When starting a new business, we all have big dreams, but the reality is that only 50% of new businesses last more than 5 years and only a third of those businesses last more than 10 years.
Will yours be a story of failure or long-term success?
Instead of fearing possible failure you have the opportunity to learn and grow from other business owners’ mistakes to ensure your own success.
We have done a lot of research for you, tapping into international and local resources to provide you with the top 5 mistakes new business owners make and how to avoid it, as well as sharing some of our own mistakes
Always try to learn from other people’s mistakes, it’s much cheaper that way. Donald Trump's quote especially rings true when starting your own company.
When doing our research, we were surprised to learn that even though the owners and business models differ vastly from one entrepreneur to the next, the most common mistakes were always the same.
Which is actually great news, this means that if you can avoid them you are much more likely to succeed and build a long lasting profitable business.
Being profitable simply means that you make more than you spend in your business.
This brings me to the first mistake most new business owners make.
#1: Overspending and underearning
Now you might be thinking it takes time for a new business to generate a substantial income. That is true and it’s exactly why you need to build up various income streams and focus on creating passive income producing assets
This will allow you to focus on building a strong and lasting business, instead of making bad business decisions based on fear and desperation. It also allows you to spend money on business growth and outsourcing. It can also help you survive any slow months that you might have during the startup or growth phase of your business.
Overspending can be just as harmful to a growing company.
Startups do require financial investment, but some new business owners feel that they need to spend a lot to purchase the best of the best everything from marketing help to equipment, to software. There are usually other, less expensive or sometimes free and equally viable options available, if you're willing to do the research.
You need to ensure that you:
· Keep your overheads low, outsource if possible.
· Create and stick to a business budget, everything needs to be accounted for.
· Use free versions of software until you can scale your business.
#2: Not doing proper market research
You would be surprised to know how many new business owners have no idea who their competitors are let alone their ideal client.
When doing market research, you need to:
Look at the entire industry and potential market, who are your strongest competitors?
Who are your indirect rivals offering different solutions to the same audience?
Who is your target market, what problem are you solving for them and how can you stand out amongst your competitors?
When looking at competitors don't just look at other SMEs. Research three to four aspirational brands, brands you want to be when your company grows up.
You can only become the best when you learn from and associate with the best.
Then you need to determine who your ideal client is if you want to know more. We created a great video and free workbook to help you with identifying your ideal customer.
#3: Not allocating enough time or resources to your online marketing
71% of consumers who have had a good social media service experience with a brand are likely to recommend it to others. This shows the importance of social media in businesses. In order to maintain a competitive pace, businesses are bound to leverage popular social media platforms.
Many business owners think that they are able to grow their business whilst managing their online presence and marketing.
Online marketing efforts rarely end wrong; they usually start wrong. Ensuring your social media marketing is successful, you require a few key components:
You need to have a marketing and content strategy.
You need to know what sets you apart and how to portray yourself and your unique value proposition in a professional manner.
You need to ensure that everything you post has a purpose and that you are posting on the right social media channels.
You need to be consistent.
You should aim to spend around 20 hours per month on your digital marketing as a new business. That’s a lot, so don't try and do it all alone. If you don't have time to do it all, hire a professional to manage your presence and marketing so you can focus on building your business.
#4: Having a rigid or no business strategy at all
Entrepreneurs are so busy building their business that they forget to take some time to determine their long-term and short-term business goals and how to get there step by step.
Some business owners have a business strategy but when it doesn't work, they want to give up. This is where a growth mindset is key and realizing that as an entrepreneur you will probably need to pivot your plan and strategy quite regularly.
The question is not should you adapt your strategy, but rather how quickly you can adapt.
This is where a business coach can really help but if you don't have one, you can formulate a winning strategy by:
Determining your main goal or goals and then working backwards on how to get there.
Setting a timeline, don't be vague!
Create realistic goals and tasks and be clear about task allocation
And as mentioned before if you get feedback or hit a wall adapt don't give up.
#5: You picked the wrong business for the wrong reason
If money is your only goal, you simply won't be successful. Don't get me wrong, money is important but if that is the only reason you started you are likely to fail. Let's look at some of the big and successful entrepreneurs, Steve Jobs, Bill Gates, Oprah Winfrey - they all had a much bigger goal and drive than money. That not only comes across to clients, but it also sustains you when you go through tough times
If you have just started your business and you need help with your strategy or looking for a team to manage your social marketing head on over to our website for a full scope of what we offer . To contact us just fill in your details on our website, and we will set up a call.