Starting a business isn’t easy. There are so many challenges to face and decisions to make. The pressure can cause you to make a poor decision which can, in turn, negatively impact the business potential and give it a major setback. Here are a few fundamental pointers that can help you avoid the most common and dangerous mistakes.
Skipping The Planning Phase
No start up can afford to ignore planning. Focus on goals and prepare a detailed plan that includes business planning, financial planning and marketing planning that would help you when you are seeking funding, when you are joining an association of professionals, when your business changes, or if you take on a partner or investor. Just remember that it should be flexible enough to accommodate some changes as you go further.
Not Doing Enough Market Research
Conducting a proper market research to understand all aspects of your industry is very crucial for a start up. You need to know:
• who your ideal customer is, where and how you can reach them • your competitors and what they charge
• the best price entry point for what you’re selling Read books and trade magazines, talk to a guide/ mentor or stalwarts of your industry and other people in your social network to gather as much information as possible about your business.
Sometimes, in order to see the cash box ringing sooner than it’s possible, small business owners employ more people than the business can afford or needs. Also, start ups need to focus on hiring the right and professional people for the posts. Hiring a friend or former colleague is fine but that shouldn’t be at the expense of professional quality. Don’t hurry up the hiring process; take your time and choose well.
Avoiding New Technology
The new technology can provide new opportunities, help to do work more efficiently and even help save money in the long run. Though, it can be intimidating for a new person and requires time and patience to learn, an unwillingness to adapt to the technological advances can hurt your business in the short and long term.
Underestimating The Potential Of Marketing
Most small business owners make the mistake of assuming that they don’t need any marketing and that business will come to them. The key is to tap into the potential of different marketing channels like word of mouth referrals, traditional advertising, and Internet marketing. Allot a reasonable marketing budget depending on your business and target audience.
Not Preparing A Proper Budget
Small businesses due to perpetual cash crunch are too stingy with capital investment and severely curtail major expenses. Don’t do that. Do a little research and see if there are less expensive but equally good options available.
Prepare a business budget, allocate resources wisely and stick to it. Also, keep a track of where and how you spend every month. Buy inexpensive accounting software or get monthly bank statements to check your expenses and the cash flow.
Doing It All Alone
A common mistake that usually most small business owners do is that they handle everything by themselves. While being the jack of all trades is definitely cost-effective, it needn’t be that way. Build a team and learn to delegate wisely and effectively. This will give you more free time to look after other activities that require your soul expertise.
Draining Yourself Financially
You have already sacrificed your sleep, family, and peace; try not to bleed yourself financially too. Although the temptation to break the personal piggy bank is too high, refrain from acting on it. Also, it’s a good idea to draw a modest salary every month.
It’s both motivating and important. Lastly, remember success doesn’t come early and easy. There will be tough and rough times but you need to continue and follow your goals determinedly. Don’t be disheartened by your mistakes and give it up, but try to learn from them and reinforce your efforts.