You have an interesting business concept and a desire to make it a reality. You’re excited and can’t wait to get started.
As an entrepreneur, I can tell you from experience that it’s not easy to actually start a business. A lot of businesses fail. Only about half of small businesses will last five years. You need more than an interesting idea to create a successful business. Many owners aren’t prepared and make a bunch of mistakes along the way.
I want your business to succeed. I want you to experience the joy that comes from expansion, hiring employees, and increasing sales. To help you, I’m going to alert you to common small business mistakes. I’ve made mistakes, and I’ve seen other entrepreneurs makes mistakes. Learn from us and put your business on the path to success.
Here are the seven business mistakes you need to watch out for.
1. not researching your idea
Before you launch a business, you need to do research first. Not taking time to research your idea is one of the worst business mistakes you can make. Even if you think you have the best idea, it may actually be terrible. Find out if there’s a market for you. Ask potential customers if they would buy what you have to offer. Your idea isn’t great if there aren’t people willing to pay you for it.
Before I started the company that would later become Top Echelon, I did a lot of research. I went through the phone book to find potential customers. I talked to potential customers about their needs and wants. I did research at the library (because there was no internet back then). I found out what it would take to start my own business, and I used my research to shape my business into a model that succeeded.
2. being unrealistic
After you research your market, you need to come up with a realistic plan and realistic expectations for your business. I can understand feeling excited and ambitious about your business. But whatever you do, avoid a dominate-the-world mentality. That kind of thinking will cause you to make bad choices and result in inflated projections and disappointment. Remember, you can’t be all things to all people!
Be realistic. There’s no way you will convince everyone to be your customer. There will always be doubters and competitors pulling customers away. When you set goals and make sales projections, think about what is reasonably possible for your business to do.
3. underestimating expenses
Starting a business comes with a lot of expenses. Many new small business owners spend more money than the business brings in. Running out of money could result in a closed business. Not understanding how much things cost is a common business mistake. You need to calculate the full cost of your products or services. Factor in the cost of waste materials, overhead expenses, and your time.
Some business owners make overzealous sales projections and spend money according to those projections. Because the projections are too generous, the business spends more than it actually brings in, causing a negative cash flow.
This goes back to my second tip: Be realistic.
4. not asking for help
You do not know everything that you need to know to start and run a business. Sure, you can learn things, but that takes time. Acknowledge when you don’t know how to do something, and then find someone who can do it. Not asking people for help is a huge business mistake.
If you try to learn everything yourself, you will waste a lot of valuable time. Odds are you’ll be slow starting out and make mistakes along the way. When you ask an expert for assistance, you can avoid mistakes and save time and money.
5. taking too long to launch
Starting a business can be scary. You want everything to be perfect before you open for business. But worrying about perfection might cause you to never start selling.
While you want to create something people will buy, constantly stressing over perfection will keep your product off the market. The longer you wait to start selling, the longer you go without money.
When you first start your business, it’s acceptable to sell something that’s not perfect. After you launch your business, you can start tweaking your product to make it even better. And, hopefully, you’ll then have customer feedback to base your changes on.
6. ignoring marketing
You’re proud of your business idea, but never let yourself think your idea is so good that people will flock to you. You have to work to get your customers. Every business needs marketing. Without marketing, no one will know you exist.
Try multiple types of marketing to find out what works best for your business. Use flyers, mail, and billboards. Start social media marketing with one or multiple accounts. Create a website and have an email signup so you can do email marketing. Find out where your potential customers are, and go to them. Market to them and pull them into your business.
7. neglecting yourself
So far, all of these business mistakes have been focused on your business. This one is all about you. As a new business owner, you need to take time for yourself. You need to relax and refresh regularly. If you don’t, you will get burned out.
I know how hard it can be to take time away from your infant business. You don’t have to take an extended vacation, but you should schedule a day, or even several hours, away from your business. Spend time with your family and friends. Not taking care of yourself is a mistake. Your business doesn’t stand a chance if you are tired, overworked, or sick.