Starting a Small Business

Course CodeVBS101
Fee CodeS2
Duration (approx)100 hours
QualificationStatement of Attainment

Start Your Own Garden, Landscape or Horticulture Business

It can be daunting to start a business - do you have all the skills you need to succeed? There are hidden traps that can be avoided and techniques that can be used to assure success. Make the most of our professional tutors who will help you to develop sound business skills throughout this course. Set your self on the right path from the start!

Lesson Structure

There are 12 lessons in this course:

  1. Introduction to Small Business
    • Types of business and communication, types of language, office equipment.
  2. The Business World
    • Consultancy services, law and business, the landscape industry, business letters, communication systems.
  3. Your alternatives - different types of ventures
    • Buying and starting a business.
  4. Marketing
    • What is involved in marketing, advertising, selling, communication.
  5. Planning
    • Organising and planning to ensure the success of the business.
  6. Basic Bookkeeping
    • Financial statements, balance sheet, profit and loss statement,insurance.
  7. Sales Methods
    • Selling, sales method, telephone canvassing.
  8. Budgeting
    • Assets and liabilities.
  9. Developing a 12 month business plan
    • Protection, planning and production.
  10. Implementing a business plan
    • Communication with employees, planning the development of the business.
  11. Reviewing progress in a new business
    • Research, evaluate and decide on business plan updates.
  12. Improving profitability
    • Increase profit and reduce expenditure.

Each lesson culminates in an assignment which is submitted to the school, marked by the school's tutors and returned to you with any relevant suggestions, comments, and if necessary, extra reading.

Aims

  • Discuss the nature of small business and the skills required to run one successfully.
  • Explain the legal requirements, restrictions and the costs of running a small business.
  • Describe the different aspects and considerations associated with starting a new or buying an existing business.
  • Explain the marketing process.
  • Explain the importance of planning in the running of a successful business.
  • Explain the importance of record keeping and the principles of bookkeeping.
  • Determine sales and promotions strategies in small business.
  • Explain the importance of budgets.
  • Develop a business plan.
  • Implement a business plan.
  • Identify factors that affect profitability.

Advice from our Principal, John Mason, on Getting a Start in a Horticultural Business

The first decade of my working life was spent learning about business. The second decade was spent using what I had learnt. The third decade I fine tuned my skills. Now as I enter my fifth decade in the work force, I find myself with a series of profitable business interests which have a growth rate above the inflation rate and a structure which affords me a degree of flexibility I would never have had working for someone else.

For me, success in business is due to following some simple guidelines, and keeping balance between the attention I give to each one. It is all too easy to concentrate on one 'rule' and ignore the others. No matter how important that rule is, sooner or later your business will come unstuck because of some other 'rule'  or guideline you have been neglecting.

I believe a business has a greatly increased chance of success if you:

1.  DON'T RUSH IT
Businesses which try to do too much too soon have a far greater chance of eventual failure (even if  initially they are successful). It is wise to go through thorough business planning before starting up and to have a long term plan (10 to 20 years), which you can slowly work towards. In my case, I was setting up a correspondence school. I saw the first step was to establish a reputable name and I considered that  to do so might take many years. Hence for the first 5 years, I was not impatient about making money   I made sure that I had other sources of income apart from my school. It was more important at this stage to gain acceptance and recognition amongst potential 'customers', than to make a profit. This sort of plan will generally require you to put in quite a few extra hours of work, juggling the needs of raising a living, and trying to develop your new business. However, in the long term, if your business becomes a success, you should have greater opportunity for personal time (i.e. rest, relaxation, hobbies, family commitments, vacations).

2.  OFFER A PRODUCT OR SERVICE WHICH IS RELATIVELY UNIQUE
Your chances of success will increase greatly if you can supply something people want, but can't easily get elsewhere. A lot can be gained by taking time to study the way people live, the things they do in their day to day lives and the problems they encounter.

Many businesses have been based on the observation that in modern society, where both husband and wife work, it is a problem for the family to find time for the mundane day to day chores. Consider the rapid increase in recent years of such things as child minding services, nannies, lawn mowing businesses and fast food chains. All provide ways to get essential things done more easily for people who have the money, but don't have the time. You do not necessarily have to provide a service or goods that are not generally readily available. You might, for example, live in a rural area where goods and services that are readily available in larger cities are scarce or not available. You might be able to create a valuable business providing one or more of these items.

Research plays a very important part in choosing what goods or services to supply. This might involve looking in newspapers and magazines to see what sorts of goods and services are, or are not, being provided in your area, and seeing what is successful in other areas, but hasn't been tried in your area. Get to know your market.  Market research does not need to be formal.  It can be based on observations of what is occurring, what people want and aligning your strengths to that area of the market not being served.

Taking heed of your own observations or needs can be an excellent way of finding a niche area that could be filled. For example, a lady in Melbourne was concerned about sunburn on her bare arm when driving. She obtained some material with a high sun protection factor, and after experimenting with a few designs, created a simple pull on sleeve to go over the bare right arm of a car driver. Other people expressed interest in her designs, and she began to make and sell them, many to friends and acquaintances. Word of mouth from these customers created more sales. She began to advertise a little, and approached selected shops that she thought might be interested in selling her product. She began to produce larger amounts in different sizes and a wide variety of colours. Several chain stores expressed interest or began to sell her products. She began to export her product. All of this happened in less than five years. She began small, and used her profits to finance her expansion, resulting in low financial risk to her. This is just one example, many others exist.

Another area to consider is to do a job better than what is already on offer.  One successful small business started when the receptionist at a doctor's office overheard two of the doctor's patients complaining about their hired house cleaners.  Both were saying they were very dissatisfied and the receptionist said "Hire me.  I'll do a better job."  One of the two patients did hire her, and, true to her word, the receptionist did do a better job.  The ex-receptionist now has a team of house-cleaners.  Her success has always been in delivering top value for money.

3.  USE THE SKILLS & EXPERTISE YOU HAVE OR OBTAIN NEW SKILLS

If you have some existing skills or expertise and can work out a unique service or product you can supply you are off to a good start. You will often feel more comfortable, at least initially, supplying goods and services you are familiar with, or are a logical extension of your existing skills and talents. In many cases skills and knowledge gained in one industry might readily be transferred to another (e.g. sales and marketing, bookkeeping).

If you aim to go into business in a new area then educate yourself in that area before anything else. This might be through formal study, perhaps while still working in another career, through informal study (e.g. buying books and trade magazines and reading them at home), working for someone else in a similar business, perhaps full time, or part-time on weekends, or at night, to gain experience before branching out on your own.

The important thing is to determine the skills and knowledge that you will need and make sure you obtain them. This also requires some prior research.

Your business knowledge will also play a huge part in your success or failure.  Many people who are true experts in their field have failed because their lack of business know how.  You must be able to accurately cost a job and provide value for money.  One landscape company foreman felt cheated because he was the person who saw that the job was completed and managed well, yet the profits went to the company owner.  He believed that the 'business' side would be easy, so went to work for himself.  What he didn't realise is, that while he was an excellent project manager, he was not very good at costing jobs and dealing with customers.  Fortunately for him, he was able to return to his previous job.

4.  GET YOUR ADVERTISING RIGHT
Experimentation: this is the key. Do not spend a lot of money until you have properly worked out what does and does not work for you. Try small advertisements in a range of publications, perhaps classifieds at first. Try different types of advertisements. I have advertised in over 200 different publications, of which only around 20% have been worthwhile. Try press releases. Send them to magazines, newspapers and radio stations. Record where your responses come from and where your firm business comes from (e.g. one publication might give 30 responses and none of them do business, with while another might only give 5 responses but 2 of these do business with you).

Talk to others in the industry. Find out what advertising has and has not been successful for them.  Join an industry group to make contacts.  Many business people will share their information, allowing you to learn from the mistakes of others.

5.  GET YOUR PRICES RIGHT
Too many businesses go broke because they charge too little. Henry Ford may have become a billionaire by selling a large quantity of cars at very cheap prices, but more often than not, people are just as happy to pay a higher price if you give them quality and good service. Remember, small business is just that   small. If you are going to succeed with the low price high turnover formula, you need to be operating on a large scale, usually with a high level of investment.

6.  GET YOUR COSTS RIGHT
All too often, small businesses pay more than what they need to for materials and equipment. If you take your time before starting to thoroughly check out suppliers, and learn to negotiate about prices, you can establish much lower costs for your business before you begin. Remember every dollar extra you pay in costs is a dollar less in your pocket.

7.  BE PREPARED TO PUT IN MORE THAN YOU GET BACK (INITIALLY)
Usually the first few years of any small business will require long hours, perhaps a 6 or 7 day week;
and all this for perhaps a lesser return than you would get working a normal 9 to 5 job. If you have money or other resources set aside, or supplementary income (e.g. your partner/spouse has a full time job) as a backup to cover you through this lean period, you will have a much greater chance of success.

It is important that you and your family consider the many sacrifices that come with starting up a small business, including less money to spend on entertainment, no time for travel or holidays, longer working hours, etc.  If you do not have the full support and understanding of the family, then making the business work becomes doubly difficult.

8.  GIVE THE HIGHEST PRIORITY TO THE CUSTOMER
A happy customer is the best asset a new business can have. You will then get more follow up business from existing customers, and they will be your best source of advertising, simply by word of mouth.  There is truth in the saying "One happy customer will tell one other person.  One unhappy customer will tell ten others."

9.  MONITOR YOUR COMPETITION
Subscribe to any magazines or newspapers which report on the industry you are operating in. Monitor advertisements in that industry. Keep a close eye on any other business offering similar services or products, and watch out for any new businesses which might offer competition.  Join industry associations or mentor groups, to keep abreast of what is going on.

10. DIVERSIFY AS SOON AS POSSIBLE BUT NOT TOO MUCH
Initially you should not try to provide too many different types of goods or services, but once your business begins to establish, look for other services or products which might complement what you are already doing. Demand changes, that is a fact of life. If you do one thing only, you will find there will be times your business will boom and other times it will be slow. If you do several things, there is a good chance that when one thing slows, the others will still perform well.

Keep in mind, though, that you cannot be all things to all people.  If you diversify, try to add either a business or service that complements your core business, but does not detract.  For instance, the addition of a restaurant service to an existing bed and breakfast is a good diversification.  It complements and could even increase the B&B business. Likewise the addition of weed control services to a lawn mowing round.

11. DON'T BECOME BIG JUST FOR THE SAKE OF BEING BIG
There is a natural tendency for your own sense of self importance to grow when you are the boss, and as that happens, there is a tendency to increase the size of your business beyond what is reasonable. Immodest employers tend to employ more people than are required, advertize more than is needed, and produce more than what they can sell. Just because a business is bigger, doesn't mean it is run better or more efficiently, or is more profitable. In many cases well run, smaller businesses can be very profitable, and enable you as the boss to keep good control (oversight) of the businesses activities.  Part of your long term business plan should also include what you want personally in the long run.  Creating a large enterprise that is still growing when you are ready to retire can cause a real dilemma.  Many people start up in small business because they want a more relaxed lifestyle.  This can be achieved, as long as you recognise your own goals.
 
12. TAKE CARE OF YOUR STAFF
Good quality staff are the most valuable asset in any business. If you are loyal and generous and flexible with regard to your staff, they will respond in kind.

13. TAKE CARE OF YOURSELF
You must be healthy to deal with the stresses associated with running a business, and still be able
to think clearly and operate efficiently. Healthy businessmen put in less hours and achieve far more than those who neglect their basic needs, such as exercise, diet, rest and recreation. Running your own business is not just about making money, it is also about taking control of your life. Your business should ideally give you the financial rewards, job satisfaction and personal flexibility you desire. This may not happen initially, and in fact is unlikely early on in the life of a new business, but should be a medium to long term aim of the business.

 

THINGS TO BE WARY OF

There are many common mistakes made by people operating garden service businesses.  Some of these are listed below:

* Advertising that you will do anything (when you don't have the skill or the equipment to do many  gardening jobs).

* Underquoting when you first start your business. You are best working on an hourly rate (at least until you become familiar with what you are  capable of getting done in a given time).

* Not including overheads in a quote. It costs you time and money to travel to a job, to supply tools, office costs, equipment maintenance costs, to give a quote in the first place, etc. All of these costs have to be covered.

* Wanting to get a job no matter what the terms are. There are plenty of people who think gardeners should be cheap labour; there are others who think cheap gardeners are not good gardeners.  You should not be afraid to lose a job because you are too expensive.  Someone else may just hire you because you're not cheap.

* Liquidity Problems. Some types of garden service jobs require you to have a certain amount of cash in hand. 

If you are not paid for a landscape job until weeks or months after doing the work, you need to have sufficient money in hand to carry you for that period.  If your work is seasonal, you need to save enough in the good times to keep you going in the bad times.

 
* Not being clear in what you are going to include in the job. Clients may expect free garden maintenance after a landscape job. Some people expect free removal of rubbish after a pruning job. Some people expect you to come back and spray again for free if your first pest or weed spraying doesn't work. Some people expect the roots removed as well as the top of a tree when you quote on tree removal, or for all of the wood to be cut up into short blocks suitable for fire wood. Clearly state EVERYTHING that is to be included on the job and don't feel pressured to do more than you contracted for. MAKE SURE THE CLIENT UNDERSTANDS WHAT YOU WILL OR WON'T DO!

* Legal Requirements. There are different legal requirements which must be met by different businesses in different places. In some places nurseries or landscape contractors must be registered with the government, or perhaps be involved in an industry accreditation scheme. Any
business has certain obligations to keep financial records for taxation. Staff must be employed in accordance with other regulations. In some situations, workplaces must be registered or approved by government authorities. Businesses must be structured in a way which complies with legal requirements, and you must understand, decide upon and set up an appropriate structure if you are to minimize legal liability for anything which happens in your business. Most state governments have departments that provide advice to small businesses and what rules, regulations, etc. are relevant to their business. It is important that you find out what these are. Trade or industry organisations (e.g. Landscape Industry Associations) are also valuable sources of information.Licensing may be required for the tasks you plan to perform. Check with your local government authorities.

* Professional Advice: As a business person, you are a professional. Respect the fact that you will also need assistance from other professionals to be successful. The advice of a good lawyer and a good accountant can be invaluable.  Even advice from more experienced professional people within your industry may benefit your business, for example, getting the advice of professional irrigation consultants or horticulturists instead of trying to bluff your way through a job. You do not always have to follow their advice, but being better informed will help you to make sound decisions.

 

Who Will Benefit From This Course?

Anyone setting up a small business or running a small business will nefeit from learning about the fundamentals it takes to do that and be successful. A great course that has had many students learn and succeed.

 

 

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