101 reasons to QUIT

This haunt me every minute of my startup journey, a little voice in my head that keep telling me "Maybe it's time to quit" and it will come up with reason why quitting make sense. This escalated recently as I realize my company financial growth and how it affect my personal life.

This is a tough fight as the idea of going back to the corporate world is too attractive. However, looking back at how far I've come, it doesn't feel good to go back to comfort zone. So I am stuck with this dilemma. 

The only thing that is keeping me moving is a strong enough purpose. The purpose got me to where I am today and I hope it will bring me down further. 

We have to trust that things will work out and opportunities will present itself. I hope I make it through this tough period. 

Contractor vs Employee

I have been troubled by this decision for as long as I can remember, mainly because I want to balance Cost and my company reputation. You see, this decision is very important especially for a startup as we have very little margin for error.

Below are my thoughts process when it come to "Contractor or Employee" decision:

Contractors

Pros:
1) They are expert in their field, so require less training
2) Cheaper compare to employee as we don't have to pay them if there are no job for the day
3) Most contractor are self-employed so they are highly motivate to complete the job efficiently
4) Contractor can be held accountable should there is any incident on the job

Cons:
1) Difficult control quality of product or service, as they might just want finish the job and move on
2) They can bail on you as they can choose to give up your job and proceed to other job that paid off better, therefore not good for long term

Employee

Pros:
1) Easier to control quality of product and service as your employee adhered to your company quality standard
2) Employee cannot bail on you as long as you paid them on time
3) Once trained can be retain and work for you long term

Cons:
1) Much more costly as we have to factor in CPF, medical benefits, annual leave and incentives
2) Require training before taking up the appointment
3) Company will be held responsible should the employee have any mishap

After much thinking I decided to go with employee mainly because I value my company service quality more than the cost-saving provided by contractor. What's the point of saving some cost but we end up losing sales in the long run due to poor service quality.

I am not saying all contractor are poor in service, but we are unfortunate enough to dealt with a handful of contractor that did not perform well.

So I guess my next step of expansion is to employ some staff and hopefully I get to learn some human resource management lesson which I can share here.

Customer! You are FIRED!

To a startup, every customer is important. Because we need the revenue to keep our company going and growing. However, recently I have a privilege to do De-Marketing otherwise known as firing our customer.

It is not the most pleasant experience I would say as I am worry about what kind of damage my company might take. But after thinking through it, I believe I have make the right move and here's why.

Most of the business book I have read always teaches one rule, the 80/20 rule. This rule represent 80% of your revenue coming from 20% of your client base. Which means we should focus most of our energy on this 20% to ensure they keep producing the revenue.

One of the incident that happen to us was we were trying to keep this customer happy by adjusting the package that we are offering. We adjusted the price, structure and delivery method but no matter what we do they still have the thinking that we are cutting them short. This goes on for weeks and we have done a few job for them at a loss in hope to keep them. After awhile I realize this is not worth our effort, we are not getting paid what we are worth and we have spend way too much time which can be use better to serve other customers who believed in our mission.

So I went on to "Fire" some of our clients and below are a 2 strategies I used:

1) Increase price/surcharge

This is probably the most effective one of all especially when demand for your service is high. Customer who value your product and services don't mind paying a bit more if you can solve their problem. Most importantly it filter off those customer who is just looking to bargain you down because you are a startup.

2) Reject orders

This is encouraged if you have high supplier bargaining power, otherwise you will just look like an arrogant company if you apply this strategy wrongly. They key to this strategy is prioritize, let the customer off slowly and give legit reason why you cannot fulfill their order. For our case, we do transportation and time is sacred so we prioritize by giving time slot first to our key clients and new customer. Then we reject orders only if we are genuinely fully booked. This strategy require some patience but after being reject a few times, the customer will usually look for alternative.

I think the most important lesson here is not to sell less than you believe in even though you are a startup. If a customer don't believe in the value you are providing, move on. There are a million customer out there and the key is to find your niche, this way your effort will be leveraged and you can too get 80% revenue from 20% of your client base.