Owning and operating your own small business can be brutal. With heavy hitters and mega-corporations looming over your head like ancient gods of commerce, it’s easy to feel out of your league.
And you should; some statistics indicate that over 80% of all small businesses fail in the first year. So what do you have to do to keep your fledgling company in that coveted upper percentile? You can start by checking out this list of common mistakes that many small business owners make.
4 Most Common Mistakes Small Businesses Make
1. They Have Ineffectual Leadership
As the head of your small business, most—if not all—of your success depends entirely on you. Small business leadership requires time, effort, integrity, and above all, the ability to motive one’s self and others. Don’t be the kind of leader who can’t make a decision; be strong for your company without being obstinate. More than anything, make sure that you understand every nuance of your business. If you’re out of touch with your company, you’re basically flying blind.
2. They’re Out of Touch With the Market
Your company is only part of the great eco-system that is business; the other portion resides in the market. The market will play a major part in your business’s success or failure, so do some research and figure it out. Before you ever lease out an office or hire an employee, check and see if there is a demand for the service or product that you want to supply. Check out current trends and see if your potential clients\customers will be able to sustain your company and allow you to generate profit.
3. They’re Not Adaptable
Industries have been known to change very quickly. Hewlett-Packard may be best known for its computers and printers, but it started off by producing audio oscillators. Don’t get so focused on your current products and customer base that you forget to look ahead to the future. Your small business leadership should be flexible and adaptable. Companies like Hollywood Video would have completely disappeared had they not reinvented themselves to survive in the digital age. After all, there’s a reason you don’t see many new movie rental stores opening up these days.
4. They’re Stupid With Money
Everyone knows that you need money to open a business; what people seem to forget is that you also need money to keep a business open. Ideally, that money should come from the business itself. If you find yourself lucky enough to actually generate some prophet in your first few months, reinvest it. Don’t go out and buy a new home because you think that, as the president of a thriving company, you deserve it. The first ten years are the most dangerous for any startup, so tighten your belt and look forward to better times ahead. The money you reinvest now will come back to you once your company is out of the woods. At the same time, don’t skimp on important things just so you can save a buck. Insurance may seem like a total waste of money, right up until you need it. Then it becomes the most absolutely important thing in the world.
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