Avoid These 7 Temptations That May Undermine Your Business
Have you bad-mouthed your competitors behind their backs? Or, maybe you’ve treated your swelling business account as a personal candy jar instead of using the extra cash to expand your operation?
Temptations come in all shapes and sizes. Here are a few you should steer clear of as a small-business owner.
1. Expanding the business too quickly — Grandiose plans have sunk many a small-business owner. Resist the temptation to carry your business forward on wishful thinking. Avoid this pitfall by defining benchmarks based on solid evidence. Invite a seasoned entrepreneur to give you feedback (and perhaps a reality check) on your expansion plans.
2. Broadcasting your accomplishments — Toot your own horn, but don’t use a bullhorn to do so. No one likes a braggart or a shameless self-promoter. Speak softly about your own accomplishments, and seek out opportunities to draw positive attention to other small-business owners in your community, too.
3. Bad-mouthing competitors — Even if your main competitor has incurred a mile-long list of complaints, and the company’s customers have populated internet forums with customer-service horror stories, don’t gossip about it. People are more likely to shoot the messenger, so to speak, and side with the underdog (the maligned business owner), not you.
4. Foot-dragging in adopting new technology — While you hesitated to upgrade the company’s computers and software, new technology hit the marketplace and now you’re behind the curve. When you factor in lost productivity, not upgrading could cost you more over time than sticking with the status quo. Resist this psychological temptation, known as “creeping normalcy," and don’t delay in making essential upgrades.
5. Putting personal needs ahead of business needs — We’ve all heard oodles about skirting the temptations of an office romance, but personal dalliances continue to shipwreck small businesses. There’s also the temptation of dipping into business capital to fund personal flings. To avoid problems, never view your operating capital as your personal piggy bank. Personal spending is a major reason why new businesses fail.
6. Falsely claiming “eco-friendliness” — The days of slapping an eco-friendly sticker on a product or service are over. Federal regulators are reining in “greenwashing” — and they aren’t the only ones cracking down on false claims. If customers who are environmental advocates find out you’re stretching the truth about your business’s “green” practices, it could come back to haunt you.
7. Showing a preference for high-end customers — Exclusively targeting the well-heeled set may seem like a no-brainer, but catering to the average Joe may offer a better return in the long run. Julia Hanna, associate editor at Harvard Business School, in her article "What Loyalty? High-end Customers are First to Flee," says research shows wealthier clientele are more likely to cast you aside when someone comes along offering better service. Expectations for service are higher, too, so expect to invest more time in servicing big spenders.