As reported by the U.S. Bureau of Labor Statistics, 20% of new businesses fail during the first two years of operation, and roughly half of all businesses don’t survive past the fifth year. Then the question comes to mind, why do businesses fail? And how can I avoid the mistakes as an entrepreneur?
While some mistakes are unavoidable for first-time entrepreneurs, fortunately, you can plan for some of them. This article will walk you through some common mistakes, and tips for avoiding failure in business.
10 Mistakes You Should Avoid as an Entrepreneur
Whether you’re a first-time entrepreneur your first or fifth business, prevention is key. Here are the top 10 most common mistakes entrepreneurs make, and how you can avoid them:
1. Ditching a Business Plan
2. Not Branding
3. Waiting on Free Traffic
4. Not Automating Sales
5. Not Incorporating Your Business
6. Keeping Blind to Competition
7. Mixing Personal finance With Corporate Finance
8. Hiring the Wrong People
9. Risk Aversion
10. Being All Business, All the Time
1. Not having a business Plan
If you fail to plan, you plan to fail. I understand that writing a business plan sucks! for an entrepreneur, it’s even worse. However, business plans are like road maps: it’s possible to travel without one, but that will only increase the odds of getting lost along the way. Writing a business plan helps you see the world the way it is, you merge your obsession with reality.
For context; A business plan is a 15–20 page document that describes in detail how you define your business objectives and how it is to go about achieving its goals. A business plan lays out a written roadmap for the firm from marketing, financial, and operational standpoints.
You leave so much on the table when you don’t have a business plan. Such as having Clarity, a grasp of the competition, raising capital for the business, and Keeping track of accomplishments.
Check out our blog for more information on writing a killer business plan for your business.
2. Not Branding
What do Google, Nike, Patron, Coca-Cola, Starbucks, Apple, L’Oreal, and Gillette have in common? They have such a strong brand that it cannot be separated from the product itself.
Google is synonymous with Search, Nike with Athletic Shoes, Patron with Tequila, Coca-Cola with Soft drinks, Starbucks with Coffee, Apple with Smartphones, L’Oreal with Makeup, and Gillette with Razors.
In today’s market, winning products are bought not sold. Consumers no longer buy unknown products, and most entrepreneurs fail to realize this truth.
Direct marketing is killing your brand, little wonder why you are even forced to run a 90% discount.
Invest in your brand, and communicate your brand’s story. That is all you can bank on in the long run.
3. Waiting on Free Traffic
“If you build it, they will come.” This is a common belief (sometimes conscious, sometimes not) among first-time entrepreneurs. You think that your products are so revolutionary that you can just rely on free PR and word of mouth.
Organic traffic has been facing a continuous decline year over year. It’s high time businesses stop waiting on free traffic or organic reach. That’s not a sustainable strategy.
Hit the promote button, and reach as many possible people as you can. Deploy social media advertising, deploy influencer marketing, deploy affiliate marketing, and make the most of email marketing. Remember no traffic, no business. Attention is worth every dime, ‘’get it with all thy gettings’’.
4. Not Automating Sales
The ultimate goal of entrepreneurship is freedom. You have to set up your business on autopilot so sales can rain whether you are there or not. Automate every aspect of your business.
People buy online, their Mastercard is up for use, allow them to use it to pay for your products. Let them buy your Creams, Jewelry, Hair, Clothes, Shoes, Bags, or any other products you’re selling on your Website.
5. Not incorporating your business
One of the biggest mistakes that entrepreneurs make is not registering their business or protecting their intellectual property. These two areas are crucial to a business starting right, where if not done properly, will cost valuable time and money to correct.”
Treat this a must, Incorporate the business, secure necessary licenses, and trademark every IP(Intellectual Property). Set your tax in order, so you do not run into issues with the government.
6. Keeping blind to competition
Keeping blind to competitors is a crime in business. Prioritize the customer, but keep a watching eye on the competition.
You can learn a whole lot from your competitors’ failures and mistakes. Be cognizant of the new innovation and features that are working out for them.
7. Mixing personal finance from corporate finance
Your finance is different from your business finance. You should set out an amount as your salary. Stop financing your lifestyle with your working capital. You should realize the thin line before is too late.
Your finance is different from your business finance. You should set out an amount as your salary. Stop financing your lifestyle with your working capital. You should realize the thin line before is too late.
8. Hiring the wrong people
Hire staffs you can fire. Hiring people you can’t fire will lead you to utmost frustration. Staffs that are family members or friends often fall into this category. Entrepreneurs should not be afraid of making the tough call.
“Different skill sets and backgrounds are needed for the different positions you’ll want to fill. When you get started, make sure you have hard-working, all-around generalists who can do everything you need them to [do]. When you begin to grow, look at hiring those who are specialized for the roles that need a specialist. Don’t hire a generalist when you need someone who is specialized, and don’t hire a specialist when you could hire a generalist to do it.” — Devin Miller, attorney, founder, chief executive officer, and managing partner, Miller IP Law
9. Risk Aversion
Most entrepreneurs fail at this woefully. Often I see most Instagram vendors’ bio, No exchange, No refund.
What most entrepreneurs fail to realize is that such policies are red flags to customers. Clients have 1,000 other options.
Risk reversal policies like Money Back Guarantee: The most common form of this type of guarantee is the ever-so-popular “30-day money-back guarantee.”
Cash on delivery is another risk reversal strategy you can adopt. The goal is to take off the risk from your clients.
Also, you don’t need to wait for 30 days to ship customers' orders. You can offer same-day shipping.
10. Being All Business, All the Time
Many entrepreneurs put their personal lives on hold to focus exclusively on their businesses. Ultimately, both suffer. There is no question your business needs your full attention and effort, but only in short spurts. Just like an elite athlete in training, you need to have a proper, healthy diet, get enough rest, and take breaks. Balance your personal and business life, and you will actually do better in both.
Bottom line
Occasional mistakes are inevitable, especially for first-time and second-time entrepreneurs. So don’t be afraid of failure; instead, learn from your mistakes and pivot your business model as needed. Test new ideas and acquire feedback so you can tweak your product to better meet customers’ needs.
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2 months ago
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02-June-2022
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02-June-2022
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2 months ago
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02-June-2022
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2 months ago
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2 months ago
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2 months ago
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2 months ago
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03-June-2022
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2 months ago
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03-June-2022
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2 months ago
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03-June-2022
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2 months ago
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03-June-2022
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2 months ago
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03-June-2022
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2 months ago
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03-June-2022
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2 months ago
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03-June-2022
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03-June-2022
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2 months ago
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2 months ago
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03-June-2022
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03-June-2022
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2 months ago
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04-June-2022
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2 months ago
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04-June-2022
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2 months ago
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04-June-2022
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2 months ago
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04-June-2022
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2 months ago
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04-June-2022
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2 months ago
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04-June-2022
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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05-June-2022
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2 months ago
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06-June-2022
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2 months ago
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06-June-2022
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2 months ago
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06-June-2022
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2 months ago
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06-June-2022
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06-June-2022
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06-June-2022
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06-June-2022
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06-June-2022
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2 months ago
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06-June-2022
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06-June-2022
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2 months ago
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2 months ago
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06-June-2022
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06-June-2022
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06-June-2022
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06-June-2022
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2 months ago
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06-June-2022
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2 months ago
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06-June-2022
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06-June-2022
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2 months ago
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06-June-2022
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2 months ago
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07-June-2022
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2 months ago
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07-June-2022
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2 months ago
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07-June-2022
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2 months ago
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07-June-2022
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07-June-2022
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07-June-2022
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07-June-2022
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2 months ago
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07-June-2022
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07-June-2022
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07-June-2022
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07-June-2022
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07-June-2022
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07-June-2022
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2 months ago
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08-June-2022
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2 months ago
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08-June-2022
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08-June-2022
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2 months ago
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08-June-2022
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08-June-2022
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2 months ago
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08-June-2022
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2 months ago
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09-June-2022
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2 months ago
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09-June-2022
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2 months ago
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09-June-2022
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09-June-2022
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09-June-2022
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