To celebrate our 25th anniversary our Chairman, Sarah Chiumento, shares the lessons she’s learnt about running a small business over the past 25 years.
Chiumento was launched in 2004 so is now celebrating its silver anniversary with some lovely posh chilly bottles in silver – very apt!
So what have I learnt in those 25 years? Lots… but I have tried to limit myself to just five key things so I don’t get too boring.
1. Guess what? Running a business isn’t easy!
I suspect many of us start down the self-employment road thinking it will allow us to take charge of our own working time and pace. Actually, if you want it to succeed and really build a business, it’s quite the opposite. Your clients are in charge. You have to work whenever necessary to ensure you satisfy them. So don’t start a business if you’re not prepared to work as needed, or if you don’t have the support of your family to do it. Check that carefully first, or there will be huge conflict. On more than one occasion I have found myself at meetings during the Christmas/New Year holiday season. No choice. They wanted to make a change at year end and needed to get planning. My daughters were philosophical about it…. ‘Where’s mum?’ … ‘Oh, she’s working’ … ‘What? It’s Christmas!’
2. Employ people who are cleverer than you.
It’s really important not to be precious. All my staff have things to offer that I can’t do or am pretty hopeless at. That’s why they are all valued team members. I have learnt a lot from my own staff. And from psychometrics which taught me that we are all different and sometimes things that seem boring to me are thrilling to someone else. Having a diverse team is important. Having a team that really cares, for me, is vital.
3. Don’t be afraid to try things and make mistakes.
I can point to lots of those in the last 25 years, but every one of them taught me a lesson and when one thing doesn’t work if you can take the core learning from it and build something else with it so all is not lost. It’s a lesson I learnt at a Richard Branson talk early in my Chiumento career. Life is a gamble, and work is no different, so (as long as you can afford for it not to work out and sometimes even if you can’t afford it) try things and see what happens!
4. Cash is king!
It’s so easy to get carried away with making sales and lose sight of whether those sales are really making money. So easy to forget what it costs for each piece of work you win, and whilst some things are ‘sunk costs’ that would happen anyway they still have to be paid for. So, in the end, the only thing that really matters is your cash balance. Is it going up or down? Where is it heading next month… next quarter … next year? Planning ahead and being clear how you will keep that cash balance going up overall is critical.
5. Value existing clients and keep them.
Tell your clients when things have changed. Reputation is everything but isn’t always easy to manage. If you need to put your prices up, tell your clients why and don’t be shy of doing it. Equally be mindful of the ‘attract a new client’ versus ‘retain an existing client’ conundrum: If you have a long-standing client and have agreed a similar service to a more recent client on better terms, offer them the new terms too. They will love you for telling them. And if you don’t they will only find out and feel cheated.
Overall, be good to yourself, your staff and your clients and you can’t go far wrong. Over time we have encouraged our staff towards health and fitness and towards community projects with positive results. Now, as a virtual organisation, we encourage self-direction and management so achieving outcomes is more important that start and finish times and going out for a run in the middle of the day is fine. I’ve never believed in the maxim ‘treat them mean and keep them keen’ …. it just isn’t true!
And finally, of course, have fun!