Start a Business
Providing Telephone Services

(Last updated: April 24, 2010)

This page shows how to start a business providing various telephone services.

Use this information together with the Business Plan for Simple Services page.

The methods and procedures described on this page can be used to help satisfy your needs, and the needs of likely customers.

Here are the topics:

Introduction to idea
Estimated startup costs
Putting idea to work

Other useful information

The Vital Guidelines for Novices page helps beginners who want to start a business. These guidelines provide focused advice and useful insights.


IMPORTANT

Before using this information to start a business be sure to read the following notice: Disclaimer

Introduction to idea

This topic provides an overview of the business idea so you can decide if it suits you.

Basic idea

People or business firms pay you to provide telephone services. These services could be one or more of the following:

  • Answering service
  • Reminder service for important dates, such as anniversaries, birthdates, graduations, and weddings
  • Singing the Happy Birthday song for family members and friends
  • Wake-up service

In this time of impersonal, computerized communication, people appreciate being able to talk to a real live person.

This is an indoors activity that can be performed year round.

Suitability of idea

This idea is best suited for people who favor social activities.

Skills and equipment required

Primary skills -- You should have a pleasing personality and voice. Also, you must be dependable and punctual.

Primary equipment -- You need a telephone, preferably a business telephone in your home office. It would be desirable if this telephone allowed unlimited long-distance calls at little or no cost.

Other equipment -- As part of a basic home office, I recommend the office equipment described in the following topic

Profitability of idea

In order to show a profit, you would have to sell enough of your services to cover the startup costs and operating expenses. The more fees you collect over a certain time period the larger your profits. Therefore, you want to have substantial sales, along with low startup costs and operating expenses.

The fees you charge pay for your time and your ability to provide the desired services in a dependable and punctual manner.

The amount you can charge depends on how well off the customer is and how anxious both you and the customer are to make a deal. The economic conditions in the customer's local area might also influence these negotiations.

See the Setting the Sales Price page in another section for more detailed information.

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Estimated startup costs

This topic discusses the estimated startup costs for this business idea. Startup costs are what you need to pay in order to be ready to begin business operations. The amount of these costs also helps you decide if the idea suits you.

List of items in startup costs

Note: I am only showing one month for certain expenses. You should be able to get your first job or two in a month. Then these items become operating expenses, not startup costs.

The assumed startup costs for this business idea, using a frugal style of business operations, consist of the following items:

Advertising and promotion (1 month) -- Small classified advertisements in a local newspaper and/or national newspapers or magazines.

Business insurance (1 month) -- Business liability insurance. (Talk to a local insurance agent to see if this protection is really needed.)

Governmental requirements -- Local fees and business license. (Note: You might also be subject to state and federal deposits and registration fees, but these will vary. So I have not included them in these startup costs.)

Office equipment -- Business telephone, desk accessories (stapler, paper clips, pen and pencils, etc.), and listing adding machine. (Note: Use the kitchen table and chairs for your desk and chair at first.)

Office supplies -- Check blanks for business checking account, file folders or large manila envelopes (for filing papers), lined writing tablets, and pads of accounting journals and ledger.

Other operating expenses (1 month) -- Business telephone expense.

Reference book -- Bookkeeping for Dummies (Paperback). (Note: The "for Dummies" series of books are easy to read manuals for normal people, not dummies.)

Dollar amount of startup costs

Here are the dollar amounts for a frugal business operation:

 

Estimated Startup Costs

  Advertising and promotion (1 month) $ 75
  Business insurance (1 month)   50
  Governmental requirements (local fees and business license)   50
  Office equipment   120
  Office supplies   85
  Other operating expenses (1 month)   50
  Reference book   15
     
       Total estimated startup costs $ 445

Note: See the Planning costs and expenses subtopic in the Business Plan on another page for ways to reduce these startup costs.

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Putting idea to work

This topic satisfies the Starting business operations subtopic in the Business Plan page.

Preparing for business operations

Completing the startup requirements -- This is the last step needed just before you start business operations. See the Listing the startup requirements subtopic in the Business Plan for the items remaining to be completed.

As a minimum, you should have discussed the business idea with your family, set up your business entity, and satisfied all governmental and insurance requirements.

Operating the business

Soliciting customers -- Place classified advertisements in a local newspaper, and/or a national newspaper or magazine. Use a simple, honest description of your services. (Once you become established as a provider of this service, you should benefit from word of mouth advertising from satisfied customers in your local area.)

For additional ideas on soliciting customers, see the Sales Methods page in another section.

Qualifying customers -- Hopefully, some of the people who read your advertisements will inquire about your services. During this initial telephone conversation, you should determine:

  • If you are willing and able to provide the desired services.
  • If you and the customer can agree on an hourly fee, unless this was stated in your advertisements.

See the preceding Profitability of idea subtopic for my thoughts about setting your fee.

Getting customers -- After a satisfactory trial period, a prospective customer might agree to pay for your service on a long-term basis. You could try to get as many customers as you can handle.

Determining needs of customers -- To insure satisfied customers, you need to determine what they want from you. You need to replace assumptions with specific instructions.

You and the customer should agree on the service to be provided, and the frequency and amount of payment. Depending on the service to be provided, you might need some background information from the customer.

Thus for an answering service, the customer might provide you with the exact phrase to use when answering the telephone. The customer also should specify the hours of operation for the answering service.

You also need to determine when and where to perform the services and receive your fee.

Job procedures

Preliminary service activities -- Keep a calendar showing the date and time the service is required. (Remember to make any needed time zone conversions.)

Main service activities -- You would perform whatever telephone services are required at the required date and time.

Final service activities -- Collect your agreed upon fee from the customer. (Your agreement with the customer should specify the frequency and amount of these payments.)

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