Lots of enterprising people, young and old alike, despite the best of intentions, make critical mistakes when starting their own business. Regardless of all the blood, sweat & tears, 80% of businesses fail within the first year. While this is far from an all-inclusive guide, here are a few tips to avoid common mistakes that entrepreneurs make:
1. Don’t plan, do!
Many aspiring business owners spend way too much time planning and over-thinking, instead of hitting the ground, making the connections and getting the valuable experience they need. Whatever you learn in a business class or textbook is hardly as valuable as what you’ll learn in the real world.
2. Greatest thing since sliced bread
Lots of people hold off starting their own business because they spend way too long waiting to come up with the “perfect” idea. This is a sure-fire way to never even get started. Many successful businesses are new branches of existing franchises, and don’t even require much innovation or original thinking. So don’t obsess over coming up with the world’s most novel business idea. Instead, do thorough research about what your area needs and come up with a logical – rather than shockingly innovative – idea for a business.
3. Work smart
Lots of entrepreneurs sacrifice sleep and personal lives when they start a new business, devoting all hours of the day and their last drop of energy to its success. However, aside from hard work, a new business requires SMART work. The entrepreneur who focuses his or her energies and delegates certain tasks will thrive more than someone who is trying to single-handedly juggle sales, administration, web design, marketing and communications all at once.
For a new business good budgeting is critical. So, why do business owners cut corners on many expenses but waste tons of money on marketing? These days, with tools like the Internet and social media, business owners should realize that great marketing and PR can be free, if not very cheap, and stop operating under the misconception that they need to their budget on marketing. Most entrepreneurs would be wise to curtail marketing expenses as well as try free methods for a period and test the results.
5. Don’t “do you”
Our culture celebrates the “self” and teaches people that they should simply “follow their passion,” no matter what the consequence, claiming that it is the only path to happiness. The sad truth is that people who follow their passion, to the exclusion of all strategy or business savvy, often don’t make any money, and must eventually change direction. On the other hand, business owners who provide a needed, valuable service or product to a market, usually find success. If you’re lucky, a successful market might just be something you’re interested in. Passions are great, but not always what will bring you a solid income.