Seven Common Errors When Starting a Business
When starting your own business, you must do careful planning. We should cautiously think of the following, before starting a business:
1. Starting Too Big, Too Soon. Usually many mistakes are committed during business start-ups. One of this is overspending. Before you know it, no money is left for the first few months of operations. All the money was spent on the location, equipment, and supplies. Cash flow is very important.
2. Starting With No Business Plan. For failing to make a business plan, a business may crash even before it has been launched. The reason for having a plan is that it allows you to have an objective around which all of your business decisions will revolve. Make a long-term plan and strategy, and then stick to it.
3. Spending Beyond Your Means. As entrepreneur wannabes, we are usually excited to take off. We are more likely to expect profits much sooner than they will actually occur. So as a result, we spend too much money in expanding, hiring too many staff, and making more investments than needed. Use your resources wisely. Most businesses, for at least the first year of operations, make little or no profit at all.
4. Starting With No Marketing Budget. During our business start-up, we should allot a budget for marketing. Most entrepreneurs are too focused on operations. We should have promotional materials, to make our business look credible. Posters and business cards must be done meticulously, and should have all the information needed to promote your business. There are also businesses that need to advertise. However, refrain from spending too much. There are some marketing activities that are for free. Satisfy your clients, and provide a high quality service, and for sure you’ll gain referrals and recommendations to other business prospects.
5. Failure to Identify Your Niche. This is more inclined to happen when we fall too much in love with the product we’re selling and want to revolve our business around it whether it’s saleable or not. Let us keep in mind that while our business is something that we enjoy, it is also an investment that will bring us more long term enjoyment if successful. Continuously analyze your sales to see your strengths, and then push them really hard.
6. Focusing On the Sale Rather Than The Relationship. For new businessmen, their goal is just to have the client sign the contract. But in reality, it does not work that way. Contracts may be broken, especially if they are not backed up by strong client relationships. Hence, as you expand your client base, focus more on establishing firm relationships with your clients, rather than forcing them to sign contracts as quickly as possible. Furthermore, repeat sales are critical to the long-term survival of a business.
7. Failure to Learn From Others. Experience is indeed the best teacher but also the most expensive. It is a bargain to learn from the experience of others. The best way to do this is to attend seminars where you will gain knowledge not only from the speaker but also from other participants. If you need more help then get a consultant if you can afford it. If you plan to go this route, verify his or her expertise since you will be paying a substantial amount.
These are seven of the most basic blunders you must avoid when starting a business. Keep them in mind when beginning your business to gain an advantage in your quest to succeed!
*Originally published by the Manila Bulletin. Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved. May not be reproduced or copied without express written permission of the copyright holders.
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