Posts Tagged ‘business’

Lessons in Startup: Business Plans

Posted on January 8th, 2012 by emdash in Lessons in Startup, Pixel Foundry

It’s true that to start a business, you’ll need a business plan of some kind. At the very least, to receive a business loan, your bank will want to take a look at one. Despite this, a lot of small businesses (especially sole proprietors) never get around to developing a plan, or believe they don’t need one.

The Pixel Foundry business plan took a while to write, partly because it was our first time being serious about starting up a company… but mostly because Statistics Canada is useless when it comes to properly categorizing and tabulating information on our industry. For us, the market research was the most difficult part of the entire writing process.

There are many good reasons to write a business plan. We decided against the bank loan route, but still needed the written document… here’s why:

  • The marketing plan section forced us to consider where we’re going to find our clients and how to reach them. From what I’ve seen with friends who’ve started up a business, this is where small businesses tend to fail. If you build it, they won’t come… because they don’t know you exist. Spend some time on this area and the financials – even if you don’t write a formal business plan – is my advice.
  • The financials section gave us a breakdown to let us know exactly how much we need to break even, pay ourselves salary, or grow and expand our business. From this, we could extrapolate how many projects we should take on per month, what our hourly rate should be, and how many clients we should aim to work with ongoing. Nearly every freelancer or small design studio charges too little at first, and we were no exception, but having these numbers prevented us from pricing ourselves into a corner.
  • The research section made us scope out the competition. This helps you develop your USP (more on that in another blog post) and find out if you are even offering something people want. We also gained information on how much other small design studios and freelancers charge, and what their portfolios include.
  • We worked on an exact list of goals over a 2 year period, including when to lease an office, when to hire freelancers to help out with work, and how many new clients we wanted per month. Remarkably, we’re close to our goals, perhaps because we set them with realistic expectations. It’s easy to get caught up in the grind of producing work… this goal-setting keeps you focused on the true reasons you’re starting a small business instead of working for someone else.
  • We knew what equipment, software, office space, and expenses would be before we even looked at whether or not we needed a loan. It turns out we didn’t need to go through the hassle of a business loan, since we didn’t have much for overhead. Too many people think they can’t start a small business without a huge investment. It helps, but if you’re tough, you can sacrifice for a while and be financially independent from the start.

If you don’t want to go through the process of writing a business plan, I’d urge you to at least write a goals sheet, financial statement, and marketing plan. These are the sections we have found the most helpful. You’ll probably find out later that your numbers were wrong, your marketing plan needed adjusting, and your goals weren’t realistic. Keep revising your business plan and referring to it… it is not a static document to be filed away!

Small Business BC offers an interactive business planner. Other samples and templates exist online.





7 reasons you should forget about those offshore “cheap design packages”

Posted on August 27th, 2010 by emdash in Opinion

In theory, it sounds good: because of the low cost of living in countries in Asia or Eastern Europe, there are countless designers and web programmers willing to work for less. On the surface, this seems like a great solution for your company’s budget: you can get your business’s website and branding done quickly for cheap.

I’m going to argue against going this route. Not only because the influx of cheap offshore “design firms” takes work away from skilled local designers like me (and yes, I have a bias here); I can think of several good reasons why your company’s public image shouldn’t be farmed out to people you’ve never met in a developing country.

1) Potential for sweatshops. Yes, the cost of living is lower in many parts of the world where these web-based offshore design companies are located. This does keep their price to their clients down. However, these countries also have different labour laws and regulations. One introductory (read: spam) email I received encouraged me to take advantage of a “design studio” in India, which was open 24 hours a day, 6 days a week. In my head, I’m picturing a dimly lit room, smelling of burnt silicon, full of old computers and exhausted malnourished teenagers. For all I know, it isn’t like that, but I doubt these “designers” are working 8 hour shifts with paid overtime to keep the studio running constantly. (As an aside, I think this would be an interesting topic for some investigative journalism. We know there’s sweatshop situations selling consumer goods, but are there similar setups for supposedly high-paid tech jobs?) If you’d hesitate before buying athletic shoes you know were made overseas by children, why would you risk buying your company’s image from a sweatshop?

2) There are good designers in every part of the world, in every country. But they’re not selling their services for $5/hour online. Any graduate of an accredited design school in any large city around the world would likely look for a job in an established advertising or design agency. They’ve invested time and money in education to work in their field. If they’re good, they’ll be doing projects for large national corporations and working their way up to art director. What they won’t be doing is selling their services at incredibly low prices over the internet.

3) There’s no local reputation, references, or network in place to give these offshore studios accountability. Working with a local freelancer or design firm, you know you have recourse if there’s ever a dispute over the work or price. Aside from the legal system in your country, you can also talk to the designer’s other clients and ask for professional references. You can physically meet them and see their place of work. You can gauge, person to person, if they’re someone who you can trust with your company’s brand image. You have none of this security when you outsource your work offshore. While you can damage an internet company’s reputation online, there’s nothing stopping these companies from simply changing their name and website and starting over with the same business formula.

4) It can be difficult to communicate with someone you can’t see face to face. When you’re working long distance with someone, you have to ensure your written communication is very clear. Not a lot of people are excellent communicators; it’s a rare enough skill that many design studios have a full time writer on staff. When you’re dealing with someone whose first language isn’t English and you only communicate through email, misunderstandings can happen. Cultural differences won’t help this either. What may start as a cheap project can end up costing more and more as mistakes have to be corrected.

5) There’s no ongoing relationship between designer and client. You probably won’t be getting the same designer working on your projects even if you do go through the same offshore company over and over. (You actually have no way of knowing who is working on your project; it probably won’t be the person you’re contacting.) If you work with a local freelancer or team, however, you know exactly who is working for you. This client/designer relationship is so important. I can’t stress enough how crucial it is to have someone who really gets your company working with your image. There will be no consistency in quality or branding standards if you risk taking your projects to an offshore “design firm.”

6) Copyright and intellectual property rights are different in the developing world. Knock-off consumer goods are everywhere, and so is copyright infringement. Someone who is only being paid $5/hour might be lazy enough to plagiarize or outright copy existing design work. They may not even know they’re doing something wrong, because attitudes towards this are different in different areas of the world. Unfortunately, there’s no way for you to know this is happening, and your company will be the one threatened with legal action, not the offshore company.

7) If you’re a design firm, studio, or freelancer who outsources client work offshore, you’re lying to and ripping off your clients. I don’t care if you’re busy, if it’s just a small project, if you agreed to more work than you have time for, etc. There is no excuse for charging your clients your studio rate, then farming the work off to some $5/hour offshore web company. Your valued client believes they’re getting the care and attention of a design school graduate, when in reality you’re just being greedy. Now, outsourcing is part of the business for sure, and I frequently work with outside developers, illustrators and copywriters on my projects, but surely to God you have a local network built up of skilled professionals whose work you trust and don’t mind putting your studio’s name on.

I’m sure these statements don’t apply to all/some of the offshore companies out there. I’m writing mainly about the cheap branding and design packages out there from web-based companies referring to themselves as “design firms” or “design studios”. Regardless of their location, these companies undermine the importance of design work in our society. They are not contributing to a competitive market for design services.

If you’d still consider going this route for your business, cavaet emptor. You get what you pay for. Be prepared to pay a second time to get a local professional you can trust to fix the offshore work.



dot tel: organized and up-to-date contact info

Posted on June 9th, 2010 by emdash in Reviews

Participants at the Freelance Camp 2010 received a voucher for a .tel domain through webnames.ca – naturally, I wanted to set it up asap because I apparently don’t have enough websites.

Dot tel is an interesting idea: rather than a domain for any hosted website, it uses DNS records to display the information you input. The concept: you’ll use it to keep up-to-date contact info, rather like a digital business card. Rather than reprint contact information on your stationery or email your entire address book when you change your phone number, you’ll point everyone to your .tel address for the latest methods to reach you.

I chose meganseely.tel for my domain, and treated the account like a directory of what I do and ways you can pester me on the internet. I’m not sure how useful I’ll find this (or annoying,) but at the very least it gives me one place to look to see which social media I haven’t logged into or updated in months.

In a sudden fit of fancy, I added all my Second Life details. (How I’ve managed to run a virtual business in Second Life is probably a useful topic for another blog post, or twenty.) Both of my design companies are listed with all their contact details. My personal link includes my birthday, in case strangers feel compelled to buy me a drink or present on August 25th.

I found the interface for the .tel setup more than a little confusing. For example, there’s a section for keywords. This is for search engines, it claims. But the keywords section includes space to write your address, hobbies, nicknames, etc… and shows up on the page itself. (Note there’s no way to add an address under your general contact info.) I always thought keywords were… well… keywords.

I’d also have liked to see a bit more thought put into the themes for .tel. Now, I realize with an annual price tag of $20 and no hosting fees, it’s not going to be a full-fledged website, nor should I expect it to be. I’d like to have been able to change my font colours as well as my background colours, though, since the text defaults to white on several of the page design options and I use a pale silvery grey for everything Em Dashy.

I was a lot happier once I figured out I could have subdomains on .tel for all my information types. I’ve split it up by company, but you could easily do: Work, Personal, Social Media or Day Job, Freelance Company, Personal, etc. The subdomains worked quite well for me, since I’ve got more than one thing on the go.

Overall, for the price tag, I’d recommend getting a .tel for anyone who uses online networking for their business. More than just an online business card, it can serve as a one-stop spot for potential clients/customers to learn everything about you. Think LinkedIn without the boring resume reading.

——

Postscript: The generational gap is showing here: I’m young enough to see the “V-Card” link on the dot tel page, and think that if I click it, it means I’m no longer a virgin.



cspixelfoundry.com launch

Posted on May 18th, 2010 by emdash in Pixel Foundry, Work

Few things are as satisfying – to a small business – as getting your own website launched. Like business cards or a physical office space, it lends credibility and a feeling of being “official.” Chestnut St. Pixel Foundry was looooong overdue for a site that was more than just a mailing address and meta tags… and finally, we’re live!

I’m going to offend a few people I know by informing you all that I, personally, cannot stand the web 2.0 aesthetic in web design. At a certain point it crossed a line from friendly and easy-to-use to simply insulting the intelligence of the user. I mean… 24 point type telling me to login just makes me feel like I’m being unnecessarily babied… and I don’t like it. I also feel the excess gradients, reflections, etc are going to look pretty dated in a few years, forcing another redesign/refresh of the site… I like classic and timeless design that carries a business or organization through any period of time.

So, web 2.0 was out for the Pixel Foundry’s website. Instead, we looked to Victorian inspiration: scrapbooks, photo albums, wallpaper and decor, etc. We came up with the idea of using a page for the background… a literal interpretation of the website as a page of information.

There was a lot of technical stuff here to solve. Earlier versions of Internet Explorer hate transparent .pngs… but there are still people out there unfortunate enough to be using IE6. The paper “page” background takes a while to load, and until it does, the site doesn’t look right (this was resolved with a “loading” script that wouldn’t display the site until the page was finished.) We wanted to feed JUST ONE post at a time from our tumblr but tumblr’s default embedding script is fairly inflexible.

We took a bit of liberty with facebook and LinkedIn‘s logos… which I think is fine since almost everyone else does it too. There’s probably as many graphic variations on the facebook icon as the rss icon.

My favourite though are the vintage-looking pictures of Kelly and I. I was tempted to add more members of the team (eg. Leeloo and Godiva, my two black cats) with similarly-treated photographs, but held off ‘cos that would just be silly. And of course our website is 100% serious.

Next step: iPad version.