How to Avoid Common Mistakes Made by Novice Entrepreneurs
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Starting your own business is a great way to get out of the nine-to-five grind and take control of your professional life. However, many entrepreneurs fail to achieve success because of avoidable mistakes. If you’re pursuing entrepreneurship, you don’t want to meet this fate. Discover some of the most common mistakes made by small business owners and how you can avoid them below.
Failing to research business entity options adequately
Setting up your business as a formal legal entity can help protect your personal liability in case legal issues arise for your business. It will also simplify tax filing and bookkeeping. Research the types of entities available and the tax implications of each one; for example, you can consider entities such as sole proprietorship, a limited liability company (LLC), a C corporation or an S Corporation. If you don’t know what’s right for you, consult an expert to make sure.
Not writing a business plan
A business plan provides detailed information about your company’s products and services as well as how it’s run and who owns it. As Simply Business explains, writing a business plan will help ensure you have an accurate snapshot of what your business is all about and how you intend to grow it. You may also be asked to provide a business plan to banks when requesting a loan. Similarly, potential investors in your company may ask to see a plan.
Failing to address funding
Odds are you will need some financial help to get all the tools and technology you need to start your business. This is especially true if you’re starting a company in a skilled trade, where advanced machinery may be needed (which can cost a lot). Make a list of all your overhead expenses upfront and then look into diverse funding options. Be sure to also get a good reading on your credit score. If it needs work, you may have to broaden your scope when scouting for funding.
Trying to do it all yourself
One of the biggest mistakes small business owners make when getting started is trying to do it all themselves. This will quickly leave you burnt out. Conversely, the other major mistake entrepreneurs make is hiring people without properly vetting them. Learn how to thoroughly interview people before hiring them. You might conduct an interview, check references, and do a background check. However, make sure to abide by relevant privacy laws.
Ignoring the value of marketing
Marketing is how you will attract new customers and grow your business. Many entrepreneurs assume they can get the clientele they need by word of mouth. However, it’s important to broaden your reach using digital tools like social media. A social media marketing expert can help you showcase your business to the broader community, increasing conversions and boosting sales.
Settling for a subpar website
A stellar website is the cornerstone of any digital marketing strategy. Usually, you will use digital tools like social media or blogs to drive content back to your website. For a beautiful, engaging website, connect with the pros at Skilled Graphics. We can design a custom website for your business that’s intuitive and speaks to your brand.
Neglecting to invest in administrative tools
Small business owners are often focused on the raw goods they need to deliver their products and services. For example, if you’re a tradesperson, you’ll prioritize getting the tools you need. However, it’s also important to invest in administration tools. Project management software, time scheduling technology, and accounting aides are a few examples provided by Inc. These things can help simplify the back office side of your business.
By educating yourself about common mistakes made by small business owners, you can avoid these pitfalls. The above list is a good starting point.