Most Common Mistakes of First-Time Business Owners
When you try anything for the first time, you’re likely to at least make one mistake. No matter how much research you do or how much you study, there isn’t a replacement for firsthand experience. That includes starting your first small business. Business classes and seminars may give you a great idea of where to start, but they aren’t tailored to your specific business and the unique challenges you may face.
While there isn’t a one-size-fits-all solution to many of the trials ahead, there are a few challenges you can skip by proactively working to avoid these common mistakes. If you’re a first-time business owner, you can use the experience of others to start your business off on the right foot and avoid unnecessary struggle.
Mistake 1: You avoid working with lawyers.
When you start a business, there are many things you can learn as you go and others you simply need to hire out for. Law is one of the latter. There is a certain extent to which you can do the research on your own, but you never want to be in a place where you can’t move your business forward because you’re held up on a permit you didn’t realize you needed or by copyright issues. Make sure you consult with an expert. Depending on your needs, you may not even need to reach out to a lawyer at all (though it would certainly be a more personalized experience). Instead, look into online legal services like LegalZoom or RocketLawyer.
Mistake 2: You’re too big a fan of your product.
There is something to be said about being passionate about your product. If you aren’t a firm believer in it, how will you convince anyone else? However, an unconditional appreciation of your product or business can make you blind to its flaws. If you can’t be brutally honest with yourself (or your business), how can you make informed choices to improve it and push it to succeed. Find a happy balance between truly believing in your product while still being objective about your business.
Mistake 3: You don’t delegate tasks.
You are very connected to your small business — you’ve put time and passion into building it up from nothing. That kind of attachment can make it hard to step away from all the tasks at hand. While it may put your mind at ease to do everything yourself, it may not be good for your business. If you choose to take over as much as you can, you’re likely to burn out, forget something or make a mistake. If you can’t give your whole focus to something, consider delegating it to someone else. It may not be in your nature to share the responsibility or let others do your work for you, but consider how successful you’ll be when tasks are completed correctly and with passion by someone who is utterly focused.
Mistake 4: You’re not building your network.
No business can grow in isolation. Even the most successful entrepreneurs cannot fulfill all the roles needed to guarantee a business’s prosperity, so they must work with internal or external connections. Approaching someone cold and asking them for something will probably not garner the results you hope for. Instead, start building your connections long before you may need them. It may be for a small favor that only benefits you, or it may lead to a bigger collaboration that helps both you and your connection. Relying on others may be counterintuitive to a small business owner who is used to driving their own success, but those who are willing to collaborate and engage with others will see bigger successes.
Mistake 5: You’re not realistic about your goals.
The best stories are always the most impossible, underdogs overcoming incredible odds in order to reach the top. Those sort of stories stick with us and even make us believe that anything is possible. Unfortunately, those stories are in the grave minority. Don’t compare yourself or make business plans based off of major success stories. Be realistic about what you can accomplish and avoid wasting time, effort and capital. It’s not that a small business owner couldn’t replicate the success of these stories — it’s possible — but it isn’t probable and not always a worthwhile risk to take, especially with your finances. Instead, use those positive start-up stories to inspire you and help form your goals for the next month, next quarter and beyond. Define your own success independent of what others do and you are sure to find it faster.
Mistake 6: You’re spending your money in the wrong places.
When starting a new business, it’s normal to try to cut corners wherever you can. It’s understandable — the costs to start a business are not something to be taken lightly — but are you allocating them into the right places? Areas like branding, professional skills and design are often overlooked. Don’t underestimate the value of building up your brand. This includes marketing strategy, branding items in-store, logo design, etc. Building a strong, authentic voice is just as valuable as having a nice website or a great storefront location.