Should I close the business?

So recently I began a small relationship counselling business.

It's always been something in the back of my mind. I guess it was a version of the grass is always greener on the other side.

I am employed as a counsellor, but always had the idea of private practice.

The only problem is now that I've started doing the whole private practice thing... it kind of blows :p

Here's the CON list:

(1) Clients can be hopeless with coming to appointments, so there are many times when you get ready 30 mins prior to the appointment, and then wait around for 20 mins for a no show. (By the way if they do this twice I ban them from the practice).
(2) Insurance, accommodation, and advertising will lose me $200 per week. If I only get $80 per hour long appointment, and it takes me 30 mins in setting up the appointment and getting to the office etc... for each appointment, then I'm working 4 hours per week just to break even. Right now I only get 1 or 2 clients per week, so it's a loss.
(3) I thought the relationship counselling would give me something different to my normal counselling job, but it's really just much of a muchness. It doen't excite or interest me like I thought it would because it just feels like the job I'm already doing.
(4) With working for an employer compared to running the small business, I can no longer just leave my work at work. The small business shoves work into my down time as well. You never get totally free from work responsibilities.
(5) The energy I put into this business is energy I take away from my property investment projects...which make me more money for less work and create a passive income.
(6) Even if the business becomes a success, then I'll never get the chance to have a holiday because I'll always have clients booked in.
(7) Banks will be more likely to lend if I continue my day job getting approx $80K per year than trying to get income from a small business.

Pros
(1) Potential to grow the business to replace my day job. But this has the above associated cons.
(2) I haven't yet tried google optimisation, I know someone that could get me to the top of google for $100 per week, but haven't engaged their services yet. So I could potentially grow my business a heck of a lot with the right advertising.
(3) The business could potentially become passive income, if I grew it enough to then be able to employ other counsellors and take a cut of their earnings.
(4) I could potentially charge closer to double what I currently charge per session once the business is established.
(5) The price of doing business is only $200 pw so it's not overly high...
(6) With just 20 clients per week, at a full price session of $150 per hour, I could make $2800 pw profit. That's $145 600 per year. So it would be potentially a good income.

The alternative is that I keep doing what I have been doing, and what I already know works well. Each rental property I purchase and set up correctly makes me between $200-$400 per week profit. In another 2 years I will have about $1600 per week profit from rental income. Add captial growth of say 3% per year on my portfoio and you'd be looking at another $1153 per week. So that's already $2753 per week that property will be making me, and it will have taken 5 years of work to set that up, however it will be passive income after that.

So the $2800pw profit from the business sounds good, but it involves approx 30 hours of work per week. Compare that to putting my efforts into property for the next 5 years to again create that $2753 pw profit...which will be passive income requiring very little ongoing work.


So what to do?

Fold the business now and focus my energy on property investment as I know that works for me?
Or give the business a good solid crack and see how it goes?
 
I think only you can answer your question, but...

I owned and ran a dog grooming business in my early 20's and when I wanted to take leave i would mark the time in my diary and book appointments around it. I would often groom dogs on a fortnightly or monthly cycle so with good planning I was able to schedule appts around it. Clients were understanding too, even more so when I took 3 weeks 'off' to get married.

For your no shows, send a text o4 call 5o confirm appt day before or morning of. Have a cancellation policy. I have monthly massages and I get a text message day before asking to reply with Y/N for appt and a link to the cancellation policy (which I haven't actually read).

What do you enjoy more - the investing or counselling?
 
Some more pros:
* You're in control of your own destiny. Don't discount the emotional value (can be a pro and sometimes a con) of working for yourself instead of someone else. Never write another resume (replace it with endless marketing).
* You're potentially selling yourself short if you're aiming for $145k p/a. As you mentioned, it can become a passive income if you start to employ others.
* If you do it right, a business should be an asset with intrinsic value that you can sell. You're not just earning an income, you're building an asset with real value.
* You can define your working hours. Most self employed work long hours, but you don't have to. It can leave plenty of opportunity for other investment.

Would you kick yourself in the future for not trying hard enough to make it work?
 
You say you began the business "recently".

Most businesses take a while to establish. Have you given it long enough to decide whether to continue?
Marg
 
Hi Tim, it sounds like *maybe* when you started the business, your expectations were a little unrealistic? Only you know that. Generally speaking, a business takes a couple of years to hit a break even point. Building a reputation takes time.

Even so, you need to ask yourself 'Are you passionate about the business?' If not, it's probably a good idea to consider what it is that you are passionate about and focus on that. No point wasting time doing something if your heart isn't in it, when you could be doing the things that you love.

I would recommend you read the book 'Good To Great' by Jim Collins and pay particular attention to 'The Hedgehog Concept'. I just recently read this book and it really gave me a new perspective on my own business.

Lastly, if you decide to fold the business, don't feel bad about it. You took a risk and did something few people have the courage to do. It might not feel like it right now, but simply giving it a go is something to be proud of.
 
Hi Tim, it sounds like *maybe* when you started the business, your expectations were a little unrealistic? Only you know that. Generally speaking, a business takes a couple of years to hit a break even point. Building a reputation takes time.

Even so, you need to ask yourself 'Are you passionate about the business?' If not, it's probably a good idea to consider what it is that you are passionate about and focus on that. No point wasting time doing something if your heart isn't in it, when you could be doing the things that you love.

I would recommend you read the book 'Good To Great' by Jim Collins and pay particular attention to 'The Hedgehog Concept'. I just recently read this book and it really gave me a new perspective on my own business.

Lastly, if you decide to fold the business, don't feel bad about it. You took a risk and did something few people have the courage to do. It might not feel like it right now, but simply giving it a go is something to be proud of.



See that's the thing. I used to be really passionate about counselling. But since doing it for the past 5 years it's now just become a run of the mill day job. I still love my counselling job with my employer, but I find some of the negative aspects associated with running your own counselling business spoils it somehow. A big one is that you can't just leave things at the office, you have people texting you in your down time as well. For example today at work I had two sucidal kids that I counselled, and when I walk out that door tonight I won't think twice about it. You do your 8 hours, then you're free :)

I find the thing I'm getting really passionate about now is property, and renovating. When you aren't rushed, renovating/building can be awesome. You pick a job you want to do in the morning, and you do it, you have a couple of beers while you work, you listen to music, you have lunch with the wife, etc... and then at the end of the day you have something awesome to show for it.

Hmmmm I think you might have hit the nail on the head. It's not really about all the figures when comparing the two options, it's just that I'm more passionate about something else.

Literally the new house I'm doing I could keep one of the rooms as an office for my business, or I could add a kick *** ensuite/walk in robe to the adjacent room by opening them up. It would get me an extra $50 pw rent for that room. And I'm much more excited about that idea of making a kick *** master suite in a rental property than I am about the idea of using that space to run the business from...

Reno's/building has it's cons as well, but that seems to be where my motivation/energy is pushing me...
 
I think you forgot the biggest Pro of all.

i.e. Learning and gaining skills through the experience of all associated activities required for running a business, facing challenges and overcoming them, dealing with all sorts of people from all walks of life and understanding what work when dealing with them, putting in the hard yards when they are needed most to break through barriers and reach the next level, feeling proud and content when you've built something from nothing when it all works out in the end due to your perserverance and persistence from sticking to the plan and never giving up, coming out a better person than when you went in, becoming totally transformed as a requirement to succeed in your venture with no rules or boundaries to direct you which way to go, but you must find the way on your own.

This, in my opinion is the greatest reward.
The money is good too :)
 
Some more pros:
* You're in control of your own destiny. Don't discount the emotional value (can be a pro and sometimes a con) of working for yourself instead of someone else. Never write another resume (replace it with endless marketing).
* You're potentially selling yourself short if you're aiming for $145k p/a. As you mentioned, it can become a passive income if you start to employ others.
* If you do it right, a business should be an asset with intrinsic value that you can sell. You're not just earning an income, you're building an asset with real value.
* You can define your working hours. Most self employed work long hours, but you don't have to. It can leave plenty of opportunity for other investment.

Would you kick yourself in the future for not trying hard enough to make it work?

-See in a way I would still be running my own business with the property investing/reno's/building, so all those pros you outlined are still valid.

The only scenario I can really think of where I would kick myself in the future for giving up this counselling business, is if I lost my day job and didn't have the business to fall back on. And that's only because it's easier to fall back on that business rather than property investing...as property investing requires a source of income for servicability, so you lose the day job, you lose the ability to continue with your property investing. But even that's only up to a point, eventually the property investing becomes self sufficient and new investments can be financed from the proceeds of previous investments.
 
I think you forgot the biggest Pro of all.

i.e. Learning and gaining skills through the experience of all associated activities required for running a business, facing challenges and overcoming them, dealing with all sorts of people from all walks of life and understanding what work when dealing with them, putting in the hard yards when they are needed most to break through barriers and reach the next level, feeling proud and content when you've built something from nothing when it all works out in the end due to your perserverance and persistence from sticking to the plan and never giving up, coming out a better person than when you went in, becoming totally transformed as a requirement to succeed in your venture with no rules or boundaries to direct you which way to go, but you must find the way on your own.

This, in my opinion is the greatest reward.
The money is good too :)

See again so many of those pros would still be achieved when just putting my efforts into property.

You wrote: "dealing with all sorts of people from all walks of life and understanding what work when dealing with them". That's one element that I wouldn't get from proprety investing, but it's one I already get from my day job.

I don't think I would want to leave my day job unless something drastic changed where I work. It's such an awesome job, and awesome place to work. They even let you cut down to 3 days a week. So I'm tempted with the idea of eventually cutting back to only 3 days a week and spending the rest of my time doing property. Until eventually I decide to retire.
 
But see the annoying thing is, if I think about it, I probably could get passionate about doing the business too. So do I just stick it out for now, give it a proper go, get the right advertising set up, etc... and then when I'm getting more and more clients and things are set up and flowing easier, do I then judge whether or not it's something I'm really enjoying and want to continue.

Sorry I've been back and forth on this one for a good month or more now. It's doing my head in. Lots to consider.
 
A psychologist I know said that when you have an either/or problem, toss a coin. When you see the answer, you will be either excited or disappointed, which will reveal your true feelings.
Marg
 
I find the thing I'm getting really passionate about now is property, and renovating. When you aren't rushed, renovating/building can be awesome. You pick a job you want to do in the morning, and you do it, you have a couple of beers while you work, you listen to music, you have lunch with the wife, etc... and then at the end of the day you have something awesome to show for it.

Maybe stick with the business for a little while longer, if it doesn't get any better, then drop it like it's hot and focus on property.
 
See again so many of those pros would still be achieved when just putting my efforts into property.

You wrote: "dealing with all sorts of people from all walks of life and understanding what work when dealing with them". That's one element that I wouldn't get from proprety investing, but it's one I already get from my day job.

I don't think I would want to leave my day job unless something drastic changed where I work. It's such an awesome job, and awesome place to work. They even let you cut down to 3 days a week. So I'm tempted with the idea of eventually cutting back to only 3 days a week and spending the rest of my time doing property. Until eventually I decide to retire.

People get different benefits from different things.
From personal experience of being in business and property/development for the last 10 years, I know that the skills and qualities learned from business has been about ten fold vs being involved in property, and I am quite passionate about property.
But that's from personal experience and it is not the same for everybody.
My point is that I believe you would get a lot more value out of business than property, but business is not for everybody.
 
Dump the business and focus on property.

You don't sound anywhere near committed enough to make the business work.
 
To look at it from the other side if I was a client of yours and could see that your heart wasn't in it and you were just going through the motions then that wouldn't make me feel all that comfortable or want to continue with you.
 
Give it time Tim - nothing worth having comes easy.
Most businesses become profitable within 3-5 years.

It's difficult to implement systems that can help leverage your time at the beginning.

My own business was the most difficult in the first year - we started off absolutely passionate and on fire. 50 properties were impossible to manage - not enough revenue to employ staff, not big enough for automation, very tough period.
We pushed through.
It became a cookie cutter, system based breeze after 150 properties. Big enough then to implement strategies.

If you decide to stay, then expect an uncomfortable period and expect some financial setback initially.

If you love what you do then people need you and you can both develop yourself and help others through your business.

Why give up something you are good at and love doing?

Like a relationship - stick with it, work through it, it is worth it at the end :)
 
Lots of really good advice from everyone, thanks.

Ive been considering everyone's perspective.

I think what I've settled on is giving it a proper go with proper advertising etc...

The place where I currently have the office is costing me $180 pw lost rent. But in about two months I'm moving it to a new place which will only cost me $40 pw lost rent. So I think that will help.

I think I've just worn myself out lately and trying to find the energy for the business has been difficult. Especially at the early stages when it's a lot of work with little reward. But I'll stick at it and see how I go. I should have a month or so coming up before the next Reno/building project, so I can slow down a bit and regroup.
 
I haven't yet tried google optimisation, I know someone that could get me to the top of google for $100 per week, but haven't engaged their services yet. So I could potentially grow my business a heck of a lot with the right advertising.

Are you sure about this?
There'd be a tonne of competition in your industry, but if you can get to the top ranking in Google for $100/week, that's a golden ticket and you'd be crazy not to do it.
However, you'd probably need to hire a receptionist immediately to filter all the enquiries and prioritise your appointments as you'd likely be booked out, provided your online material and sales skills are up to scratch.
 
Are you sure about this?
There'd be a tonne of competition in your industry, but if you can get to the top ranking in Google for $100/week, that's a golden ticket and you'd be crazy not to do it.
However, you'd probably need to hire a receptionist immediately to filter all the enquiries and prioritise your appointments as you'd likely be booked out, provided your online material and sales skills are up to scratch.

My brothers an electrician and the google optimisation guy got him as the very first match on google for electrical work in his entire area. So I think he should be able to get me at least close to the top. He usually charges a lot more but he is mates with my brother so is doing a massive discount.

Will be interesting to see what happens if I do rank higher.
 
Back
Top