Opening a new business is an exhilarating and possibly daunting process. While there are countless rewards, financial and personal independence being at the top, there are common pitfalls that threaten every business owner. Below are 10 mistakes new business owners can make and how to avoid them.
1. Not knowing enough about the business you’re going into—It seems silly to say go in with your eyes open, but it does bear repeating. Don’t let your excitement be your downfall.
2. Not protecting your personal assets—You will be pouring your heart and soul into a new business, but don’t let it ruin your life or endanger your home. Consider setting up an LLC (limited liability corporation), get advice from other small business owners, and think about contacting a lawyer.
3. Not creating a unique, value-driven business—Start off on the right foot. If your business mirrors others too closely, there will be no overt reason for customers to choose you.
4. Not developing a business plan—Your business plan is the road map to where you want to go and how to get there. Do your research, get suggestions from your local small business association (SBA), or try the U.S. SBA (www.sba.gov). They’ll keep you from reinventing the wheel, and will often have information on loans/grants and one-on-one counseling.
5. Not setting the right price—Price drives the decision of whether customers contact you or not. Work with your suppliers for suggestions, look at other companies, and do your research.
6. Not changing or adapting as you go—Even though you have a road map, sometimes you need to ask for directions along the way or take a detour. Continually evaluate your business.
7. Not budgeting correctly or planning on making money right away—Don’t put all your eggs in one basket. Have another source of income or some cushion and be realistic in your expectations.
8. Not marketing consistently—Don’t lose the momentum after one good campaign. Develop a plan and stick to it.
9. Not investing in people—Don’t get caught up in the bells and whistles of the latest gadgets or schemes. Invest in quality employees. They’ll always drive your business and be the face of your company.
10. Not focusing on the big picture—Don’t get overwhelmed by the day-to-day necessities. Take a step back and keep track of your priorities. Management by crisis only leads to more chaos.
Tags: small business