Common Mistakes Entrepreneurs Need To Avoid
Starting a business can be overwhelming and everyone makes mistakes in the beginning, but with so many innovators before us, we can learn from a few common ones and tackle problems before they arise.
14 October 2019 by
You’re going to make mistakes, no start-up is perfect and even fewer are overnight successes, yet there are small mistakes in the beginning stages of your business that can lead to major problems down the line or even cost you your business altogether. With over 2.1 million small businesses in Australia, why is the rate of failures increasing? Small avoidable mistakes are costing entrepreneurs their business and money. With many entrepreneurs and business owners out there, we need to be taking what they have learned and applying it to our strategies and ideas. Learn from their common mistakes and adopt successful strategies. By doing a little research, preparing and planning your start-up will hopefully avoid these common pitfalls and stumbling blocks.
To make it even easier we have put together a list of a few important common mistakes all entrepreneurs should avoid when starting their business.
Solve the Problem
Your business needs to fill a gap or a need in a market, 42% of start-ups fail because they didn’t solve a market need. Solve the problem for others and then sell it to them, by focusing on need you will be able to sell your product as the solution. People are more inclined to purchase a product if it makes their life easier, emphasis on a solution to a problem rather than the next ‘big thing’. Your focus is your target audience, so it is important to get your product out as soon as possible and test it, this will give you an indication as to whether you need to improve it or if it is even viable. Do not over analyse the planning stage for your first product, spend five minutes putting the idea together and aim to get a tester out as soon as possible. By getting it out there you will be able to build on feedback and criticism to better the idea. Moulding the product to the consumers’ needs and feedback will save you money and time down the track if you waste time and money on a product by not using testers to build feedback you run the risk of misinterpreting the market, cost or demand which could set your business back.
Working by yourself can increase stress and the feeling of being overwhelmed. Trying to accomplish everything yourself will only lead to exhaustion and avoidable mistakes being made. As a result, many will then fall out of love with their idea and business because there begins to be a negative connotation with their work and stress. Instead, focus on just your strengths, don’t be afraid to outsource tasks and invest in a proper set-up, for example, if you are not tech genius or a designer then hire someone who is. It will result in a better outcome and reduce the risk of future problems while saving you a heap of time. Despite just starting you want your business to come across as professional and appealing which is why outsourcing tasks like web-design will put your business ahead of others. The extremely limiting belief that you cannot afford to hire will delay or prevent your business’s growth by 100%.
If you are working as a team don’t be afraid to delegate tasks. Having too many people trying to do it all will only result in chaos and unnecessarily doubling up on tasks. Be strategic with your plan and find the best way to optimise everyone’s time. Be organised and set up guidebooks or strategic processes for how the business should run and the standard expected. Having a clear process in place will mean you won’t have to worry about if all the fine details are being executed and you will be able to focus your attention on more important matters. Delegating is an important part of business development, if executed properly it will allow your business to take on more without being overwhelming or dropping in the standard.
Profit Tunnel Vision
There is no denying that every entrepreneur wants to make money but putting all your time and energy into creating new and different ways to gain profit could delay your business’s growth. Instead, focus on your customers and product-market fit, if you want your product to be successful and to gain market percentage, your main priority needs to be your market and making sure your product is gaining traction and resonating within the market. Remember that many start-ups don’t turn a profit until the third year, some even waiting until the fifth year. Don’t rule yourself out chasing profit, earning enough to break even and invest back into the business should be a greater success. Focus on small goals and achievements and celebrate developments and the businesses market growth.
Just because you have a great idea doesn’t mean you have great management skills, following intuition alone will only get you so far. Relying on your gut or entrepreneurial intuition instead of having proper strategies in place will lead to poor execution and mistakes in product development, marketing and communication. Leading a team on intuition leaves them confused and unorganised which wastes time and money, both things your start-up can not afford to do. Installing proper management disciplines will help sustain your businesses standard and growth. Although it may be time-consuming and difficult at first it will hopefully make things easier, by having proper numbers, KPI’s and strategic planning in place you will be able to easily asses where your business is at and where it is going. Bad staffing practices, inefficient organisational structure, lack of quality leadership and ineffective communication are just some examples of bad management. If you don’t see yourself executing these duties well invest in a short management course or consult with a qualified professional to put a plan and strategies in place to assess and track the business. Or if you are financially able to hire someone with management experience.
Fear of Failing
The opposite of success, a place no one wants to be or have to admit. Many entrepreneurs may glorify the word, fail to succeed but fail means admitting you were wrong and there were no benefits in the outcome. Most of the time this is not the case, there is always benefit in your journey and the paths you take, you didn’t fail you made a mistake and you learned from it. Change your mindset towards failure, get rid of the word completely and change it to an experiment or trial. In everything, you do approach it as an opportunity to learn. You tried a new way of doing things, you experimented with an idea, through this approach you will be able to take away what you learned from the outcome and build on top of it. Create a new experiment with the addition of knowledge and build your business through trial.