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Did you know that more than half of all small businesses fail within the first five years? If you cannot stand the ugly parts of the job, or fail to do your homework, then consider your business to have failed even before you started.
There are many factors that can lead to the downfall of a business but for many wannabe entrepreneurs, the majority of these factors are self-inflicted. They could have been completely avoidable. What are these common mistakes?
What NOT To Do When Starting a Business
When starting a business, these are the things you should NOT be doing at all:
- Not doing your research about your product or service. Opening a company, no matter how big or small, requires a ton of research. Many businesses have failed because they did not research the marketability of their products – think Will Smith’s character in the beginning of the movie, ‘Pursuit of Happyness’. He lost all of his life savings from investing in medical apparatus that doctors didn’t think were necessary. You have to know everything about what you intend to sell; that’s the only way you’d know HOW to sell it. You’ll know where to put your business, who your competitors are, who your potential clients are, and how much you should ask for it – otherwise you’d be a big mess.
- Not having a financial plan. Two of the most common mistakes include overspending and underspending. Always find the perfect balance between spending and skimping on the costs for your business. Spend for what you need, always leave an allowance, keep money for unexpected expenses, and be realistic in your ROIs. Sometimes, we get too excited that we look at our business with our heads way up in the clouds that we expect too much from our business’s income. Setting up goals and having calculated projections could help.
- Not hiring the right people. No man is an island, and no business will ever run with a single man in it. You’ll need people to do things for you, deliver services for you, and help you become more productive. Find people that you can trust with your business. Invest in training when necessary.
- Not having goals. Running a business is like having a relationship. It can only plateau for so long before either one of the parties break it due to lack of direction. When you start your business, have a clear goal and timeline of where you want your company to be. The timeline should be both realistic and motivational. Set your goals, follow them up with a plan, and stick with it!
- Not marketing enough. Your business cannot survive without marketing and advertising. You cannot simply sit in your office and expect for people to come and buy your services. You need to go out there and tell the world about what you’re selling. Even the largest and most successful companies in the world keep their marketing team on their toes every day.
Do all these things sound overwhelming? That’s understandable – and that’s something every other entrepreneur starting a business can relate to. If you want to make sure you’re on the right track with your new business, or you need some sound business consultation, contact Class Advisors! Our expert and experienced consultants can sit down with you to answer your questions, address your concerns, and create solutions for your new business!