Check out the Top 5 Mistakes New Business Owners Make
Starting a new business venture can really give you all the feels. There’s the happiness that you’re now your own boss, the sense of empowerment that you now run your own show, and most importantly there’s the fact that you can now wake up every morning and do the thing you love while being paid to do it.
Sounds great, right? Truth is, however, running your own business won’t be all rainbows and roses. As any seasoned entrepreneur will tell you, running a business takes a lot of hard work, dedication, and sacrifice. If you really want to ensure your new business gets off on the right foot, here are the Top 5 Mistakes New Business Owners Make, that you should definitely avoid:
- Not Having A Business Plan
The first and most critical step in starting a new business is the creation of a Business Plan. This plan if done correctly will: 1) evaluate the market for the viability of your product or service 2) alert you to prospective competitors, 3) indicate how much capital you’ll need to get started, and 4) estimate the amount of income you could possibly generate.
While business plans can do a host of good in providing direction for your business, many young entrepreneurs in their enthusiasm to get started, tend to bypass this critical step which only ends up hurting the success of their business in the long run.
- Competing On Price, Not Value
For most new entrepreneurs the idea of getting sales for their business by any means necessary can be very appealing. While there is nothing wrong with doing what you need to do to get sales, most new business owners go about doing this in all the wrong ways. In their desperation to obtain sales, one of the most common mistakes new business owners make is underpricing their goods/services to outdo their competitors. BIG MISTAKE!
When you employ this method, while it may seem like you are getting sales in the short term, what you’ll realize in the long term is that you’ve been doing more work for less pay. So, if your business is new to the market, try to focus less on competing with your competitors in terms of price and place more focus on marketing the value your product will provide over that of your competitors.
- Thinking Business Is A One-Man Job
Running a business can be a lot to handle. There are so many moving parts, that trying to focus on them all at once can be a difficult feat. While you may think your business is fairly small and you can do everything that needs to get done all on your own, this is definitely not the case.
The term delegation exists for a reason and if you really want your business to thrive, you need understand that there will come tasks that you will have to delegate as there won’t be enough time in the day to get it all done on your own.
- Poor Money Management
One of the chief reasons that start-up businesses fail is that when it comes to spending money, they tend to bite off more than they can chew. As you dip your feet into business waters be sure to get in the habit of budgeting. Do not allow your wants to overstep your needs and be mindful of incurring expenses that surpass your revenue.
- Not Separating Your Personal and Business Accounts
The importance of separating business from personal in all aspects of our life cannot be over emphasized. As such, when it comes to banking accounts the same principle should be exercised. When business owners fail to separate business accounts from personal ones, they run the risk of overspending business income. An action that makes it more difficult to differentiate incoming cash flow from outgoing cash flow, rendering budget creation next to impossible.
Want to get your business started on the right foot? Avoid these common mistakes!
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