There are a million guides out there detailing the best ways to start your business, and maybe you’ve already read all of them. Most small business owners have, but even with those advantages, there are four stumbling blocks that inevitably everyone eats dirt because of.
Here are four mistakes every small business owner makes, and how you can avoid them:
1. Not Getting it in Writing
– Neglecting to Detail All Expenses, Big or Small
When you buy several hundred dollars’ worth of equipment, you’re extra sure to jot that down, but when you buy a box of pens or print out a few contracts, it’s easy to pass this off as insignificant. On the contrary, this information be valuable for your taxes as deductions and it’ll make an impact on your bookkeeping in the long-run. Those ghost-expenses can total up to something significant and you’ll have no way of chasing down the real purchases.
– Partnerships without Detailed Terms
Whether you’re starting a business with a friend or a colleague, it’s easy to get caught up in the hype of building your venture and forget to detail the terms and conditions of the partnership. You may think it unnecessary or insulting to create and detail a contract between you and your partner. You grew up with them, you’ve worked together for years, they were in your bridal party – they’re trustworthy. Right? That’s all fine and dandy until you’re three years into the venture and one of you wants a raise, one of you wants to alter a product, or one of you wants to sell your share. Now who calls the shots? Rather than ruining a relationship or simply ruining your finances, getting all of this in very detailed writing from the start will help avoid heartache and failure.
– Poor Scheduling
When the business is just starting out, it’s easy to keep most of the details in your head. Who are you meeting with, how many customers do you have a day, when do you need to be available. Most business owners start out with a solid grasp on the situation, but as your business grows and progresses, forgetting that email you needed to write or neglecting a meeting all together can have you in hot water. Instead, be sure to get yourself a daily planner on day one and jot down even the simplest of commitments, whether you’re supposed to double-check the budget or meet with an investor.
2. Underestimating Obligations
– Over-Working Themselves
Every small business owner can agree that they underestimated the commitment it required of them. Few people expect building a startup to be as time-consuming and hands-on as it is, and once the ball is rolling, either you let it spin out of control or you start chasing it. This leads to owners working eighteen-hour days, taking calls or making runs to the shop on their days off and on holidays, and missing family events because a surprise client needed their attention. Rather than having little Susie never forgive you for missing her dance recital or giving yourself an ulcer, expect the strain it will require and learn to make some sacrifices in both personal and professional areas to keep from going postal or just dropping from exhaustion.
– Neglecting to Grow Their Businesses
That said, while it’s good to not miss Christmas four years in a row, the parallel mistake of small business owners is to not take a leap to the next level when it’s needed. If your business is going to have you reclining in Maui with a drink and a cigar, it needs to grow and use its own wings. While it may be a strain interviewing outsourcing options or training new employees, in the long-run this upgrade will see your business flourishing and your own life finding balance.
In your eagerness to conquer the business world, you might overestimate exactly how much you can commit to. Maybe you were certain your business would stay in one building for the next eight years and easily signed a contract, but four years in, the wise business decision says you should move across town. Now you are either stuck or risking a knee-breaking from Guido for breaking contract. Be sure to pace yourself and not commit to more than you can realistically risk losing.
3. Not Keeping Up With the Market
There, you’ve done it; you’ve broken into the field and are a successful business owner. For now. You’re so wrapped up in the dollar signs and the repeat customers that you forget to see the world changing around you. Many business owners are successful in creating a flourishing business in one setting, but lack the adaptability to keep moving on. This is the metaphorical missile in your Death Star, and the Force afterlife doesn’t take business owners who failed to alter their marketing strategies to suit the trends.
– Failing to Upgrade Their Service
Tastes change, and the service or product you originally offered may have gone out of fashion. Rather than taking this as a death sentence, it’s time to look at the competition and see how they’re managing to flourish in the same niche without lull. Once you’ve identified a couple of their tricks, it’s time to get out the hammer and chisel and tick away at your David until he looks more like Batman, because that’s what the people want.
4. Underestimating Customer Service
Your business may be built around customer service, but that doesn’t mean you’re doing it right. Different customers want different things in certain niches, and what might work for a real estate agency isn’t going to work for restaurant. Instead of offering a blanket approach to customers, it’s important to evaluate the kind of personality your target audience wants. Reserved and professional? Bubbly and humorous? Casual and friendly? A mix-mash of one or two? You can have a fantastic product to offer, but if people don’t feel welcome or encouraged to do business with you, then it doesn’t matter.
There are a million ways to do business, but across the board, these four mistakes are shared by all business owners. Rather than walking into the same wall as everyone else, take note of where these problem areas apply to you and jump ahead of the game.