Many small businesses fail because they make certain basic errors. Hard work and a great business idea will not save a company if it makes one of these mistakes. This article reviews five key small business errors and explains how to avoid making them.
Small business owners face many challenges. Hard work and perseverance are sufficient to overcome most of these obstacles. However, certain basic business errors can sink any small company, no matter how hard you work. Here are five such errors along with advice about how to avoid them.
- Lacking a strategic plan. It is not enough to have a strong vision and a wonderful product (or service). You must also develop a plan to transform that vision into a successful business. If you don’t have the educational background (normally an MBA or equivalent) to do that yourself, you should acquire the necessary personnel to do it for you.
- Forgetting about your customers/clients. Whatever you do, it’s essential to maintain an awareness of your customers and their needs. For instance, if you decide to reduce product quality in order to increase your profit margin that has an effect upon you customers. You shouldn’t be surprised if some customers abandon you. No major business decision should be made without considering the response of your customers.
- Lacking a focus on hiring. Sometimes small business owners feel that it doesn’t matter who they hire for various roles, as long as the product is great and the marketing is effective. This is a big mistake. Whatever product (or service) you are selling, your employees are the face of your business. In many ways, large and small, they influence how customers feel about your company. You should always invest the time and effort necessary to find the very best people available.
- Doing insufficient industry/sector research. It’s wonderful to have a great product and a strategic plan. However, if you don’t do enough research into the industry and the sector, it’s unlikely your company will be successful in the long run. You need to have a thorough understanding of your competitors and their products. You also need to know everything possible about supplies, suppliers, and distribution. This is another area where hiring people with the right expertise may be necessary if you don’t have the time and/or the background to do such research yourself.
- Lacking marketing support. Once you try to move beyond your early customers to attract a broader clientele, word-of-mouth won’t suffice. If you expect your small business to survive over the long term, you’ll need to develop a marketing campaign that educates potential customers and convinces them to purchase your product. This can be expensive, but the money is well spent.
Creating and running a successful small business involve hard work and personal sacrifice. To ensure that all your work and sacrifices are not wasted, it is imperative to avoid making these common small business errors.
Heidi Kim is a professional business consultant and legal researcher focusing on business laws. She is passionate in helping those who have any queries regarding business laws and how these may affect their respective businesses. Follow on twitter @gehreslawatty