1. Forgetting to explain your terms of business before starting work

If you do not explain your terms from the outset you leave yourself open to misunderstandings. If your terms of business are payment within 7 days then it is better to find out before you start that the client has no intention of doing that -- especially if you need the cash flow and you have not made provision for the extra interest you will have to pay on your bank loans, or worse.

2. Wholesale your time

We all of us have only 24 hours in a day, seven days in a week -- we can not manufacture more time -- so be careful when a client asks you to wholesale your time. Consider the extra costs of being 'out of the market' for a while, and when the contract expires will you have a lag time before you pick up more business?

3. Omitting to have a price policy in place, or do not stick to it if you do

Imagine you are a river-raft operator and there are only a limited number of times you can go out a year. It costs you the same amount to take one person as it does a full raft. Three people book then show up with a friend -- they argue that all four should go for the price of three because your costs have not increased. You agree with them but then what do you do next week when word has spread and only one person books, but three turn up? And what happens when you fill your raft with non-paying passengers, and just as you are about to leave, a carload of customers appears, waving their credit cards at you?

4. Make spur-of-the-moment guesses instead of pricing things properly

This is a terrific way to lose money fast! If you are keen to get the business and you are an optimist it is very easy to underestimate costs. Do not be hurried into guesstimating or you will end up paying the price!

5. Work for friends at "mates' rates"

A lot of small business operators go slowly broke working for friends. Think about the concept of "mates' rates" -- is that really what a good mate asks of you? Surely a good friend would appreciate your value and be willing to respect that in the customary way?

6. Do not have any convincing sales reasons for not discounting

Your customer may just be asking for a discount out of habit, or curiosity. Be prepared in advance. Is your quality so good, and demand so great, you do not need to discount? What else can you negotiate -- perhaps a longer guarantee, or a better product, a quicker response, an extra accessory?

7. Start work on the job before the client has confirmed terms and conditions

This is a brilliant way to work for nothing! If you are keen (or desperate) to do the work, resist the urge to start before all the paperwork is signed off.

8. Underestimate the amount of work involved

If there are many parts of the project to consider, make sure you itemize each piece. It is easy to underestimate the number of extra phone calls and running around that can occur when things do not go according to plan.

9. Overestimate your ability

If you are confident in your abilities and inclined to think you are a Super Hero watch that you do not overestimate your abilities, believing you can get the job done in less time than is practical.

10. Forget to write things down; keep poor records

Another brilliant way to lose money! If there is a time lag between doing the job and the accounts you prepare at the end of the month, make sure you write everything down. If the client should phone to query an invoice it will be your attention to detail that will save you in the end.