How to Avoid Major New Business Pitfalls
Running a business is a difficult task. You need to grow your business without making large mistakes that could cost you everything. New business owners are notorious for making poor decisions that they could have avoided with a little research and planning.
Here are 10 mistakes that are often made by small businesses:
1. Not Doing the Research: You may think that the product or service your business offers is the “next best thing”, but you need to know for sure. You will never understand the true potential of your business if you fail to research the competition, demand and potential customer-base.
2. Failure to Create a Business Plan: Small businesses, startups and even freelancers need a plan of action for their business, including goals, objectives and a roadmap for getting there. Planning provides you with the steps that you need to take to be successful.
3. Not Marketing the Product: You might have the greatest product or service in the world. If you don’t invest some money in marketing it, no one will know about it. Always set aside a portion of your overall budget for online and off-line marketing tactics.
4. Not Investing in a Website: In today’s climate, if you don’t have a website, you might as well not have a business. Most people research businesses online. Ensure that your website has a clear call to action (including your phone number, email or contact form on every page), important information about the company, marketing materials (white papers, how-to guides, etc.) and links to your social networks.
5. Solely Focusing on Sales: If your entire goal is to get more sales, then you might be missing the mark. You need to build a business that includes quality products, people and customer service. Sales will come if you invest in your business as a whole.
6. Charging Too Little: You’re new to the field so you want to get as much business as possible. You under-value your product or service to attract new clients. The problem is, however, that you’re probably losing money or not making enough to cover expenses. Do the research, and find a price point that shows your value and that will still attract customers. Your business is valuable; price it accordingly.
7. Poor Customer Service: Businesses live and die by reputation, especially in the age of social media. With social media, people have more avenues for venting their frustration – and all of this information is public and readily available via a Google search. Failure to treat current or potential customers with respect will put you out of business quicker than anything else. Customers will share both good and bad experiences online and off-line, and too many bad experiences will hurt your reputation.
8. Not Diversifying Your Customer Base: Many people start businesses because there was a need amongst their peer groups. The business is an immediate success due to this niche. If, however, you solely rely on this handful of customers and never branch out, you’ll be in trouble when these customers no longer need your services.
9. Not Thinking About Spending: This can relate to over- and under-spending. Some people want the newest and best of everything, including the most current equipment and prettiest website. You’ll run out of money before you begin. Others won’t spend a dime –even if it means not growing their business. You need to take a middle-of-the-road approach when it comes to business spending: not too much, but certainly not too little.
10. Lack of Commitment: Small business owners must be driven and willing to make major sacrifices for their business. They also must be willing to learn new skills and adapt to marketplace changes. Business must always come first. Learning from these common business mistakes is your first step to creating a successful, sustaining business model.
