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You decided to quit your 9-5 and venture into the unknown of becoming a business owner. You’re excited, hopeful, nauseated, and ready to jump in with everything you’ve got. But, just because you’re “ready” doesn’t necessarily mean you’re fully prepared. The U.S Bureau of Labor Statistics says approximately 20% of new businesses fail within the first two years, and almost half of all new businesses don’t survive after five years. So, what are they doing wrong? Unfortunately, many small businesses have had to close their doors because of the pandemic, but some businesses managed to hold on and survive during those tough times. Here are some mistakes to avoid when starting your own business:
Not having a business plan
Working out your business plan and sticking to it is key to having a lasting business. It requires a lot of research and will take up a chunk of your time, but it will save you headaches and money in the future. A good business idea doesn’t last without one.
Not having enough money
You have to make sure there is enough money saved so you and your family can live comfortably once you start your business. Most new businesses don’t see any real capital for years. Investing in your own venture costs money as well, and the business expenses will eventually add up. Having enough in savings means you won’t end up drowning in credit card debt that will take years to pay back.
Not promoting or doing any kind of marketing
The beautiful thing about the Internet is it’s easy to promote your business on social media. But, only if you know what you are doing. The best thing about Instagram, Facebook, and Twitter is it’s free. However, growing your business presence online does take time. Consider hiring a freelancer who knows how to promote on social media, or maybe see if a relative or friend can do it for free. Create a marketing plan to figure out your target audience and how you want your business to be promoted. Did you want to focus on local customers? Then maybe create flyers and put them in neighbors mailboxes. Is your company just online? Then social media is definitely a great way to get your company’s website noticed.
Not knowing the competition
Sometimes new business owners are so eager to launch that they didn’t realize who they were competing with. Try looking up the products you want to sell or the services you provide, see who else has the same idea, and do better. Also, understanding market saturation is key for your competition. Say you want to have a lemonade stand that has the best lemonade hands-down in your county. Then, after googling your competition, you find out there are a few lemonade stands with rave reviews that are local. You don’t want to go into business with a product that is already saturating the market.
Not getting any help
It’s difficult to do everything yourself when you are a business owner. From customer service, to paperwork, accounting, and marketing; it’s just too much for one person to handle. Look for ways to minimize your daily tasks by delegating and outsourcing. See if you can hire a contractor to do your accounting or hire someone to take calls and orders. Spending a little extra money will save you a world of pain in the end.