You can’t figure out what’s wrong. The business you’ve longed for is finally up and running, but money’s flying out much faster than it’s coming in.
Don’t be too hard on yourself – business blunders are made by the majority of new SME owners. The trick lies in first identifying the problems and then attempting to fix them up, while there’s still time to turn the business around.
These are the seven main culprits when it comes to new business mistakes.
Failing to do your market research
You might think you know what the market wants, but have you actually checked? Never assume there will be a perfect niche for your product or service; the business graveyard is littered with the corpses of the blissfully unaware. Have you watched Dragon’s Den or Shark Tank lately? It can be quite a shock when someone in the know bursts your bubble. Your ‘must have’ innovation might already be out there in the marketplace, or it has a significant drawback you hadn’t anticipated.
Ignoring your competitors
Again, without doing proper research, you can’t possibly know the ins and outs of what your trade or industry competitors are offering. Trawl through their websites – every page – along with the websites of authorities in your industry field. Compare pricing too. Don’t undersell, or price yourself out of the market.
Wasting money on the wrong kind of advertising
Scattergun, poorly conceived advertising will simply be overlooked in an already crowded marketplace. Money in the advertising pot is precious, so make sure you spend it wisely. Leaflets in letterboxes still have their place, but modern businesses have the entire gamut of social media to choose from too. The right people need to see, understand and – most importantly – buy the thing you offer.
Neglecting cash flow
Cash flow, put simply, is the be-all and end-all for small business. New traders too often concentrate on spending money rather than bringing it in.
Excited by branding, design, name and image, it’s all too easy to overlook the stark reality of the marketplace. Look good on paper? Theoretically profitable businesses go bankrupt every day. Don’t be one of them!
Not bothering to set up a business website or use social media
Websites are so cheap now, there’s no excuse for a new business not to have one. They are a minimum requirement for the modern trader. Take the time to explore social media and find out how to use it. It’s fast becoming an essential way to promote your business to existing and potential customers. Overlooking digital technology
There’s no escaping it. It’s not just a thing of the future any more – it’s here and now. Here are a few ways to use it in your business.
Not getting proper banking and accounting advice
- Switch to online faxing: Internet fax is your new virtual office. Portable and paperless with global reach, send faxes via your computer, mobile or tablet.
- Cloud-based technology: Store your data on the cloud and never worry about backing up or server breakdown again.
- Smart numbers and phone words: Make your business number extra-memorable and stand out from the crowd.
Make sure you have an experienced business banker and accountant to help guide you through the financial maze.
So put excuses and self-recrimination aside. Do some serious homework, and give your business every chance to get established and grow.