Cheapism / YinYang/Delmaine Donson/istockphoto
The path to bringing your small business dreams into reality requires proper planning every step of the way. If it were easy to start a business without a strategy, everyone would do it. Far too many ambitious entrepreneurs quickly become their own worst enemies when attempting to start a new venture. We’ll look at the biggest mistakes that small business owners often make and how to avoid them.
Relying on a verbal or even a handshake agreement instead of a written one heightens the risk of legal problems spreading like wildfire once your business is up and running. Katz Law Group points out that should a business based on a verbal agreement find itself in a legal predicament, the only place to go is the local courthouse for a potentially costly trial. That also goes without saying that under the “bind” of a handshake agreement, parties can make far-fetched claims thanks to the lack of a paper trail.
Measurable business goals can serve as navigational beacons for running a successful small business. You’ll want to establish clear short-term and long-term goals for your business. Without them, your business risks losing focus, stagnating, struggling to find meaningful accomplishments, and ultimately failing. According to Chron.com, one proven goal-setting technique is S.M.A.R.T: Specific, Measurable, Achievable, Relevant, and Time-based.
The software company Collato determined that employees who operate with clear goals are up to 3.6 times more likely to be genuinely committed to their organization, and 6.5 times more likely to recommend the organization as a great place to work. Having clearly set (and documented) goals can serve as the engine that drives a successful small business.
Related: 20 Small Businesses You Can Start With Less Than $1,000
Depending on the industry, you’ll have a difficult time gaining momentum for your small business if you don’t invest in marketing and advertising. You can’t simply rely on word-of-mouth to grow your business. Creating an informative and attractive website and business profiles on social media are great ways to give your business a sizable visibility boost.
GoDaddy determined that a mere 25 percent of small businesses had a website, which is a huge part of marketing efforts. Then, to direct your business marketing efforts, you can experiment with Facebook, email marketing, and paid search. Campaign Monitor found that 70 percent of small businesses use Facebook for marketing, 64 percent use email marketing, and then 43 percent use paid search.
Lastly, you want to make sure that you’re keeping your marketing and advertising efforts within federal regulations. You wouldn’t want to violate the Federal Trade Commission's CAN-SPAM Act just because you mistakenly sent a newsletter to someone who had explicitly unsubscribed from your mailing list.
Unfortunately, cyberattacks aren’t slowing down. Over the course of 2021 there were 1,037 cyber incidents taken against small businesses, according to Verizon. As many as 93 percent of those cyber-attacks were financially motivated. The last thing you’d want to suffer through as a small business is to have your time and resources drained by a cyber-attack that could’ve been avoidedby investing in better cybersecurity.
Related: Identity Theft Horror Stories
It could be something as detrimental as a negative review by a customer who has a problem with the whole world. Or it could be a series of glowing reviews that are only working to help your business finally hit its stride. The point is that the online reviews section for your business is important and something that shouldn't be ignored.
NerdWallet reports that as much as 45 percent of bricks-and-mortar customers will read the reviews section before they actually make a purchase. You don’t want to miss out on any potential new business just because you have people that are staining the reputation of your business with dishonest nonsense.
You want to make sure that you’re not falling prey to taking a scattershot approach when it comes to targeting your new customers through marketing and advertising efforts. You could implement something as simple as a checkout survey to further gauge the demographics and interests of your customers. From there, you’ll have that much easier time putting together something like a paid search campaign to target online users that could be easily convertible customers.
As a small business owner you don’t want to find yourself blindsided by the mounting costs of employees or inventory, and suddenly realize you don’t have sufficient financing. Take the time to ensure you have proper financing for your business.
Fundera points out that 48 percent of small businesses successfully meet their financing needs, 20 percent get loans, and then 28 percent end up without enough money if they didn’t receive a loan. This implies that as much as 52 percent of all small businesses end up getting no financing, or they’ll get a portion of what they actually needed.
For more small business tips, sign up for our free newsletters.
It's all well and good to make every attempt to exemplify a passionate business owner who lives and breathes for their business. However, there is something to be said about the additional strength and breakthroughs that come from remaining open to outside help. A report by the Business Development Bank fo Canada found that 86 percet of business firms that had advisory boards ended up seeing their sales increase by as much as 24 percent. Business productivity also reportedly increased by up to 18 percent.
Regardless of the market that you find yourself in as a small business owner, you're going to have competitors. Innovation is carried on the wings of constant competition, and there may come a time when your business has to reconfigure its approach to remain relevant.
A study conducted by a team at the startup incubator Station F determined that pivoting is essential for a company to continue onward successfully. Their data showed that 24.7 percent of the companies that were polled had altered their markets at one point or another. Even more fascinating, is that 16 percent of the companies polled were able to firmly establish themselves through making new deals. It’s never too late to approach success as a business through a new lens.
As a small business owner who is just starting out you don’t want to sacrifice precious time, energy, and money into onboarding new employees that never intended to have more than one foot in the door. According to SCORE’s employee engagement report 60.7 percent of small business owners classified hiring the proper talent as being the biggest challenge. From there, 45.8 percent of small business owners reported great difficulties in successfully retaining their staff. So, take your time and don’t rush through a comprehensive interviewing process with any new employees.
