But is a business partnership meant for anyone? I don’t think so.

True, the entrepreneurial path less taken will be less lonely with a business partner.

But do consider these factors before entering a partnership:

1. Both partners’ personality
2. Both partner’s working style
3. Both partner’s value
4. Integrity

A friend may not necessarily make a good business partner. Do realise that work ethics of really good friends may differ greatly. Just because you’re comfortable with someone in a social setting doesn’t mean you will work well together. Don’t jump into the partnership because of convenience (your friend etc.). Try doing a small project  or organise an event together to gauge the dynamics of your working relationship.

And of course, sharing similar values mean that both parties will move in the same direction. In times of difficulties, it’ll be more manageable to come to an agreement and move the business in a certain direction.

Integrity is the most important factor in my opinion. You got to trust your business partner and know that he/she will always make decisions in the best interest of the business.

So far, I have been talking about partners in terms of 2 people. If your partnership is one that consists more than 2 people, it just mean that you have to think through the above several times over.

Although the stressful period of retrieving my bad debt is over, I still have many customers that cannot pay up in full or delay the payment by 1 month or so.

One in particular was unable to pay us the large amount that accumulated over 2009 Christmas sales.

After understanding their situation and the business owner’s sincerity, we worked out a payment deal in which we would collect a fixed amount of money weekly so that our cash flow can improve and it will not be so taxing for our customers to pay us a one big lump sum of money.

5 months have since gone by and I’m happy to say that 70% of the debt is cleared.

We have been supplying goods to this customer the whole time throughout and they try their best to pay us, albeit having 1 or 2 weeks delay sometimes.

This arrangement has helped both of us to continue working together without much unpleasantness and more importantly, to serve our customers and grow together.

I guess different situations call for different debt collecting tactics.

I saw this article in Singapore’ Straits Times this morning and it reminded me of when we first started our business in early 2009.

We were in the midst of the financial crisis and many questioned my rationale for wanting to start my business then.

Out of concern, they forewarned that it may be safer to leave my well paying job in a year or two instead.

It has been said that entrepreneurs are a little crazy, for they have to cast aside their fears to take on the many risks that come along with being their own bosses.

I don’t think I was that crazy a year ago. Afterall, if being an entrepreneur is about taking on calculated risks, I’d face economic downturns again in my entrepreneurial journey. This may be my first, but it definitely won’t be my last. It’ll be a good learning lesson.

I’ve discussed and thought this business through before the financial meltdown and didn’t think want to put this idea off until when things look better.

And looking the bright side, companies were having pay freeze, pay cut, headcount freeze, bonus freeze, extra workload for staff etc., I’ve got less to lose then! Also, if I were in the pits then and could survive, it’ll be a easier ride up when the economy turn around. And it is.

Simply put, I put in a lot of care to select the right kind of customers for my business.

And here’s my story:

When we first started the business about a year back, we were feeling our way around and once in a while, we receive feedbacks from customers that they spot similar products priced much lower than our brand’s.

Initially, we were concerned and worried that these lower price items will hurt our business. We tried to match the prices whenever we could and sourced from cheaper alternatives.

Later, we realised that we wouldn’t want to compromise on the quality of our products and the way to go is to build a reliable brand name for ourselves.

This, we did. Today, I am happy and proud to say  that our customers consist mainly of those who appreciate our designs and value good customer service. They are willing to pay a little more for the whole package and to have a better shopping experience.

Not having to compete mainly on price, I can focus better on giving the best value to my customers. Also, I don’t have to spend my previous time with customers who haggle for a long time over pricing.

It certainly is more enjoyable to focus on great customer service and product quality than to handle a customer who keeps asking for more discounts.

Now, who are your target audience? Share with me your thoughts on this.

]]> http://www.theentrepreneurbusiness.com/select-your-target-audience-with-care/feed/ 0 http://www.theentrepreneurbusiness.com/why-we-choose-the-debt-collector-case-1/ http://www.theentrepreneurbusiness.com/why-we-choose-the-debt-collector-case-1/#comments Wed, 14 Apr 2010 14:12:57 +0000 Stardust http://www.theentrepreneurbusiness.com/?p=301 I am naming this as case 1 because I am not that optimistic to think I’ll never have to engage their service again. Am just keeping my fingers cross that it won’t be anytime soon.

Anyway, there were a few reasons why we chose to go with the debt collector instead of going through the Small Claims Tribunal.

1. The debtor was closing down the retail shop in 2 months time.
   • It takes about 2 weeks before we can attend the hearing before the Registrar.
   • If there’s any disputes and we cannot come to an agreement, it may take even longer to get the settlement.
2. The debtor is a retail outlet with no much of asset. Even the more “valuable” items in their shops have some flaws or damages.
   • It may even be a waste of our time and effort to pursue and file for a writ of seizure in the event it escalates to this stage.
3. The debtor owes a lot of suppliers money.
   • We figured that if we weren’t one of the first to file the claims, we may not even get back our money.
   • Or that we may only get back a small portion of the debt.
4. We were drained…
   • We were exhausted from chasing and asking for payment day after day, week after week.
   • It was more worth it to pass on this frustrating job to the experts so that we can focus on generating sales and growing our business.

And so, we weighed our odds and it has proven a well-made decision! =)

I called up IRAS today and found out a few more things regarding e-filing for my partnership company.

Just for your info, especially if you are a new company that may not know these:

• Medisave contribution is compulsory for individuals who earned net income of $6,000 and above.
  • For eg. Profit is $10,000 and Partner A’s share is 70%. Partner A will have to contribute to his Medisave but Partner B who is holding 30% doesn’t have to.
  • The rates can be found here.

• Personal income tax filing (From B/B1) is required after you’ve filed Form P
  • This is even so if you’ve received the letter from IRAS informing that you do not need to file your personal income tax as it will automatically be done for you.

• Only Entertainment for Others falls under Allowable Business Expenses
  • Which means that food and drinks you buy for yourself is not allowable. Hmm… hard to split right?

Being your own boss means the new brand will be everything you want it to be, from the feel to the look, from the sound of its name to its target audience. It’ll be your baby and it’s satisfying when your brand gets recognize for its goodness.

Brands Worth their Gold

We will soon have a new product line and in the midst of this lazy and hazy afternoon, I shall churn my brain juice for some nice sounding names.

It’s time for my brand new brand! =)

And let me apologise for this week’s infrequent posting before I start writing. I have been busy and a little lazy too. Will remind myself to stay discipline and be on track.

I was just speaking to a friend just now and we brought up the issue of people owing others money. It makes both parties uneasy and unhappy when one has to chase for payment, no matter how nicely it is done.

Yet, I have came across several debtors that have given me the attitude that I am wrong to ask for the money that is rightfully mine.

If you’re one of those that behave as above, I urged you to stop doing so. Just stop to think how it’ll feel if your boss holds back you salary even for a few days.

No matter what’s the reason, do remember that most of us do not like to chase for payment too. It’s simply something that’s so vital to a small business owner that we just have to do.

It certainly can get draining and even discouraging at times being a small business owner. In the course of over about a year. I’ve met many new business owners too and most times, it’s everyone for themselves.

Of course, we do have very nice customers and partners who are the precious rare few. And it’s these people that make the entrepreneur journey a delightful one. And I’m thankful to have met them and work together with them.

I wonder to myself whether it’s my outlook and attitude. Will I behave in a menacing way when my business is more established? Will I try to kill of competition by snubbing out the little breathe of life in them?

I’m sure all businesses have their battles; it’s a fight to keep your business alive. But I’m sure there’s many ways to grow a business in corporative manner too. And I want my businesses to be like that.

Maybe I should view these “battles” as “negotiations” and opportunities to better myself at negotiating. It’ll be more meaningful a fight then!

I feel so happy about this. It’s no longer about the money but more of showing my debtor that I will not be pushed around anymore.

I was right about the hiring the debt collector. These people must have thought that we were pushovers and when we hired debt collectors, they simply handed the money over real quick. Money that was owed 4 months was simply paid up over 1 weekend!

This bad debt was money deemed as lost initially but the situation has turned around! It’s victory in my opinion.

I rather pay a the debt collector who are so much more deserving of the money than these unscrupulous businesses who take advantages of small businesses.

I’ve started a category on ‘Debt Collection’ on this site to share more about my experiences and the steps you can take to increase your odds of collecting back your bad debts. You can also view the category on the right side of this page. I hope this will be of help to businesses in the same situation.