If you are getting ready to start a small business or trying to get your company off the ground, it can be a challenging time. There are frustrations, pitfalls and financial strain. However, if you are able to stay the course and find a way to make your business work, it makes all the difficulty worth it. Nearly every small business founder you hear about is exceedingly happy with his or her choice to take the risk to turn a passion into a career.
One thing you can do to help give your business the best chance of success is to learn from others’ mistakes. Taking the time to research other people’s business successes and failures can give you a good idea of what to do and what not to do. Of course, there isn’t any advice that can guarantee success, but avoiding these nine common mistakes can get your company off to a good start.
1. Not Researching The Market
If you want to start a business, chances are it’s because you have a passion for some idea or industry. Before you invest time or money into a new company, be sure to take a good look at the market, especially as it applies to your chosen field. You need to see opportunities, know your competition and figure out where your business will fit to garner enough clientele by doing some customer research.
2. Discounting As A Business Plan
While it seems to be a temptation that many small business owners fall into, it isn’t smart to discount your services or products just to gain customers. Not only will you be setting up your business for financial insecurity, you’ll be telling potential customers your services aren’t worth what other companies are charging. This is not a good revenue management strategy. Any customers you do bring in will most likely only stay while your prices are low.
3. Not Advertising
With the rise of e-commerce and the global market, there are potentially thousands of other businesses in your industry. Potential customers can’t choose your business if they don’t even know it exists. Even if you don’t have a large financial budget, you can use advertising methods that cost time rather than money such as social media marketing.
4. Advertising The Wrong Way
Along with not advertising at all, another common mistake is advertising in ineffective ways. Before you determine your marketing campaign, you need to have a deep understanding of who your target audience is and the most likely ways to reach it. Otherwise, your Facebook advertising cost among other platforms will be too high to earn a profit. For example, young professional consumers may respond better to video marketing, while social media platforms such as Pinterest generally engage women.
5. Not Having A Backup Plan
Starting a business is risky, so you need to make sure you have fail safes in place in the event things don’t go as planned. This means a financial emergency account for yourself as well as all proper legal documentation protecting yourself and your company from lawsuits. These should be budgeted in addition to your start up costs. You should also consider what to do if your first fundraising attempt fails or you don’t attract customers right away.
6. Doubting Yourself
One of the biggest mistakes for an entrepreneur is self-doubt. Experienced entrepreneur David Kiger is very open about the fact that his success is based on faith in himself and his ideas. He recognized his own talent for seeing solutions and pursued his goal of turning that talent into a business and career. Being successful in your chosen field requires belief in yourself and your abilities as well as a willingness to follow your own passions.
7. Not Making Your Business Unique
In many industries, the market is saturated with other business similar to yours. Part of your business strategy should be figuring out a way to make your company stand out from competition. When your company really stands for something, your employee engagement will rise too. You don’t necessarily need to invent something new, you may just need to help your potential customers see things from a different viewpoint.
8. Hiring Based On Emotion
Maybe you dream of a successful family business or starting a company with your best friend. In reality, it’s never a good idea to hire your first employee solely based on personal relationship or emotional ties. Owning a company requires you to think practically, and part of that is hiring people on their strengths and the benefits they’ll bring to your business, rather than just hiring people you like. To find great talent, follow this advice for career fairs.
9. Hiring Based On Cost
Another common mistake for entrepreneurs is to hire based solely on the cost of the employee. This is unwise. It will negatively impact your employer branding. The best employees will not work for less than they are worth. In addition, the worst employees will probably take the job at the quoted offer, but then quickly expect and request a raise – even if their work has not warranted a pay raise. Cheap employees will not provide the quality, experienced, skilled and reliable work that a professional who costs a bit more will. Do not hire low-cost employees, as they will almost always turn in work that proves why they were low-cost.
10. Giving Up Too Soon
Of course, there is a time in many circumstances where it’s wise to admit defeat, but many entrepreneurs reach that point too soon. If you are going to start a company, you should know from the beginning that there will be setbacks. You should be willing to carry on at least to a point, like countless PR companies have. When you are creating your business plan, try to set goals and boundaries so you’ll know what kind of setbacks you can recover from, and when you need to stop or try something from a different angle.
Starting a new business can be both a challenge and a thrill. Learning from other people’s stories of success or failure and from social media tips can help you make the right decisions for your own company. If your business succeeds, you can look forward to being an inspirational story for future entrepreneurs.
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