It’s not easy starting a small business. One of the reasons entrepreneurs are so admired by the rest of society is because of the risk involved in striking out on one’s own. Many leave the stability and certainty of a salary, health insurance and a retirement plan to bet the farm on a venture they are confident in and passionate about.
Unfortunately, many of these intrepid business people fall prey to some very avoidable pitfalls.
There are many rookie mistakes that small businesses may make, but there are a couple that immediately come to mind:
- Trying to sell a product or service without some clear indication of consumer demand. Yes, you can create demand (the PC is generally pointed to as a good example of a situation where this was done). But, most small businesses don’t have the time, or resources, to do this. Instead, they need to ensure that their product or service is something that there is existing demand for.
- Cutting corners on the visual elements of your brand. In their early stages, a lot of small business owners attempt to take the do-it-yourself (DIY) approach with many of their efforts to save costs on hiring others. This can be a big mistake in many areas, but one that we often see is attempting to create their own marketing materials, which could include anything from a logo, to a website—and everything in between. Unless you’re a marketing/graphic design expert, that’s a risky route to take. The brand image you establish early on will set the stage for how customers and prospective customers will view you for a long time. Image matters.
- Being under-capitalized. Not all businesses require significant investments to get up and running, but many do. For those that do, it’s important to make the required investment to launch and effectively grow the business and to avoid attempting to cut corners.
- Not having—and following—a business plan. It’s important to take the time to seriously think through your business strategy, and to commit it to writing, before launching your business. Those looking for capital, or applying for loans, will be required to do this. But even if that’s not the case, thinking about your target market and market potential, your competition, other external factors that may impact demand for your products and services, required capital, staffing issues, etc., etc., is very, very important.
Starting up a new business necessarily involves some degree of risk. But by avoiding some of the common mistakes discussed above, an entrepreneur can greatly increase his or her chances of success.
Recommended Reading:
The Everything Guide to Customer Engagement
