The life of a business owner can prove to be a very exciting and financially fruitful time. It will also be a learning curve of good and bad decisions. Making mistakes is human nature, but make too many as a business owner and it will cost you dearly.
Owning a business isn’t a piece of cake. If it were we’d all be running successful companies. In reality, there are many different aspects of running and maintaining a business, so keeping everything organized and fully functional can be a tall order. Every company, no matter how high-profile, has made a few errors along the way — many of which could have easily been avoided.
Here are five mistakes that many business owners will make, along with how you can prevent yourself from making similar blunders.
1. Underestimating the Power of Marketing
Marketing was, is and will always be one of the most crucial elements of any successful venture. Whether it’s a company, an event, or any other endeavor that requires word of mouth to be successful, marketing will always prove to be worth the time and effort.
In an era where branding is an essential part of every industry, the ability to establish your business as a brand is crucial. Doing so will take time, effort, creativity and, of course, an effective marketing strategy.
In the past, businesses would rely on massive marketing budgets if they were to stand any chance of competing with the name names. But in the digital era, the most effective marketing tool is absolutely free. Social media and the web presence of a company are right at your fingertips—and it would be foolish to ignore such an efficient way to build your brand.
2. Having a ‘Get Rich Quick’ Mentality
Although getting rich quickly would be the ideal scenario, the chances of it actually happening are slim. Even Bill Gates had to start somewhere and suffer a few hardships along his journey. Building a small business from scratch takes time and a whole load of perseverance, because it will probably be a while before you’re even a profitable company, let alone a thriving one.
It’s often for this reason that business owners become disheartened with the slow progression of a company, leading to them being less productive and, in some cases, giving up altogether.
While overnight success is a delightful sentiment, it’s a near impossible feat in the modern business world. New businesses are appearing all the time and making every industry all the more competitive. This increase in competition is why companies need to strive for longevity, rather than making some quick cash.
3. Being an Army of One
Even if you’re the sole owner of a company, the head honcho, the person whose name is above the door, it doesn’t mean you have to go it alone. While there’s no doubt that you can handle the majority of the tasks involved with running a business, there’s no guarantee that you’ll be doing so at a high level.
A perfect example of this is the reluctance to outsource bookkeeping or accounting. Business owners often see it as a waste of money to pay someone for a job you can do yourself. In reality, though, the services of a tax accountant for small business and the peace of mind when tax return deadlines approach is invaluable.
Every business owner will have specific aspects of running a company in which they excel, but others where they are average at best. If you want your business to be as diverse and creative as possible, you need every department to be as efficient as the next. To do so, you’ll find that outsourcing will be a crucial element of business success.
4. All Business, No Pleasure
Running a business will take up a lot of your time, especially in the early days when you’re working to establish yourself as a brand and all hands are on deck to make a profit. Although this will require a lot of effort and plenty of time, it would be a mistake to let business take up all of your time.
Budding entrepreneurs often make the mistake of putting their social lives on the back burner, while business dictates the way they spend the majority of their time. This may seem like a necessary sacrifice to make your company a success, but you’ll soon find that doing so will have a negative effect on the day-to-day atmosphere of your business, as well as your personal life.
Balancing the time you spend working and the time you spend with family and friends will be crucial for the longevity of a positive business mindset. This positivity will shine through in the way you act as a leader and make the workplace a much more productive environment for your employees.
5. Setting Unrealistic Goals
Just as in your personal life, it bodes well to set yourself goals in your business ventures. This will give you something to work towards and, once achieved, experience the great feeling that comes with success.
It’s vital to always look for ways to expand your business and seek out new opportunities, but you should also set yourself some short-term goals that are achievable and won’t force you to diminish your tight budget.
Long-term goals are very different for every company, some will prioritize their customer service and quality of products and make sure to maintain this over a long period. While others look ahead and strive to expand their company.
Attempting grand-scale goals without the right resources will be an uphill struggle. Most likely, you’ll come away disappointed, as well as putting a hefty dent in the budget you’ve worked hard to build up.
It’s said that business is a dog-eat-dog world, but it’s not uncommon for a company to experience self-sabotage from time to time. Making mistakes is part of life and, unfortunately, part of being a business owner, too. Although you will learn from your mistakes, it’s always more beneficial to avoid them wherever possible.
Author: Chris Weston is the Director of Milton Keynes-based accountancy firm Aston Black. Chris has over 25 years of experience in accounting and taxation, working with his small team of staff to provide quality advice for small businesses up and down the country.