Rather than just talk for half an hour about myself I tried to base the presentation around advice that I think has been particularly important for me in my business, and give them an honest and realistic account of what it is like to run a business. One of my points was to “work hard” but another was to “look after yourself” – to get enough sleep, exercise and eat properly. You are no use to your business if you try and work all night or don’t take time to get to the gym, go for a run or have a decent walk. Running a business, particularly at the start, is hard work and you should work hard, but balance that with enough time to recharge before you burn out.

Then, I read this post by Michael Arrington. I’ll avoid unpacking all of the nonsense, although I’m not convinced that the company behind Farmville are really “putting a dent in the universe”, and the programmer quoted in the article has already spoken out about his name being used to support Arrington’s argument. What I will say is that this is a horrible, horrible example of how to do business well. Glorifying bad working practices, expecting people to work ridiculously long hours and berating them when they object not only flies in the face of common sense but is an incredibly bad example to set. You can read Amy Hoy’s excellent post on the matter on her blog, Unicorn Free.

If you have a “startup culture” that glorifies long hours and complete dedication to your cause then you are essentially stating that you don’t want any person who has a life, any other interests or (heaven help them) a family working in your company. You rule out a lot of older people, really those over the age of about 25 or so, who have figured out that working all night isn’t something worth bragging about, you rule out anyone with a health issue or disability that makes working long hours difficult and in particular you rule out a lot of women. The dot com culture that I escaped to run my own business in 2001 was very much the same as the startup culture of today. As a woman with a small child, I needed to hot foot it out of the office every day at 5.30pm on the dot or risk annoying my lovely childminder, and not getting to spend a bit of time with my daughter. I quite frequently then worked at home after she went to bed – but then felt bad at work the next day hearing the team talk about how they had been in the office, “most of the night”. It was never said to me openly, but I always felt sidelined in that culture because I couldn’t be part of it as a single mum. There are of course fathers in the same position, either as single dads or as dads who take on the majority share of the childcare. However, due to biology, there is a certain amount of time where the woman is likely to be the one doing the majority childcare and so this kind of culture does effect women more than men.

Why is anyone encouraging this behaviour? I am all for hard work, I am all for putting in the extra hours when they are needed. If you are running your business well however, those late nights should be the exception not the rule. You are doing something wrong if you need to expect yourself or people working for you to work long hours as a matter of course. You will not get the best out of yourself or anyone else if you are exhausted and you will not attract experienced team members if you expect them to give up their entire lives for the company. There are other ways to do business. There are more sustainable ways, with less risk to your health and sanity, to run a company and develop a product. There are ways to bootstrap your products, and at least then if you are putting in the long hours you are doing it for YOU, and not to line the pockets of your funders.

As I explained to the young people on Monday, when I started the company it was just me, and it was a service business. It is very hard to scale a service business as you are swapping hours for money, adding an extra person allowed some level of scaling as the admin work didn’t double so the amount of billable hours we could work between us more than doubled. This allowed us to bootstrap our product, Perch, out of the income from the consultancy business. Perch is completely owned by us, and we’re sure that our customers will be pretty happy to know we aren’t looking to sell the business, that’s not our model. We intend to keep doing what we love – developing Perch, helping our customers and doing a small amount of consultancy and development work for clients – in places where we think we can really make a difference.

There are other ways to do business. I’d like to see the bootstrappers, the tiny service businesses doing great stuff for their clients, the parents combining business with a successful and happy family life, the small companies treating their employees with kindness and compassion held up as great examples – not those who think sleeping under their desk makes them better than the rest of us.

I may well be old-fashioned but it seems that setting up a business with the aim of an exit by way of a sale to a bigger company is unlikely to work out. Investors throw a lot of money at projects because they know that perhaps 1 in 20, 1 in 50 will pay out in a massive way. It’s a lottery – you might win, you’ll probably lose and have nothing to show for it in the end. For the investors it doesn’t matter – they win in the end when one of their 50 lottery tickets turns out to be a winner – however every person in every one of the failed companies loses. From the founders to the employees.

Making a thing and selling copies of it at a profit may not make you a billionaire overnight, however it can make you a nice income, may very well allow you to employ people and provide them with stable employment. You can own 100% of your company, and be truly independent. No investors pushing for an exit, no worries about where the next round of money is coming from. You make your thing, you sell it and with the money you make more things or improve on your thing. It’s slow and steady, but it works.

While this post has been sat in my drafts, I discovered that I’m not the only person who is concerned about this. Amy Hoy writes on her blog Unicorn Free,

I’m angry that it’s become an assumption that “success” means getting a big fat investment, not turning a profit. That success means founding your own company in order to determine your own destiny, then happily become an employee again when some megacorp snatches you up.

- The Truth about Success – Brick by Brick

Gary Vaynerchuk also recently posed the question, “Why is raising money celebrated more than making money?”

I don’t think companies funded by venture capital are always a bad thing. If you have a great idea, with a real roadmap to profitability, that needs a chunk of cash up front in order to put plans into action, then it can be really helpful. Many investments also come with valuable business help and input – which can be worth as much as the money for an early stage company with founders who have little business experience. However I am afraid that people with a business idea are heading straight down the investment track without considering if they can be profitable from the outset, bootstrapped by founders who then can own their entire company. When the bubble bursts, a lot of small, potentially excellent companies will go under with it, as they will be unable to survive without further investment which will be in short supply. The bootstrappers will probably survive, as they are growing within their profits and know how to live within their means as a business.

I don’t know a lot about the world of venture capital and investment. I know quite a bit about running a profitable business though, and while I love the fact that running a business is being seen to be a good thing, and something for young people to aspire to, I think we should be careful that we are not setting people up to fail. I’d like to see the bootstrappers celebrated, and seen as role models for young people. I’d like to see more resources and information for people who want to do that, more stories from those of us who have done that and are currently still engaged in the process of growing these businesses in a sustainable way. The big investment stories are far more newsworthy than, “small business launches new product built during evenings and weekends, while founders do other work during the day to pay for it”, however I’d like to read more stories like that. I’d like young people to see that they may have options rather than just assuming they need a big cash injection to pay for all the trappings of business, before they even get started.

I have agreed to build a website for someone – do I need to register as freelance?

Whether you are officially starting a business as your fulltime occupation or are taking on a few freelance projects in addition to your day job or studies, you need to tell the tax man (HMRC) that you are earning money on a self-employed basis. By doing this you let them know that you need to complete a tax return at the end of the year. You can register online on the HMRC website.

You will also become liable to pay Class 2 and Class 4 National Insurance contributions depending on the amount of profit you make in your business or freelance work. Class 2 contributions are currently charged at a flat rate of £2.50 per week which generally you will pay by direct debit. You will be liable to pay these from the time you register as self-employed unless your earnings fall below the lower limit and you have applied for small earnings exemption (see below). If you don’t set up a direct debit you will be sent a bill for these every 6 months. Class 4 contributions are based on your profits – so these are worked out as part of your tax return at the end of the financial year.

There is a useful guide to the basics available from Freelance Advisor.

I will only earn a small amount of money from this – should I still register?

You still need to register, however if you know that your earnings will be low you can register to be excepted from class 2 contributions. You must register, otherwise you will be billed for them. So if, for example, you know you are only going to take on a couple of freelance logo design jobs while you are a student you could safely register for the exception.

I’m a student do I need to pay tax?

Yes. If your income from all your employment and self-employment goes over your personal allowance. So if you have a summer or part time job, and do freelance work, all of this will be taken into account when you do your tax return. You will pay tax on the amount that goes over your personal allowance.

What records do I need to keep?

Keeping records is the most important thing you can do. If you have organised records then even if you struggle with your tax return someone will be able to help you out. You need to keep details of any money you earn through your freelance work – so if you send invoices this is easy. Just keep a copy of all invoices sent. You should also keep details of any money you spend that directly relates to the business. For example, if you buy fonts, stock photography, sub-contract some work to someone. This can all be deducted from the profit that you make on a job. You only pay tax and NI on profit, so you want to make sure that you are recording things that legitimately reduce your profit.

There are lots of online bookkeeping applications which make keeping records easy. I love Xero, and I also hear good things about Free Agent. You can do your invoicing, record expenses and keep tabs on profit and loss right from within these applications.

I would also suggest having a separate bank account for the business and transferring money as drawings to your own account. This just helps keep things simple and easy to reconcile.

What about VAT?

You don’t have to register for VAT until your sales (not profit) reaches £73,000 in a 12 month period. However you can register voluntarily. Once you are VAT registered you need to charge VAT on all of your invoices, and submit a VAT return detailing how much VAT you have collected – you then pay this amount. However before paying your VAT you deduct any VAT you have paid. This means that VAT makes your invoices more expensive, but this only matters if you are dealing with people who are not VAT registered.

So, if you provide services to businesses who are VAT registered, registering for VAT yourself will not make a lot of difference to them, and you can then claim back the VAT on anything you buy for your business. If you provide services to end users, who are not VAT registered then all your invoices are 20% more expensive once you have registered and they cannot claim this back.

Registering for VAT will also greatly increase the amount of admin you have to deal with – so you should factor this in to your decision to register voluntarily.

Do I need to register as a company? What is the difference between a limited company and just doing freelance work?

Once you have registered with HMRC as self-employed you become what is known as a sole trader. Some freelancers and small business incorporate as a Limited company. This makes a difference in terms of how your profits are taxed. You can make some savings on tax as a Limited company but it comes at a cost of more admin – and probably an accountants fee. Therefore generally, for a small amount of freelance income, you should stay as a sole trader as your tax is kept simple. If you are considering becoming a Limited company you will need to advice of an accountant to make sure that you are paying tax in the correct way.

Do I need an accountant?

If you are simply sending a few invoices and claiming some small expenses against those earnings then you should be able to complete your tax return yourself without the need for an accountant. Tax returns can now be completed online and HMRC will calculate how much tax you owe. So all you need to do is complete the form accurately from your records. This isn’t hard – the important thing is having all the records to hand.

An accountant becomes more useful if you are running a business as your fulltime job and have a large number of invoices and expenses to sort out – and especially if you are VAT registered, a Limited company, or employ people. An accountant will know what you may and may not claim against, and be able to let you know of any changing legislation that effects you and your business so is a worthwhile investment. I still do all the bookkeeping for edgeofmyseat.com however the accountant does our end of year return, making sure I’ve not done anything silly, and also lets me know if anything changes that I need to be aware of.

How do I pay my tax?

The deadline for filing your tax return is 31st of January. You can file it any time after the end of the tax year at the beginning of April, you will then know how much you need to pay. You need to pay this amount by the 31st January. So it is worthwhile doing your return as soon as possible as you then know how much you will need to pay. If you know that you are earning over your personal allowance you should put aside in a savings account enough money to pay your tax bill.

It is worth filing your return early as you may also be asked to make a payment on account – money towards the next years bill. This can come as a shock if you were not expecting it, so filing early will give you time to have the money available. If you are earning enough to be asked to make payments on account, you will make a payment on account on 31st January, then one 31st of July and the final payment the next January will make up the full amount of your bill – when you will also make a payment on account for the next year.

Wrapping up

Registering as self employed and keeping accounts can seem a bit daunting however it really is quite straightforward once you know where to look. My top tips are to keep good records, put money aside for your bill, ask about anything you are not sure of and file your tax return as soon after the end of the tax year as possible. If you have any other tips please post them in the comments.

I don’t understand something.. You build custom content management systems but your website is on wordpress??

Then going on to suggest I should be using Perch (our mini-CMS product) instead.

“wouldn’t it look better for your company if your blog was based on perch? Just a suggestion.”

It’s a reasonable point, why do I not use our in-house PHP framework or Perch here? One reason is that this blog is very old and predates by several years both of these things. However when – as has happened recently – a client comes to me with a proposal for a heavily blog based site, I often suggest WordPress over our in-house solutions because it’s an excellent tool if you need a site based around a blog, or where the blog is the main feature.

As a web development company we have tools we like to work with. We developed our own PHP framework because we were unhappy with the options available to us, and we can develop sites very rapidly with that as it is customized heavily towards the type of work we tend to do – very large, content rich sites with requirements for additional applications built in. The idea for Perch initially came from a very different in-house need – to have something we could use for very small sites that sometimes turned up. It ultimately turned into a product in its own right. Perch grew out of the realization that not every site needed a big CMS installation.

Sometimes projects come to us that are not a great fit for either of these tools. Sometimes the client is really pushing to use our framework – because they have used it before. However, as the experts we would be absolutely wrong to recommend the client used something for the project that wasn’t ideally suited for it. Even if it was the tool that we are happiest using. As professional web developers and consultants we have a whole toolbox full of tools, we don’t just reach for our favourite hammer.

The Law of the Instrument can be seen in every web discussion forum, on sites such as Forrst and on Twitter. Ask for a CMS, blog or framework recommendation and you’ll see people immediately leap in to declare their hammer the best, without any knowledge of the requirements at hand – sometimes even when the requirements really rule out that tool from the outset. As sellers of a CMS product ourselves we sometimes benefit from this – however we’re the first to jump in and point out if our software isn’t the best fit, as we don’t want an unhappy customer who bought the wrong tool for the job.

If you are developing websites, make sure you have more than a hammer in your toolbox. Take a look at what else is available, try it out on your own projects, and be sure that you are not forcing everything into the same shape due to only ever working with one tool. If you develop products then you should absolutely be eating your own dogfood and using those products – but only if they are appropriate for the task in hand.

If you define yourself as a mumpreneur, why do you do that? It seems to be implying limits for your business from the outset. Limits on how serious you are as a businessperson, how large your company will be, the hours you might work. I know many men who manage to run businesses while still doing a large share or all of the childcare for young children, they are not labeling themselves dadpreneurs. They are men who run businesses and are also dads. Their children may well define the hours they work and what they can do at the moment but they don’t seem to need to label it in the way women often do.

I started my company as a single mother, with a daughter who was only in pre-school in the mornings. I supported myself and my daughter financially from day 1. I made no secret of the fact I was a mother although many of my clients would probably have be surprised at how much of their work I completed late at night once my daughter was in bed. However my status as a mother or as a woman has not defined my business. Equally relevant are my personal values, the things I think important and the other facets of my life. My only recently overcome fear of public speaking has probably been more relevant than anything else in the opportunities I have and haven’t taken up as a business owner.

The thing is, even if your reality at this moment is that you are a mother of small children who need you, this will change. Your reality today is that you can only work between 9am and 3pm and a bit in the evening, your reality is worrying about schools and not going to meetings with milk stains on your shirt, this will change. In the blink of an eye it will change and you’ll have self-sufficient teenagers whose main concern is if you will pick them up from a friend’s house on Saturday morning. Will you want to be defined as having some sort of mummy business when your kids are big enough to take care of themselves? Will you be able to change that label you assigned to yourself and your business then?

Shaping business or work around family or anything else is a great idea. Making choices – such as that you are going to try and always be there after school for your children – is excellent. Labeling oneself, especially in a way that implies limits, does not seem such a great idea as especially where family life is concerned things change very quickly and we change too.

StartUp Britain is designed to make it easier for new companies and innovations to flourish and encourage people who aspire to start new businesses to work for themselves.

So, how are they going to do this? Apparently by giving us a list of links to other websites, including Australian “design competition” site 99designs because, as we all know, branding is simply about creating a logo. There is no context to these links, clicking on any one of the 4 “Top Tips” just takes you straight out to another site. Have these sites paid for their inclusion here? Or are we to believe that 99designs is precisely where the business owners behind StartUp Britain will be heading to brand their next venture?

What value does this offer? It may be that for some types of business a cheap and cheerful logo from 99designs will do just fine. However for many it will be money completely wasted and may be harmful to a fledgling brand. Why is this site not giving realistic advice and why is it not supporting UK design and branding agencies? Is there a place in StartUp Britain for them?

I’ve picked on the 99designs issue because it is indicative of the lack of substance behind this venture. We are told there is lots more “coming soon” but why launch this initiative with such fanfare with nothing to show for it than a list of links and a few special offers provided by businesses who generally provide those offers to new customers anyway?

I know about starting a business on a shoestring. When I set up edgeofmyseat.com I had £1,500 to my name, provided by way of a grant and loan from The Prince’s Trust, however the business support I received from The Prince’s Trust was more valuable than any monetary help they could have given me. When you are assisted by the Trust to start a business, they don’t just hand you some money and let you get on with it. For three years I had regular meetings with my business mentor. I was expected to have up to date accounts, cashflow forecasts, to be able to demonstrate how my business was developing. In return I was helped to get a business bank account, given practical advice on budgeting, on using contractors, writing contracts and so on. Practical, down to earth advice. It isn’t sexy or exciting but it’s the dull stuff that ensures a business can survive and be profitable.

I started edgeofmyseat.com as the dot com bubble was bursting, in a landscape of disillusioned and unemployed web designers and developers who had been sold a dream backed by venture capital, and the money had run out. I can see a lot of the thrill of the dot com days in the excitement of the new wave of internet start-ups. I’d like to see all those great ideas given business advice and help that has substance, that tempers the excitement of launching a business with the need to understand how it will become profitable. I’d love to see the UK become somewhere that businesses can flourish and do well, but I think that the team behind StartUp Britain have some way to go to convince me that their plan is anything more than a token gesture towards business owners.

Update: Since writing this I have seen some other excellent posts on the subject. From PostDesk, Why “#StartUpBritain” is nothing more than a government backed link farm and more on the 99Designs issue from Elliot Jay Stocks in a post entitled Clueless.

Perch is a content management system developed and sold by my company, edgeofmyseat.com. It is a self-hosted CMS, so after buying a license for £35 (+ VAT if in the UK/EU) customers download the code and install it on their own server. The payment is a one-off with no monthly charges and includes support, updates to future dot releases of that version, and a growing number of free add-ons available from the site.

Why not offer the product for free and charge for support and/or plugins?

Every so often we encounter someone who is outraged that we charge money for a Perch license, astounded that we would like to earn money for our work. We could have released Perch as a free product, but unless it is making us money we wouldn’t be able to justify company time spent developing and supporting it.

Obviously there are products that have done very well as open source, free to download products but these companies have to make money somehow. A common way is to charge for support, however we think that the charging for support model is a really bad one – for the customer. A Perch license includes support, if you take a quick look at our support area you will see that the support offered quite frequently goes way above and beyond just basic installation help. It is in our interests as a business to try and “design out” of Perch, and the Perch documentation, support requests. If we can add some additional help or refine a confusing interface and prevent a bunch of support requests we make each license more profitable. If we make our money by selling support then it is actually in our interests as a company for the product to need support! We would much rather spend our time writing code and help resources to make customer’s lives easier – than supporting people who are frustrated – so the pay for support model was always a non-starter for us.

There are also products on the market that have a free basic, core product but then you pay for plugins to make the product more fully featured. We didn’t want to go down this route for a few reasons. Firstly, we want to make the core product as fully-featured as makes sense for a “light” CMS. We didn’t want to be making decisions about chunks of functionality – should x be part of core or should people pay for it? We want to develop the product in terms of what makes sense for the product, not with one eye on how we monetize features. Secondly, we wanted it to be clear what people pay when they decide to use Perch for a site. You buy a license and that is it, you can then download our add-ons as and when you need them without paying additional charges. If we did things the other way round and offered the core free then charged for add-ons we would be having to say to people in support that they needed to buy X, Y and Z to do what they wanted and the cost to the customer starts to creep up, and isn’t clear from the outset.

Why not offer a multi-site license?

The most common request we get is for a multi-site license, “buy once, install as many times as you like”. We didn’t go down this route because firstly it would make the base price far more expensive. Everyone buying it would be buying the ability to install it many times – what if you only have one site to use it on, or don’t know how you and your clients will get on with it? In addition, we feel that this model is again bad for the customer. Once a customer has bought a license, we wouldn’t see any more money from them. We might need to support them through every install they do, without any additional license fees. If a customer pays a small amount each time they buy a license, the incentive is there for us to keep that customer happy through each install in the hope that they will come back to buy a license next time they have a site to do – rather than going to our competition.

There is a final reason why we don’t like the multi-site idea and that is that the license then follows the developer. As most Perch customers are design agencies, buying a license on behalf of their client, the license per site model works very well. If the end client wants to move their site to another agency they are able to move their license as well – it isn’t tied to a multi-site license held by the agency. So it ties in nicely with the transparent way we like to work at edgeofmyseat.com – essentially we’re licensing Perch in the way we like to deal with licensed software for our clients.

Why not offer a free version for personal use?

Perch has an online demo but no free personal, non-profit or trial version. This was a deliberate decision on our part and in addition to the usual concerns in terms of protecting our intellectual property it really comes down to our aim to offer exceptional support to all of our customers. If you have a tier of free users of your software or service, the paying users are essentially paying for their support – and in the case of hosted products their bandwidth and resource usage. To offer any kind of free version would mean making paid users pay more, in order that we could afford the time to support all customers.

Almost two years on we haven’t changed the pricing model that we set out with, as we still feel it was the best decision for the product. To some degree, having never launched a product before, some of those decisions were based on what felt right at the time, and the way that we like to work with clients in the service side of our business. It has been nice to see those initial hunches pay off so I thought that discussing some of the thinking behind our choices might be of interest to other people making these decisions. As always, I’d love to hear your comments on pricing models for downloadable software and software as a service. What works for you as a customer, or as a seller?

At edgeofmyseat.com we have always avoided hosting for our clients, the following reasons are why I generally believe reselling hosting to be a bad idea for small agencies.

Supporting hosted clients

Supporting clients who see you as their host can use up a lot of time. Will the money you make from reselling cover the additional hours of support and assistance?

If you are taking money for a service – providing hosting – even as part of a package of services you offer to your clients, then you take on the responsibility of ensuring that service is up and running, and solving any problems that the client has. As a reseller though you have no control over how reliable the service you resell is. If it is frequently down the compensation you will get from the host will be little to none – and yet you will be spending your time responding to upset clients with nothing you can actually do to help other than put in a support request yourself. As your clients will expect their sites to be up 24/7 you need to be happy to deal with these support requests at any time of day or night.

By taking on hosting you potentially end up becoming the go to person for all kinds of issues unrelated to the website. If you are a Mac user will you be able to help out a client who is having trouble with Outlook on their PC? If you provide the hosting and it includes email, you will be their first port of call when they can’t get their settings right.

Chasing small invoices

For many projects, especially those where the client has some kind of Content Management System to do their own updates, the designer will deploy the site and then not need to do further work on this site for some months. If you are billing these clients monthly, you will be bound to have some who delay paying for as long as possible or will only pay when chased. The cost to your business of chasing small invoices can be huge.

Updating and securing servers

Unless you are confident that you can solve most issues yourself with your server, or have truly excellent support from your host, then reselling hosting may cause more trouble than it is worth to you financially.

If you are not a systems administrator then it is likely you will have taken on a dedicated or virtual private server with some management software installed – something like Web Host Manager. Your host will provide the server with WHM installed and then you use WHM to generate sites including email and other features as needed. This all works really well, except that with many hosts you will be expected to do updates and apply security patches yourself. If you run into any problems then – once again – you will need to put in a support request to your host and wait, while pacifying annoyed clients.

Terms of Service and Insurance

If you are reselling hosting you should take advice on the terms of service you offer to your clients and whether your business insurance will cover any claims arising from a client believing they have lost money due to the hosting you provide being unavailable. This is going to be different depending on where you and your clients live, however if you do or are considering becoming a reseller I strongly advise you check this out to make sure you are covered.

If you intend to “switch off” non-paying clients this should also be detailed in the terms and conditions that they agree to. You should ensure that in taking that action against a client they have no way to come back with a claim that you have damaged their business.

It is also worth having a policy in place in terms of what happens if the client wants to continue with you as a designer but move to new hosting, or stop using your design services but keep the hosting. Would you be happy giving access to a site on your server to another designer, for example?

What can you do instead?

If you are pitching for jobs where part of the requirement is hosting, this doesn’t mean you should feel you have to offer hosting yourself. When I put in proposals that require hosting, I detail the costs for the hosting at a preferred supplier of ours (we like to use Memset). I will spec out the type of server, and the monthly or annual costs, and include this in the proposal. As we tend to put clients onto Virtual Dedicated servers I will also indicate the extra options that the client may or may not decide to have – such as firewalls, fully managed support and so on. The client then can make the decision about what they feel they need. They can also decide to go with an equivalent host of their choice – as long as it meets the minimum requirements for the application we are developing. This puts responsibility for that decision in the hands of the client – and although most will go with our recommendations they get the chance to check out the host themselves.

We are always happy to become technical contact for the account on behalf of the client, so they don’t need to deal with setting up a VPS or getting their site configured or even liaising with the hosting technical support if the box is fully managed. Once the site is up and running if the client sees that the server is down they can directly contact the hosting company, and utilize the 24/7 support there, rather than having to wait to get hold of us during office hours.

If you like the idea of getting something for hosting, some hosts have a referral scheme that will enable you to make money from hosting without ever having to operate as a host yourself. It goes without saying that you should only recommend a company you are happy with, but if you find a great company and they are willing to offer you credit against your own hosting or cash for accounts you put their way – then everyone wins.

What about allowing clients to preview sites?

When I have discussed this issue in the past, one argument for hosting client work yourself is that you can allow them to preview the site, but as they don’t have access to the server they can’t take it and not pay the final invoice. Disregarding whether you should be working for such scoundrels, if you do have these concerns – or just want to be able to demo work before moving it over (for example they have an existing site in place) then taking out a staging server of your own is a sensible step.

We use a Miniserver box at Memset as a staging environment, so we set up a subdomain for a project on that server and allow it to be tested there. As this server matches the environment most of our projects are hosted on it is a good way for the client to test. Quite often they populate all their content into the CMS on staging and we just migrate the entire database and folders of assets over to their server once they are ready to go live.

Personally I like transparency in dealing with other services used by our clients. I feel that it saves us from ending up in potentially messy situations where we are seen as providing a service that then fails for reasons outside our control. Would love to know other experiences of reselling – perhaps it works really well for you? Let me know in the comments.

However for many companies paying as late as possible appears to be company policy. Websites such as Pay On Time have lots of excellent advice for getting paid as quickly as possible. For example sending an initial invoice, then a statement before that invoice is due, sending a reminder when it becomes due, then another when it is x days overdue, visiting the client or phoning their accounts department. All of this to receive money for work that your company has already done, to terms that were agreed beforehand. What a phenomenal waste of time! Large companies have people who spend their days dealing with this nonsense, for small companies and freelancers it is usually the business owner who spends their time chasing people who have no intention of not paying, they just want to wait as long as possible.

Some large companies have very fixed accounting procedures, which is fine if they are up front about this from the outset and we know when and how to submit invoices, and can decide if we are happy to work under those terms. However, more often the accounting system is used as an excuse once payment is already late. Also, this is 2010, if your accounting system means that everyone you pay has to wait 60 days while their invoices crawl through the system, there is something seriously wrong with that system.

If the work is being done by massive company X for massive company Y then it is likely that those doing the work have no idea that invoices don’t get paid for 60 days, however if your company has a policy of late payment, here is something to think about. If you use small companies or freelancers then the person who will be chasing up unpaid invoices will often be the same person who is doing the actual work. Next time you ring with an urgent job that needs doing – will that person be remembering their wasted hours chasing payments from you? By paying on time you demonstrate that you appreciate the work of your suppliers, and become a more valuable client, making it far more likely your work will be fit into busy schedules.

Is this just a UK issue – or is late payment culture as common in the US, Europe or other countries around the world? Or are you a business owner who can give me a reasonable argument for paying suppliers late?

When reading customer testimonials on websites I sometimes wonder how genuine the words are. There is often no way of knowing whether the quote even came from a real person, whether it was unsolicited or how old it is. As a business owner you have to keep these testimonials fresh and remember to request new ones from customers and clients. Despite these problems customer testimonials feature on many sites and can really help to reassure people before they purchase.

When we launched Perch, just over a year ago, we used Twitter extensively to get the word out and to respond to our potential and new customers. Drew and I have been using Twitter socially since not long after it launched so it made sense to promote Perch that way. As people started to buy and use Perch, they began to post nice things to Twitter and so we added them as favorites for the Perch account on Twitter, over time building up a large list of nice comments from our users.

When we launched the recent redesign of the Perch website we used the Twitter favorites as a way of putting testimonials on the site. In the footer of the Perch website is one of our Perch birds tweeting a tweet drawn from that list. These display randomly, so as a visitor moves around the site they will see a variety of different testimonials. Each tweet links through to that status on Twitter – so the testimonial is verified as being from an actual person. On Twitter you can see the date it was posted, so it is possible to tell how old this testimonial is. In addition the visitor is able to click through to the grabaperch account or search and see all of the mentions of Perch – not just the ones we really like!

You can get your favorites from the Twitter API. What you should avoid however is having something running on your site that gets the favorites every time someone visits. Instead, use the API to pull back the favorites and store them locally (in MySQL, another database or a text file) and then display your latest or random favorite from that data store. Twitter is often unresponsive or very slow and that will effect your site if you do this in real time.

Using the favorites list to add content to your site gives you a very simple way to add moderated Twitter content to your site. High profile sites have had problems in the past by displaying content based on a hashtag, as then anyone using that hashtag can get their thoughts displayed on your site. By using favorites you keep control and choose what goes into the list. Although you have chosen which Tweets go into your favorites, the visitor can use Twitter to find out more about you and the person providing the testimonial. This is a very open and transparent way to display testimonials and I believe this makes them far more useful to a potential customer or client.