The business world is cold, harsh and, if you’re not careful enough, can cause your dreams to be crushed into pieces before you know it. However, it’s not doom and gloom all the time; there are also many successful businesses that have made their way from the ground up.
In this article, we will discuss the nine worst mistakes that new entrepreneurs make most often. Read through and you can save yourself and your business from making the same mistakes.
1. Pretending You Know It All
Many entrepreneurs try to do everything on their own in order to prove a point – that they are enough on their own and capable of going solo. However, a little help can do wonders. After all, nobody is a know-it-all in the literal sense. So, keep your ego aside and seek out mentorship and advice from people who are experts in their field. For example, many business owners ignore the importance of investing in an experienced accountant or CPA to keep their taxes in order.
Reach out to people you know and trust to discuss your ideas and problems. Remember, more often than not, the solution to your problems is only a question away. On an additional note, there’s a chance that you’ll learn lessons that could otherwise take you years to learn, thus avoiding petty mistakes that could potentially harm your business.
2. Being a “Jack of All Trades”
Often new entrepreneurs get so carried away by the idea of bringing in new businesses that they start listing all kinds of offers and expertise that doesn’t fit their cup of tea. While doing so does bring in more business initially, what’s the point if you can’t keep your promises? All it does is make a huge blow to your reputation!
Think for yourself; why would anybody want to work with a business organization that has a plethora of bad reviews? So, instead of trying to wear every hat at once, you should focus on what you do best. Even if you do decide to go the other way, make sure that you bring someone on board who has enough expertise in what you start offering.
3. Minding Your Own Business
“Mind your own business” is a term that everybody likes to throw around to discourage keeping an eye on what people around you are doing. However, when it comes to actually running a business, it could not be further from what you should be doing. Many new entrepreneurs get so lost in their business that they forget to keep an eye on their competitors. Meanwhile, knowing what their competitors are up to can help them grow faster.
To be more precise: if you watch your competitors, you can know what did and what didn’t work for them, and why it did or didn’t work. Honestly, this can save you from having to do insurmountable market research if you stay on top of it; you can learn from their success and failures to increase the chances of success for your own business. But, don’t just replicate successes – consumers can tell when you’re just copying a successful company. Instead, take what your competitors are doing right, pinpoint the aspects that can be improved, and launch a better version.
4. Spending Money Mindlessly
While the whole idea of having your own business is to give you the freedom to do whatever you want whenever you want, you have to be very careful about how and where you spend your resources – especially during the early stages of your business. Many businesses fail because they spend their funding or their own investment on unnecessary expenses. In the current eCommerce landscape, many feel that it's much cheaper to start an online business. But, there's hidden costs that you may not be aware of, which is why a budget is vital. Simply put, keeping a budget in mind can go a long way in bringing you the success you want and desire.
So, create a budget to get a rough idea of how you are earning, saving and spending. And, if your earnings are less than what you are spending, re-think the way you run your business. If not, it won’t be long before you start accepting rates that pay much less than what you deserve just to make ends meet, which is the exact opposite of why you stepped into the business world.
5. Hiring the Wrong People
Many times, new entrepreneurs focus on simply lowering the burden on their shoulders and do not put much thought or effort into hiring the right people. They often tend to forget the success of each and every project depends directly on the people working on it. The point is if you hire people who lack the required skills and tenacity, do not be surprised when things don’t go the way you had imagined.
Many entrepreneurs have fallen into the trap of hiring the wrong people just to save a few bucks during their business’s initial stages. But, if you are truly willing to compromise the quality of work or goods delivered by your business to the clients/customers, then be ready for the moment when your customers turn the other way and go to your competitors for what they want. So, even if you are giving newcomers a chance, make sure your interview process is rigorous and really tests the abilities of your potential employees.
6. Not Listening to Anyone
Another very lethal mistake that young entrepreneurs make is that they do not listen. They just keep talking and talking, in spite of the fact that this attitude will harm them more than help.
Many young entrepreneurs like to talk about themselves, their talents, their rewards, their ideas and everything that concerns them because they think it helps them to strengthen their authority. In reality, it doesn’t matter how much you talk if the words aren’t meaningful. The wise do not speak much, but the little they say always makes sense.
It may be tempting to try and pave your own path as a new business owner, going against the grain and not listening to convention. While that can benefit your business by creating new unique strategies and products, there is some old wisdom that shouldn’t be ignored. Industry professionals that have experience in business and marketing have valuable information that should be taken to heart and put to work in your own business – even if it may seem a bit old-school at first. If you ignore business veterans and don’t take their advice, then you may lose out on partnerships that will benefit your business in the long-run.
7. Working on Development More Than Selling
This is also a very deadly mistake I've seen among young entrepreneurs, especially online. It’s very important to balance your focus between developing a quality product with marketing said product. If you’re focusing less on marketing, then it doesn’t matter how good your product is – nobody will know it exists.
Try to realize that nothing will ever be perfect. If it's important to spend more time and do your best to make the most of your product and business, you should realize this as well. You really cannot know the size of your perfect business until it is tested by the public.
Focus 50% on your product and 50% on marketing. It is important to know that, regardless of how good your product is, you need to market it to get results. It is harmful to your business if you are spending 90% of your time developing quality products and selling just 10% of the time.
8. Lacking a Business Plan
The absence of a solid business plan is another fatal flaw that’s common among young entrepreneurs. They start their business and do what they want without realizing that they don’t have an organized direction, ultimately leading to failure.
A business plan will help you to build a successful and lasting business because you already have a systematic, tested approach that prevents you from wasting time (and money) on things that don’t matter and won’t help in the long run.
With a good business plan in place, you can also identify your company's main source of revenue and how to use that revenue much easier. There will be no waste of income as you’ll already have a plan in place for where your money should go.
9. Being Impatient
Have you ever wondered why 80% of small businesses fail? Often, impatient entrepreneurs and business owners are the prime reason. Lack of patience only guarantees that you will never run a successful business; patience is a virtue and helps you to develop better business opportunities.
Having patience as a business owner can go a long way – this is especially evident when you realize that almost every successful company that’s around today has been around for many years. Most of these companies weren’t immediately successful and had to wait decades before they became prosperous ventures. As a young entrepreneur, you need to know that you can’t become a millionaire overnight. You have to work hard and wait patiently for real, lasting success.
However, while patience is vital, it's also important not to wait too long. You never know what will change your business forever, so always stay on top of market trends and make changes to your venture when necessary. Especially in the world of eCommerce, where the nature of the Internet and technology is constantly evolving, you need to be able to adapt.
It can be easy to fall into some of these mistakes, especially if you’re just starting out in the field of entrepreneurship. If you find yourself in any of these, you shouldn’t worry; it’s not too late to change your approach and restructure your business plans and goals to be more effective. By doing your research, asking for help when you need it, and learning when to take a step back, you’ll gain insight into how you can better yourself as an entrepreneur.
But, what do you think about these mistakes? What are the biggest mistakes most of the new entrepreneurs make, in your opinion? Let us know in the comments section below.