Big Mistakes Entrepreneurs Make When Starting a Business
Mistake 1: You Don’t Have Enough Resources to Start the Business
In many cases, it could take time before your business will start to make money and see a profit. Make sure that you have the money and resources to remain financially stable when starting out. One of the best plans of action would be to start your business while still maintaining your current job. This not only gives you an opportunity to see if this something that you really want to do, but also something you can achieve financial success and freedom with. If you are fortunate to be able to quit your job and do your business full time, make sure you have developed a budget for your business and your personal expenses that is covered by at least six to nine months of your personal savings or other resources. Many businesses end up failing when owners are forced to go back to the job field because their business did not have the time to grow and be successful due to running out of money.
Mistake 2: Trying to do Everything on Your Own
When business owners first start their company, a common mistake is trying to save money on things that are important to the growth of the business. While they may be good at making or selling their product or service, they lack the knowledge and experience in other aspects of being a successful business. It is important when you first start your business to invest money into a good lawyer or accountant. You might not be able to pay them on a regular basis in the beginning, but you should at least spend the money to do a consultation of your business. They can help the owner not only understand necessary aspects, but also ensure everything is in place to keep the business running smoothly. I’ve seen so many businesses get tripped up because they didn’t take care of paperwork or licenses necessary to the business or have tax issues because they lack the knowledge or experience necessary.
“It takes money to make money.” That is something to keep in mind when starting your business. While it might be “cheaper” in to do your own accounting, apply for licenses, or fill out and turn in necessary paperwork on your own, the time and research it takes will end up costing you so much more than finding someone who has the knowledge and specializes in these processes. When your focus should be your business growing, you shouldn’t waste time doing these things; you should be out servicing and earning clients. If you find the right people to help you with this process, it is well worth it.
Mistake 3: Finding the “Right” Client
This is going to be hard for some of you to take…everyone will not be your client. I know, I know…. you’re mystified. WHY would anyone not want to utilize your amazing skills/product? When you first start out you think that you have a product or service that everyone can’t wait to buy from you. You expect all your friends and family to be first in line. When it doesn’t work out that way you might become bitter and believe they really weren’t your friends at all, since they don’t support you. However, as you grow your business you will discover that there are many people you do not want to be your clients and some of these people are your family and friends. In many cases, they saved you the trouble of having to fire them as clients later.
“All money is not good money.” Before you start your business, figure out who or what your ideal client is. If someone is a “bad” client, you must have the courage to walk away from them. Although it isn’t always easy, you don’t want to spend all your time dealing with these clients. Having a portfolio full of bad clients will stunt the growth of your business and is hardly prosperous. Make sure to not only the right find clients, but ones that will help your business grow, as well by referring you to more good clientele.