Every entrepreneur makes mistakes along the way when making their business dreams become a reality. Some rookie mistakes may be easily overlooked and may not be more than a blip on the radar. Unfortunately, other mistakes may be costly both in a financial sense or may harm your reputation as you attempt to make your business grow and mature. Knowing what the potential problems could be may help you strategically avoid them. Top entrepreneurs were questioned on what mistakes they made along the way to business success. Here are some of the most common mistakes.
- Compiling the Wrong Team – When hiring for a new business, it is important to hire people that understand that start ups can be stressful. It is also important to find employees that can juggle several skills at once since most start ups do not have a budget for specialized positions. For example, a web site company may have to ask a graphic designer to also handle customer service as well as his/her primary job responsibilities. According to Entrepreneur, choosing the wrong team is the single costliest error entrepreneurs make, resulting in not only lost income and time but depleted morale.
- Marketing Mistakes – Many new companies don’t know what to spend on Marketing or, worse yet, under-budget to save money. Most successful start up leaders suggest aiming for 10 to 20 percent of your targeted gross revenue.
- Doing Too Much Too Soon – Most business leaders know that launching a company, no matter what the field, is HARD work. Yes, there will be late nights and tons of paperwork. Unfortunately, too many young business leaders take on too much, too fast. Burning out mentally and physically is a real risk. In addition, growing too fast can put a strain on a young company. Be sure to have solid legal and financial advisors who can guide you as your business grows.
- Not Planning for All Contingencies – All new businesses should have a business plan. This doesn’t just mean a rough idea of your business pricing, financial goals, marketing plan and employee guidelines. It should be a well thought out plan. Your business plan will change and evolve but a well thought out one can help you as you encounter tough times or grow too quickly.
- Financial Mistakes – Fifty percent of new businesses do not survive the first five years. Ninety-five percent of businesses will not make money when they first open, and a large proportion of new businesses will not make significant money for years. These stats are scary unless you have done your homework when it comes to financial backing, support and a budget.