the Information Age.  Competitive research is easier now than it has ever been.  The Internet is a gold mine for anyone conducting market research today. Not only can you look at your competitors’ websites specifically, but resources like Alexa and Compete can provide valuable data and outstanding insight.

If you feel your destiny is to join the ranks of the self-employed, that’s fantastic. You’re going to need a lot more than a desire to live out your destiny and good luck to make a start-up venture successful.  Before you hop onto the entrepreneur train, there are some important things to think about long before you walk away from your 9-5 job and the steady paycheck that comes with it.

Deciding what small business is best for you can be difficult. To find the right fit, start by brainstorming. Evaluating a few key aspects of your life can give your brainstorming some direction and help you get the ball rolling. Start with these seven and work from there:

Plan To Be Successful – What Do You Want?

Why are some small business owners successful while so many others fail miserably? Oftentimes it comes down to a true love and passion for what they do. If you enter into a small business just because you think you can make money at it, chances are you’ll fail. If you don’t have an enthusiasm and commitment to what you’re doing that goes beyond they money you may eventually make doing it, chances are you’re going to be a very unhappy and unsuccessful small business owner.

Strengths – What Are You Good At?

What are you good at? What have you learned throughout your lifetime and your professional career that you can put to use in your own small business? We aren’t always good at recognizing our own strengths and weaknesses. This might be a good time to enlist the help of friends, family and professional acquaintances you have worked with closely in the past. It’s important that you’re honest with yourself about your strengths and find an entrepreneural venture that will marry well with your strong points.

Preferences – What Do You Like To Do?

Just because you’re good at something doesn’t mean you enjoy it. Let’s face it, just because you’re good at math as a kid doesn’t mean you should grow up to be an accountant. Sometimes what you’re good at doesn’t light your fire and that’s fine. Keep in mind that when you’re starting small business, you will live that small business 24 hours a day, 7 days a week indefinitely. Make sure your business falls in line with both what you’re good at and what you like to do.

Hobbies – What’s Your Passion?

Parlaying a passion into a small business often brings together your strengths and your preferences. Do you enjoy golf? Perhaps opening a golf pro shop is the way to go. Do you have thousands of images you’ve created as your photography hobby over the years? Perhaps a venture involving freelance or portrait photography is your best bet. Even if you can’t translate your hobby into a potential money-maker, stop to think about what you love to do and why you love to do it. That simple step can help you figure out what small business has the most potential for success for you.

Skills – What Can You Do?

Strengths and skills are two very different things. Skills are much more specific and situational. As a small business owner you will have to wear many hats. Do you have basic accounting skills? Can you keep track of your accounts payable and accounts receivable on your own? Do you have any graphic design ability? Do you have any knowledge or understanding of human resources and the recordkeeping required to comply with state and federal requirements?

Previous Experience – What Have You Learned Up To Now?

Translating what you’ve learned throughout your career to this point is often one of the undefined variables that separate the successful from the unsuccessful in the world of small business. Dig deep and figure out what you’ve learned from each of your previous jobs, internships, classes and real world experience that can help make you successful in your own ventures moving forward.

Assess Your Network – Who Can Help You?

Who have you worked with in the past that might be willing to help you or want to work with you now? Who in your network of friends, acquaintances and former co-workers might be potential customers? Who in your network could become a potential vendor? If you can work with people with whom you have an existing relationship of trust it will help to reduce the potential for problems down the road. Take a close look at your current network to determine what advantage you might be able to gain from those people you already have a relationship with.

In the end, small business success often comes down to a combination of great planning, will to succeed, good decision making and a little bit of luck. Do your homework and your chance for success goes up exponentially. Fly by the seat of your pants and you’ll wind up among the whopping majority of small businesses that fail.

Starting a small business isn’t easy. If it were, everyone would do it. Moreover, if running a startup were easy, a much higher percentage of small businesses would succeed. The sad, and often discouraging, reality is that the majority of small businesses fail. Anyone who tries to tell you that there is a tried & true, guaranteed, step-by-step, fool-proof method to start a new business have obviously never done it. If you remember only one thing about starting a small business it is that there is no single “right” way to approach it. It is exciting. It is challenging. It is also frightening and often intimidating. The key is to never let fear or intimidation paralyze you.

Students of economics and business have studied the process of entrepreneurship for decades in an attempt to discover a single, universal formula that will guarantee success. That journey is as futile as attempting to figure out how to find a single genetic indicator or environmental factor to explain why some of us develop cancer while others don’t or why one twin struggles with life-long weight problems while the other twin doesn’t. As with health & wellness, there is no one formula that will guarantee success.

This fact is what truly appeals to an entrepreneur is the challenge of blazing your own trail and finding the formula that leads you down the road toward success and fulfillment. Most entrepreneurs are nonconformists at heart. They dismiss the notion that “it can’t be done…” or “it must be done this way…”. Entrepreneurs inherently want to do things their way. If you’ve been blessed with an entrepreneurial spirit, you know exactly what I’m talking about. And while there are no turn-by-turn road maps to follow, there certainly are some helpful guidelines that can help to steer you in the right direction and avoid common pitfalls.

For instance, it is important to know that in order to open a business account with any bank, you must have first filed your incorporation or DBA paperwork. If you are going to open a brick & mortar store or office, common sense will tell you that you must decide on its location before you can have phones installed or Internet service set up. The following small business startup checklist will help you to get moving in the right direction and avoid some of the common mistakes that put new small business owners at a disadvantage from the start.

• Decide on a company name.
• Decide where your business will be located.
• Determine the best corporate structure for your business (consulting with an accountant can be very helpful).
• File the necessary incorporation paperwork (consulting with an attorney can be helpful, but there are also many more affordable options available today – like LegalZoom – which allow you to file the necessary paperwork yourself).
• Consider what trademarks and/or copyrights will be needed to protect the brand you are developing.
• Decide exactly what products and/or services your business will offer initially.
• Identify your target market and compile data on where to find them and how to communicate with them.
• Decide how many, if any, employees will be required to operate efficiently.
• Estimate the monthly expenses for the business and projected sales on a cash flow statement.
• Complete a break-even analysis to confirm the potential profitability of the venture.
• Set up a business bank account.
• Hire a graphic designer to create your business logo, as well as any printed and online marketing materials – like a website, business cards, flyers, etc.
• Develop a search marketing strategy – understand, or hire someone who understands, how to take full advantage of Internet and search marketing, search engine optimization, website usability, etc.
• Establish a means of communicating with your potential customers (this can include telephone line(s), VoIP service, Internet access, e-mail accounts, etc.)
• Buy any equipment necessary for the day-to-day operation of the business (this can include computer(s), fax machines, printers, manufacturing/production equipment, etc.)

For any new small business venture, there are a seemingly endless number of things to consider. The items above are just the tip of the iceberg, but they will certainly help you get off to a good start. As you move forward with the development of your small business, knowledge will be the key to your success. For additional information on a wide variety of topics that apply to small business development and entrepreneurship, check out the Ewing Marion Kauffman Foundation website.

When you form an image of the quintessential American Dream, what do you see? If you’re like many of us, owning your own business is a part of that picture. In a world seemingly controlled by corporate greed and avarice-driven, overpaid corporate executives, our role as “the employee” is less appealing than ever before. For many, the security that comes from a steady paycheck is wildly overrated. Employees are feeling more undervalued every day.

The motivation behind wanting to follow the dream of business ownership is as unique as the entrepreneur himself, but there are several things every entrepreneur seems to have in common:

Flexible Schedule. Whether you’re a single parent or a happy bachelor, being able to determine your own schedule is appealing on many levels. Let’s face it, no one likes being told what to do. Most “jobs” require adherence to someone else’s predetermined schedule. Traditional 9 to 5 jobs are confining. Running a new business is demanding and the hours may be long initially, but having the ability to work when it is most convenient cannot be undervalued. Setting your own schedule allows you to more easily juggle the demands of work life and home life.

Control. Control over your own schedule is one thing. Some employees these days work from home or already control their own schedules – outside sales positions are a perfect example. Nonetheless, they’re still forced to answer to someone else and expected to help to achieve goals that may not mirror their own. Control over what you do during the time you are working is incredibly appealing to entrepreneurs. Being able to decide for yourself what work is to be done, what type of customer you want to serve and how to approach the day-to-day operation of your business is tantamount to an entrepreneur’s personal & professional happiness.

Financial Independence. Let’s face it, we’d all like to be independently wealthy, but for most of us winning the lottery just isn’t in the cards. A steady paycheck has always been a benefit of working for someone else. As with anything else, the apparent security of a steady paycheck has an opportunity cost. Are you really being paid what you’re worth? Is the amount of effort required to meet the demands of your position commensurate with your pay? For an entrepreneur, the more you work, the more you can potentially earn. That potential can be a great motivator.

Less Nonsense. And by “nonsense”, I’m referring to the corporate bureaucracy, office politics, bickering, nepotism, etc. Entrepreneurs believe typical corporate shenanigans to be unproductive and detrimental to productivity, creativity and ingenuity. As a small business owner, you call the shots. You make the rules. And you have the opportunity to decide how to run your business, as well as the best way to motivate yourself and your staff. No more empty mission statements and corporate dog & pony shows.

Maximizing Potential. One of the biggest advantages of owning your own business is the ability to take advantage of your full range of skills. Most employees don’t have a high level of control, responsibility or influence. As an entrepreneur, the responsibility for everything from answering the phone to paying the electric bill falls on you. Entrepreneurship provides a unique opportunity control your own destiny, utilize a wide variety of skill sets and develop those skills to their full potential.

Ownership. No one can dispute that ownership is a great motivating force. When your own personal and professional reputation is at stake, you tend to be willing to work harder to protect and build that reputation. Corporate mission statements often claim to encourage employees to take ownership of a situation and take initiative, but anyone who has spent any time within the corporate structure understands how stifling and restrictive that environment truly is. Within the corporate structure, decisions are made in the board room and forcibly carried out by front line employees. Entrepreneurs have an owner’s stake in literally every facet of the business and therefore have the incentive to do whatever work is necessary to create the most productive, effective and efficient work environment possible.

In today’s economic climate, amidst layoffs, downsizing and the general tightening of corporate belts in order to maintain bottom line profit margins, more and more people are choosing to see this as an opportunity to follow their dreams of becoming a small business owner.

Don’t Jump The Entrepreneurial Shark On A Whim

Before quitting your day job there are some important things to consider and take care of long before you even think of launching your own entrepreneurial venture. That said, here are 14 things to think about in advance – some of which seem obvious, but are surprisingly overlooked by new small business owners far & wide.

Narrow Down Your Product/Service Offering

Have you ever heard someone say “Over 90% of small businesses fail?” I hear it all the time. And while I believe numbers and statistics can be easily manipulated to say just about anything, that’s still pretty staggering. Much of that failure can likely be attributed to small businesses having too broad a focus from the start. New small businesses tend to try to generate revenue from virtually any source and, as such, often spread themselves far too thin. Make sure your focus from the start is narrow and specialized to match your skills, goals and business model.  A successful entrepreneur doesn’t shift focus.

Decide On A Company Name

Seems pretty obvious, right? Right. What isn’t so obvious is what goes into creating a brand based on your new company name, or the time that goes into researching a potential company name. Consider these factors when choosing a company name:

• Availability – is any other company anywhere in the United States (or you country of origin) using the same or similar company name? If there is another company using a similar name, but in a completely unrelated industry, you may still want consider it. However, at some point – even if the other company is not in competition with you in any way – there could be some branding issues from an Internet marketing standpoint. It is best to be completely unique whenever possible.
• Market Research – knowing your audience is key. Check out some of the most successful companies you will be in competition with. Is there anything that stands out about them? What are their company names? Do they market using their full company name or a DBA? Corporations spend tons of money researching what will appeal to their target demographic. Whenever you can, take advantage of their investment to gain some insight into the psyche of your market without spending a dime.

Where Will Your Business Be Located?

Again, this seems obvious…but you’d be surprised how many small business owners rent retail, industrial or office space without fully considering what they will need out of the space. You want to make these decisions long before they have the potential to impact your business. Is this a home based business? Do you need a retail location? What is the cost for the space you want to occupy? Will you own, rent, lease to buy?

Will You Have A Staff or Are You On Your Own?

How much of this work are you going to be able to handle on your own from the start? Will you need a full-time staff to meet the demand for your products or services? Will part-time help be sufficient? Who will handle the employment paperwork? Payroll? Recordkeeping? Hiring employees certainly does raise the bar on the level of difficulty for a start up, so great consideration should be given to this issue long before you launch.

Corporate Structure Options

There are a lot of corporate structures that address a variety of business needs. Should you opt for an LLC, a sole-proprietorship, S-corporation, C-corporation? Consult an accountant and/or attorney to help determine which corporate structure will work best for your business.

Establish Your Business Entity

Once you’ve decided on a business name and corporate structure, it’s time to file the paperwork. Can you do it yourself? Sure…but you probably shouldn’t go it completely alone. You could hire an attorney to handle it for you, but that can get a little pricey. There are a variety of companies out there that can help you. The Company Corporation and Legal Zoom are two such companies.

Projecting Sales and Expenses

It’s important to know where you are now and have a plan for moving forward. Estimating your monthly expenses and projecting sales on a cash flow statement is an integral part of the planning for any small business venture. More detailed cash flow statements will be created during the development of the business plan, but having an estimate in mind from the start is important.

Additional things to take into consideration:

• Complete a break-even analysis
• Establish a business-specific bank account
• Business communication system – cell phone, e-mail, VoIP, etc.
• Buy basic necessary equipment – computer, manufacturing, etc.
• Start building a list of potential customers
• Find a graphic/web designer & SEO/Internet Marketing
• Consider your future plans – investor control, your ownership percentage, etc.

When writing a business plan there are a ton of things to consider. The business plan takes into consideration all aspects of the business venture from rent to payroll to utilities to office expenses. There are three absolutely critical financial statements that should be included with every business plan.

Cash Flow Statement

The cash flow statement should be the first financial statement prepared for the business plan. The cash flow statement is an estimate of how much money you will bring in vs. how much you will spend over the next three years. These estimates should be broken down month by month.

The best place to start with the cash flow statement is by estimating your annual sales for the upcoming year and then dividing that total into monthly estimated income. Some business face seasonal ebbs and flows. If your niche is among these, that variation should be accounted for on a month by month basis in the cash flow statement.

Next you’ll want to estimate your monthly expenses. These expenses include literally every penny that will be paid through your business’s accounts payable record. Included in those expenses will be rent/mortgage on your facility, salaries for you and any employees, utilities, taxes, insurance, equipment leases, business loan payments, professional services – like attorneys and accountants – travel costs, etc.

Income Statement

Income statements are quite similar to cash flow statements. Like a cash flow statement, an income statement reflects all of the revenue and expenses over a particular period of time – typically a year. The simplest way to build an income statement is to start with your cash flow statement with a total column at the end. Use that total column as the starting point for your income statement and then add in any building depreciation, equipment, etc.

Balance Sheet

The balance sheet is often the most difficult to compile because the data doesn’t relate to any sales or expense figures. Balance sheets are separated into two sections. One section will be a snapshot of business assets – which is what you own, and your liabilities – which is your debt.

The first thing to do when creating a balance sheet is to make a detailed list of everything you think your business will own by the end of the first year of business. You should do the same for second and third years. Once you have the list, go back through and estimate the worth of each item on the list.

Don’t forget to include how much cash you anticipate having in the bank by the end of the year on the balance sheet. The amount of revenue in accounts receivable, real estate, property and equipment should also be included. Once you’ve got your list of assets and their corresponding values determined, add everything up. Voila…you have a balance sheet that is half complete.

Next come your debts. Make a list of everything you owe. Outstanding balances on leases, rental agreements, mortgages, business loans, credit lines and loans from family & friends should appear within your list of debts. Once you’ve completed your list, add up the numbers and there you have it – both sections of the balance sheet complete.

Business assets and business liabilities should ultimately end up equal, but don’t despair. Incorporating paid-in capital and owners equity categories into the liabilities section of the balance sheet can help you balance the numbers from the two sections.

Help With Your Business Plan

There are a lot of software programs and websites out there to turn to for help. Software like Business Plan Pro or Plan Write can be very helpful when crafting a business plan. There are also a number of websites – like Bplans.com and PlanWare.org that offer plenty of examples, free software and tools to make completing your business plan easier.