Ever watched someone doing something you’re good at and been amazed by how many mistakes they were making?
As a successful entrepreneur (by successful I mean I work from home, don’t always need pants and can do what I want when I want), this happens to me almost every day.
Because anyone can become an entrepreneur without necessarily having any special training (or even planning, for that matter!), it’s not hard to find people going wildly astray in this field.
When just one mistake can cause your entire venture to crumble down, it’s a shame to see so many falling prey to the same easily avoidable problems.
Here’s What You Need To NOT Do To Get Your Business Going
Just below, I’ve compiled a list of 10 of the most egregious behaviours I’ve seen from struggling entrepreneurs. If you can avoid these blunders when setting up your own business, you’ll be off to a better start than many of your peers.
1. Doing Too Little Research
How much demand for your product is there? How does your version of it differ from those of your competitors? What are the current industry trends and how do experts see those developing over the next few years? Are there any complementary products or services you could offer?
These are all things you should know before making a serious attempt at entrepreneurship, and when you haven’t taken the time to ask a single one of the aforementioned questions, it shows. Do your homework before diving into anything and you’ll end up with much better results.
I use SEMRUSH to research my industry and competitors who are doing it right.
With this I’m able to spy on any website; revealing traffic sources, ad spends, trending content, user demographics etc. It’s an invaluable tool for any web based project.
2. Sticking Too Stubbornly To One Vision
I get it – you don’t take the plunge of starting your own business without being really committed to your dreams. It’s understandable that many entrepreneurs don’t want to let go of even the smallest part of them. The trouble is, very few dreams can be perfectly translated into reality – what seems utterly perfect in your mind’s eye might be too time-consuming, too expensive, too logistically complicated to translate fully into reality.
An intelligent entrepreneur recognizes and overcomes hurdles like this and winds up with a better product for it. Your business should change, adapt, and grow as you work to bring it to its full potential, or it’ll never actually get there.
Utilize a service like IdeaCheck to validate your startup idea within your target audience.
3. Skimping On Marketing
It’s impossible for a business to look beyond next month without a solid marketing strategy in place, but many entrepreneurs assume their products will be so good they’ll sell themselves. News flash – if you don’t actively try to reach customers, you won’t get many. You also won’t know who’s buying your products or what they might want changed, added or improved.
Since most low-cost marketing happens online now, you may even look technologically challenged or out of touch if you don’t participate as well.
4. Not Knowing How To Budget
Operating with bottom-of-the-barrel supplies or fewer staff than are realistically needed might save you money, but it will also hinder your business’ production capacity and make you look unprofessional. A good entrepreneur knows that you have to spend money to make money, and doesn’t hesitate to invest int heir business when it’s called for. That said, there is definitely such a thing as going too far with the expense budget. Throwing money out left and right doesn’t guarantee success any more than being overly frugal does.
Finding a way to provide the business with what it needs to look good and function well while also sticking to a reasonable budget is possibly the most important skill an entrepreneur must master.
5. Not Outsourcing Appropriately
When you’re just breaking ground with your business, it’s understandable to want to do everything yourself – your client base is small, your financials have yet to become complicated and your funds are limited. However, as soon as an entrepreneur gains any kind of momentum with their business, they should start seeking outside help. One person can’t be an expert in everything, and nor can they perform more than about 12 hours of labour a day on a consistent basis.
Hiring or contracting accountants, marketers, supply coordinators and other professionals can help spread the work around and get your business the expertise it needs to thrive.
Use AwesomeWeb to find and hire the worlds best designers and developers.
6. Clinging To Romanticized Views
As the world’s communication and transportation technologies have flourished, so too has the nature of entrepreneurship changed. Consumers no longer have to rely on the offerings of local stores and service providers – if you don’t have what they need at a price they want to pay, there are almost always more options available with the click of a mouse. Entrepreneurs who conform too closely to their image of the small local shops of yesteryear will find themselves struggling.
Price according to the overall market, not the local one, and be sure to open yourself up to as wide a customer base as possible (including online, if feasible).
Create a Shopify store today, if you sell or plan to sell physical products online.
7. Underselling Themselves
On the surface, it makes sense to charge as little as possible for your product, keeping your prices just above cost. This is a bad idea. Not only does it leave the entrepreneur in a precarious position, but it can also make the product look cheap or low-quality even if that isn’t the case.
Unless you purposefully intend to occupy the low-end niche in the market (and have a plan to maintain appropriate margins of profit for yourself, not razor-thin ones), raise your prices. Chances are good that people will be more than willing to pay a little more.
8. Overselling Themselves
No matter what your product or service is, you’re probably not the only seller out there, and you’re probably not the best one either. If you charge top dollar for a less-than-premium product, you probably won’t get as many customers as you otherwise could. There’s nothing wrong with being a middle-market merchant, though, as long as you embrace that status.
Adjust your prices accordingly and track what that change does to your customer base; most often, you’ll make more money overall with a higher volume of mid-margin sales than you will with just a few high-margin ones.
9. Forgetting Their Safety Net
What would you do if you had to weather a sudden period of low to no sales beyond your initial start-up period? Could your business tough it out and wait for better times, or would the lack of income force you to scale down or even close?
Any business owner should always have a sizable emergency fund in their back pocket to make sure their venture can survive through tough times like this. Too many entrepreneurs fail to account for this expense when revenue is high, leaving them with nothing when a rough patch inevitably crops up.
Try these 11 legitimate ways to build a rainy day fund.
10. Giving Less Than 110%
Contrary to what some people claim, no business ever got off the ground without honest, wholehearted effort. Everything mentioned on the list above takes time and energy that you’d probably like to give to other areas of your life, but you must make tackling your business’ needs your top priority.
An entrepreneur who isn’t willing to work long, inconvenient hours and do all sorts of tasks they never imagined even trying is not going to be able to reach true success. It’s a sacrifice, it’s true, but that’s part of the trade-off you make when you open your own company. Don’t think about what you’re giving up – think of the potential rewards instead!
I won’t pretend to have all the answers, and nothing in life is ever guaranteed.
However, if you can steer clear of these problematic habits, you’ll have a much better chance of blossoming into a successful entrepreneur – take it from someone who’s been there.
Success by choice, not by chance!