Aspiring entrepreneurs are full of energy and ready to take risks. But there are a few common business mistakes to avoid as an entrepreneur for better execution. By carefully avoiding these mistakes, you will save yourself from major losses that you might face if you were to ignore them.
A study shows that about 50% of startups decide to quit within five years in the U.S. This is because half of the startups make a profit in their first year and the other half don’t. Surprisingly, the ultimate reason for quitting is the missteps they have taken at the start. While these mistakes are inevitable, you should know where you were wrong at the very least and know your next steps. Okay, so let’s dive into these common mistakes and how to avoid them.
Unfamiliarity With The Reality
Seeing some startups boom crazy and get insane revenue makes anyone hyped, especially entrepreneurs. However, they misunderstand the assignment and don’t consider the harsh realities of the process. Mainly, not knowing the reality leads to insufficient funding and cash flow problems. And eventually, this breaks their souls and makes them quit in the early stages.
Solution
The main thing that is going to make you quit is the money. So, prepare a realistic plan covering all the initial costs to the ongoing operational costs that your business will need. Beware that you will have to hire resources and pay them as well as other things that you want to have on the way. Take these into consideration and then form a realistic plan.
Insufficient Knowledge
Majority of the entrepreneurs overestimate themselves and think that they have all the knowledge needed. However, this isn’t the case for most as this is a continuous learning process where you will have to invest your time in learning. This leads to not having a clue why everything is falling apart and how to manage everything. A thing to note, even while generating revenue, knowledge is still as crucial to planning your next step as recovering from a loss.
Solution
Knowledge is power, right? Always remember this because if you haven’t enough of it, everything is likely to fall apart eventually. Thus, you should study popular market trends, and research your audience properly, especially their pain points. Once you have sufficient knowledge, execute what you have learned and see how much difference it makes.
Not Having a Plan
Launching a business without a proper plan is just like roaming around the city without a map. That’s why you need to have a complete chart of your course to follow wherever you go on your journey. However, most entrepreneurs make this mistake and instead of thinking ahead of time, they focus on a smaller picture.
Solution
You should sit back, relax, and put your mind into what resources, strategies, or goals are ideal and achievable. Also, create a list that specifies your targeted audience, value proposition, marketing channels, and lastly your financial goals. Once you have a clear roadmap of your journey, you will be good to go.
Having the Wrong Fits
Once done with the initial preparation and planning stage, the next step is to hire resources that will add value. Unfortunately, startups often fail to do so and this leads to having the wrong fits in the team and making things fall apart, eventually. While they can easily be replaced, this takes time, and the damage is already been done. If not taken care of, this can break everything, from the office culture to operations, eventually leading to a disaster.
Solution
Don’t rush and be impatient while choosing who will be a great fit or who will not. Remember, it’s all you and you will be responsible for everything. So, invest time and money in the resources that are worth adding to your team and can fit in with the rest of the team. Done properly, you will have a team with the same mindset and thriving for the same goal.
A Toxic Culture
Have everything sorted out and what do you need? Great, but if you don’t maintain a positive work environment, everyone is gonna leave you and you will be left all by yourself. Remember a place with a lack of respect and poor communication is a big no for talented individuals. They tend to avoid such places and will leave immediately just because of the toxicity.
Solution
Talk politely and show respect whenever you are with the team because they contribute greatly to your success. Create a healthy environment and they will eventually be more productive and true to the cause. Find those who are spreading negativity and take care of them and you will be off to a great start.
Overlooking Online Presence
A crucial aspect that modern-day businesses need is a great online presence. Overlooking your business’s online presence is a terrible decision in the present era. If your business isn’t on socials and you don’t invest in making a website, there’s very little probability that you will succeed. Because this is the age of social media and the majority of the leads are generated online not having your business out there won’t do any good.
Solution
Firstly, invest in building a responsive website and get your business on socials. Remember social media is all about trends and a website is all about relevance thus make sure you excel in both areas. Be active on relevant social media platforms, creating engaging content and interacting with your audience.
Poor Cash Flow Management
Lastly, when everything is going smoothly; leads come, making revenue, and building a great reputation comes the important skill, cash flow management. Know that the cash flow is the lifeblood of your business, no matter what you are doing. Not being able to manage what coming and what’s going on will derail your business.
Solution
Plan and implement effective money management techniques for your business to save your business from disaster. Trust technology for this purpose as many great tools offer robust management of your money and tell you exactly what you should do. Also, forecast what’s coming and will be going and plan accordingly.
Ending Note
Starting a new business is a great idea and good luck on your journey. However, be mindful of each step you take because it’s your money and you are the one responsible. Lastly, do remember, we all make mistakes but the ones who learn from them, and that’s what we expect from you. Go ahead, get yourself knowledgeable, create a plan, and do your best.
