How To Avoid Common Business Mistakes
Updated: Mar 1, 2019
As a business owner, you know running your own business is not always smooth sailing. No matter how careful you may be, accidents and mistakes always happen. You may not be able to fully fix the problem or undo the damage but you can be aware of it and prevent it from happening again. You’ve probably learned a lot from those mistakes; they helped you get to where you are today and sharing those mistakes with other business owners allows them to learn and grow as well.
Not making plans
Planning your business is essential for its growth. Having a set plan decreases room for error and without it you would have no direction to your goal. Sometimes we have these ideas in our head and we get so eager to reach them that we act upon them without thinking them through. Make drafts, conduct thorough research, and analyze before taking action. It will be worth it and could save you time and money in the future.
Not being educated in accounting
As a business owner, you don’t have to be an expert in accounting, but you should know and understand most of your numbers. Sure, you could hire a bookkeeper but you are still responsible for understanding your cash flow because those numbers are usually the answer to most of your business decisions. You need to be aware of how well your business is doing financially or it could hurt your business.
Under estimating amount of working capital needed
A business owner must understand that they will need more working capital than just the start up cost. They must prepare to have fees and back up savings in case of an accident. One of the worst things that can happen to a business owner is overspending before their business even takes off.
Underpricing or overpricing your product
The best way to judge your prices is by looking at your competitors. If you underprice your product, you may have a hard time making a profit. On the other hand, if you overprice your product, consumers may shop your competition. Try to find a balance price, while remembering that you can always lower the price of a product, but increasing the price of the product can make you lose customers.
Not knowing the market
Being aware of the market is different than being aware of the industry. If you open up a business, you have to be educated in both because understanding the industry is not enough. Having knowledge about the market will identify how your business will perform economically during different periods.
Waiting too long to take action
Maybe you’ve had some ideas on ways you could improve your business but you’re waiting for the right time to take action. Everything in business is time sensitive. It’s important not to wait too long before taking action; if you do, you could miss the opportunity. For instance, don’t wait to hire more employees for your business. They can help increase revenue if done at the right time, but if you wait too long you could lose some business.
Not listening to the people around you
Your employees, your customers, investors, and mentors are all people who support and make up your business. They all have different advice and opinions on what you could do to your business. You want to provide an environment where they feel comfortable coming forward and sharing their opinions. The ideas that they have may be beneficial for your business and it makes them feel valued.
Not investing in marketing
In the society that we live in today, relying on word of mouth to promote your business is not enough.The belief that marketing is always expensive is not true. There are affordable ways you can market online and offline. If you don’t market your business you will never generate the leads you want, build brand awareness or brand recognition to its full potential.
Building relationships is essential for a business to become successful. Networking and having connections is important especially in competitive markets. Not networking could also leave you to be behind on trends and insights.
Not putting agreements in writing
New clients and partnerships can be an exciting opportunity. As exciting as they are, you want to make sure that whatever it is, both parties know what is expected of them. The most reliable way to do this is through proper agreements. Without an agreement contract, it could lead to huge problems and even cost you a lawsuit.
Not backing everything up
We can get so caught up in our work that sometimes, we forget how important some things are to us until we lose it. One of the worst feelings is losing an important document or a project that you spent hours working on which is why backing everything up is essential. It is pretty simple to do and should be done regularly.
Not reinvesting in your business
In order to stay relevant in the market, you have to keep up with the changing times. Although, it may seem costly, it could pick up business. At some point you will have to reinvest in your business to maintain growth.
Hiring the wrong employees
When hiring a person for the job, it goes beyond how well they can achieve measurable metrics. You must also take into consideration their personality and how well they are able to represent the values of your company. When going through the hiring phrase be sure to take the time and and invest in the people who will best fit with your company. Hiring the wrong person could waste a lot of time, money, and could hurt the reputation of your business.
Not celebrating milestones
When you are proud of your company, it encourages others to do the same. As a small business owner, you should celebrate all the milestones and goals you achieve. Recognize how and what you did to reach those goals. Acknowledge the people who helped you along the way and tell them.
Not investing in your website
If you do not have a brick and mortar store, the first thing that many customers will see about your business is your website. The appearance and accessibility of your website can determine whether someone will purchase something from you or click off. Your website should be visually appealing, clean, and organized. It should take a person, no more than 3 clicks to find what they are looking for. If you are unaware of how to create your own website, hire a programer or a graphic designer to help out. Your website should include your contact information, the products you sell, and a bit more information that describes your business. If you want to gain more clicks to your website, you can even feature pages with blog posts, customer reviews, and games. Not only will they increase clicks, but the more time people spend on your site, the higher your ranking in google will be. If you would gain more information on improving your Google ranking, read our post on how to optimize your websites search ability here. Make sure to include your website link on your social media platforms, email signatures, and business cards.