As the nature of employment is changing in the 21st Century, many of us have taken the plunge and decided to set up our own small business, often from home. There are many challenges to be faced when going it alone, however, the positives such as more personal freedom and a better quality of life often outweigh the negatives. Many of us dive in straight at the deep end and it is inevitable that we are going to make mistakes, so here we will take a look at the top 5 small business startup mistakes so that, hopefully, you will not make them when starting up your own business.
1. Lack of Planning
Sometimes that moment of inspiration hits you and you are so excited that you just jump in and set up your business, but unfortunately often this is a huge mistake, as you will not have done enough preparation, and may not even know the market that you are trying to enter. Write a proper business plan, and then write another plan to understand the financial side and finally plan again, this time on the marketing side. Where am I going to get my customers from? Yes, there is a lot of preparation involved, but it is fundamental if you want your business to succeed. You must know your customers and market inside out in order to make your small business successful.
2. Not Embracing Technology
A lot of people who set up their own business can be from an older generation who might not be au fait with modern online practices. In the last 20 years, the world has changed and you must embrace new technology if you want your business to be a success. Technology breeds innovation and ultimately will save you money, so if you are a Luddite stuck in the past, then it makes sense to do a course or use some of these resources so you understand how to tackle the technology you have at your fingertips. Ultimately you will be rewarded as social media and marketing funnels will allow your business to flourish in ways you hadn’t thought possible.
3. Understanding Your Audience
We touched on this earlier but knowing who your customer is, is one of the biggest failings that any startup business can make. You have your great new product or service and after a few weeks, you are making no sales. Why is this? Well, more often than not it is because you are trying to sell to the wrong type of person, or through the wrong channels. Conducting market research is key. Find similar companies and see to whom and how they are driving sales, piggyback on them if necessary, do anything to get in front of the right audience for your product.
Read More: 6 Tools Your Small Business Needs To Survive
An extremely common mistake new businesses often make is overspending. Throwing money around willy-nilly is not going to suddenly increase your sales. Why do you need a brand new van, for example, when you could rent one for the first 6 months to see if it is cost-effective? If you need content writers or SEO experts hire someone on a freelance basis rather than employing them directly. You want to be as lean as possible at the outset, so don’t invest in anything until you have proved that it makes sound business sense. Burning cash will only lead your business to go in one direction and sadly that will not be an upward trajectory.
Often the motivation for setting up your own business is that you want to be your own boss and finally have something that you can call your own. This is all very well but you have to go about it in the right way. There is no point doing absolutely everything yourself otherwise you will spread yourself too thinly and the important aspects of your startup such as identifying your market will suffer. You have employees for a reason, play to their strengths, and start delegating. You wouldn’t have hired them if you didn’t need them, so use them and you can then concentrate on business growth and new opportunities
As we have discovered there are many mistakes startup businesses make, but perhaps the most fundamental is a lack of planning because this can prove very costly and can take an awful amount of effort to put right. Plan correctly and make use of the available technology to promote your business. Learn from others around you and start to delegate. Most of all understand right from the outset who your market is and don’t spend all your cash at once. If you follow these tips then your business will set off on the correct foot for success.