Starting up a business is not a joke. There are so many issues to consider that most people just shudder at the mere thought of being confronted by them. You have the basic idea about what you want to do and the objectives you want to achieve. Not all businesses are successful though. For every Microsoft, there is an Air America Radio. So, why do businesses fail? Here are 10 common mistakes made by entrepreneurs when starting a business.
1. Lacking Uniqueness
The business you are entering into may have a thousand other providers. If you just present yourself as one of the thousand, you are in for a harsh time. You have to sound and look unique by standing out in the crowd. There are many ways in which you can give your business a touch of exclusiveness, e.g. flexible working hours, fixed delivery times, 24/7 personal helpline, etc.
2. Inadequate Planning
An idea is just an idea. An idea does not make a business successful. You have to plan how you are going to implement and use the idea to your benefit. Just remember, the better you plan, the better are your chances of success.
3. Unnecessary Expenses
Printing out promotion material is not cheap, especially if you have not received your first pay check yet. You can spend thousands of dollars on brochures, leaflets and flyers but having not established your business, all of that expense will not bear fruit. Always try to minimize costs, especially in the early stages.
4. Aggressive Advertising
Advertising is a way to attract more customers but spending exorbitant amounts of money on it is foolhardy. Forget all about copying the silly branding advertisements you see. No small business will ever have enough to establish a brand in this way. Instead study direct marketing, and think about how you can directly put your sales message/ your offer in front of your prospective customers in the most appealing ways. For example, posting leaflets or writing a press release and sending to your local newspaper are great almost free ways people can hear about you.
While making a website before serving your first customer is foolishness, paying a ridiculously large amount of money for it is the icing on the cake. It is better to get a website made for free by a friend, rather than spending hundreds of dollars hiring a professional to do it. Websites are cheap to make but if you don’t have the cash, then it makes no sense to have one.
6. Marketing Yourself
You may be a Harvard graduate, but that’s not going to get people to become your customers. You have to focus your energy on marketing what you have to offer, on how you are going to solve your customers’ problems, rather than indulging in self praise.
7. Advertising in the Wrong Place
Advertising yourself in places that hold no relevance to your work is another common mistake. If you are in the masonry business, don’t hand out flyers at a burger joint!
8. Stopping your Marketing Campaign
The results may not be pouring in and the revenue stream may be drying up, but if you continue to market, a few people may just be attracted. Stopping it altogether means you have given up hope of being successful. I recommend Guerrilla Marketing by Jay Conrad Levinson for great, low cost ways to market what you offer.
What works for someone else may not work for you. If you believe that copying someone’s approach or ideas in your industry will get the job done for you, think again. You will be surprised to know that sometimes it may not even be working for them. However, copying how something is done in one industry that you know is a success and applying it in your different industry is a fantastic way to put yourself ahead of the crowd. For example, McDonalds copied the drive-in concept from drive-in movies. FedEx copied the way banks clear checks quickly and applied it to package post to ensure overnight delivery.
10. Giving Up
You have been working for a while but have nothing to show for it. You are considering shutting up shop for good. Don’t! At least try to make something of the opportunity you have. If having too few customers is the problem, try other ways to market your business. If you're feeling down, try using dirty motivation, the best motivation when the world is against you. The best revenge is success. Show them that you can do what you set out to do.
However, if you know you've given it everything and people just don't want what you're offering, then don't be afraid to move onto something else. This isn't the same as giving up, you're just moving on. There isn't any successful person on the planet who hasn't failed at some point in time. The key is to fail fast but to stand back even faster and move on.
Your business can be successful if you avoid making these mistakes.