New entrepreneurs tend to underrate some of the “boring”, mundane tasks and aspects of their business. But these are often the essentials to starting a successful business – finances, market analysis, creating the right business plan, marketing strategy, and so on. In order to achieve your goals as an entrepreneur, there are several crucial startup mistakes you should avoid.
How to start and maintain a successful business? We are constantly bombarded with stories about successful entrepreneurs who are seemingly making money out of nothing. These wonder stories sound as if success is being at the right place at the right time, that it’s all luck and great genes. But in reality, starting a business is all about hard work, having the right business plan, and having the resolution to follow it. Many new entrepreneurs fail, because they are too excited about their idea, product or service, instead of being focused and aware of all the risks that come with a startup.
Here are 8 common startup mistakes that can destroy your dream of being a successful entrepreneur.
Not spending your startup money wisely
Most startups have modest initial funds, so owners prefer to spend as little as possible until they start generating some decent cash flow. Sometimes, however, investing in quality products and highly skilled professionals is better in the long-term. The opposite approach is just as ineffective – spending too much – on an A-grade office, a lot of personnel, latest technology, and so on – will dry up your bank account in the first several months.
Setting unrealistic goals
This is a very common mistake made by new and unexperienced entrepreneurs. Very, very few people on this planet have ever made $1 million in the first year after launching their business. So, setting more realistic short- and long-term goals is a much better strategy. Having a reasonable, specific goal means you will be able to see the specific steps you need to make to achieving it.
Ignoring the competition
Many business owners are seeing their product or service exceptional and much better than what is currently available. But whatever the area or niche market you are in, you are certainly going to have competitors. The only exception is if you indeed have created an entirely new product that the world has never seen before – and that is highly unlikely. So, make sure you research the market well, as well as your competition and the ways you can make your company stand out.
Not investing in marketing
A lot of entrepreneurs think that once they offer their product, customers will start showing up. They won’t, even if you offer amazing, revolutionary and affordable product or service. Every startup needs to be noticed and here comes marketing in the form of content marketing, PR, paid advertising, SEO, and so on. Some of the tools are cheap or even cost-free, but less effective than paid ones.
Working alone
You may start your business on your own, as most entrepreneurs do, but if you are serious about it, you will need to eventually hire other people. It’s virtually impossible to do all the work on your own or have all the knowledge and expertise you will need. Having a partner or a highly skilled and experienced employee is key to success.
Being limited by the fear of failure
Failure at some point is inevitable for every business – you can’t simply win every time. Starting a business is always a risk and if you are constantly afraid of failure, then you’d better not start it at all.
Focusing on affordability of the product too much
When you enter the market with a new product or service, you’d better put a slightly lower price tag, so that clients can choose you over your competition. But, if you focus on affordability too much, you may not be able to become profitable. Determine pricing wisely after taking into account the production and operating costs, as well as the expected revenue as it is in your business plan.
Confusing priorities
Making money is most new entrepreneurs’ top priority. But it’s a mistake – the key to long-term, sustainable success in business is making sure your customers are happy. Satisfied customers are loyal customers, which means you will make money for longer time.
These are helpful points for anyone in a start-up situation. The other important thing to add is to ensure you have a well researched business plan to guide the start-up process and the management team – a road-map that will ensure you stay on track when things get tough! Good luck with your start-up!