Entrepreneurial, There is no shortage of individuals with great ideas. There is, however, a massive shortage of individuals who can execute great ideas.
The gap between idea creation and execution is often not the individual’s fault with the ideas, most of whom are working full time, possibly raising a family, and have limited resources and skills to get started. More often than not, majority of an entrepreneur doesn’t have experience with starting a business.
There are certain pitfalls, and traps entrepreneurs can easily fall into that can ruin your health, your relationships, as well as your overall happiness. We felt it could be helpful if we put together a short synopsis of common business struggles, a “pocket guide” to ensuring you’re taking all the steps necessary to keep your business on track and growing.
Here are 7 traps we often see business owners fall into and how you can avoid falling victim:
Skipping Market Research
Market research is an integral step in a successful business development effort, whether you are part of a startup, launching a new product, or rebranding your business.
When you skip out on market research, you miss valuable opportunities that will help your business in the long run. Successful business owners know their markets, understand their competitors’ and customers’ wants and needs, and gather all the information necessary for their businesses to be competitive. They know why people buy their products and services, not just when or where. Neglecting to do market research can result in indecision and inaction, fear of risk or the truth, and/or too many options, leading to paralysis.
You’ll need to gain insight from various people and sources to ensure the market is ready for your product or service your business intends to fill. Sometimes businesses skip the market research step because they do not know what to look for or don’t know what’s missing from their thought process. Having a list of burning questions that you want or need answers to is a good starting point instead of blindly researching your industry with the hope of stumbling across something useful.
No Business Plan in Place
A business plan is an integral part of any business. It would help if you had a practical business plan that outlines market research and their competition, product prices, how you’ll grow your management team, and what rate you believe you can take on market share and grow revenue.
It’s far too common to introduce a poorly crafted business plan to an investor, partner, or client that would’ve invested in your business if they perused through a well-calculated means of achieving your long-term vision.
You can either create your business plan yourself or use tools like a life plan to help you; a proper business plan should be the first step you take before setting up a business. The plan should address both the macro and micro levels of your new venture.
Your plan should be broad enough to incorporate your big picture goals but detailed enough to give you specific, month-by-month instructions on accomplishing those goals. Without direction, there is no way you’ll accomplish your goals.
Doing things only for money.
One of the most exciting things about being an entrepreneur, and one of the reasons you probably became one yourself, is unlimited potential. We can sell to more customers; we can create more products. The possibilities are endless. However, if you approach business with a money-first (profit-oriented) approach and that’s all you think about, you’re most likely going to lose. You may see the huge money-making opportunities, go for them, and 5 years down the line, you will lose passion for the business. Because you are chasing the money first, you will end up losing money. You lost money because you lost your focus. Your focus should be on helping other people first and foremost serve a need or problem. My philosophy is that your earnings should be the result of how well you serve your customers.
Working with personal bias
As humans, most of us will put our own personal biases into the products, solutions, and content we’re creating without even knowing we are doing so. Yes, we have our own needs & experiences, and we should absolutely feel free to share them or need them, but assuming that what we have to offer or our need is what your customers want is the wrong approach. You need to remove the guesswork as much as possible, do your research, and work with what you found out. A lack of proper research kills more businesses than anything else.
Expecting to get rich quick
All you see in the media or social media is someone that has succeeded in one business or another; it’s easy to read or listen to one of these stories and start comparing yourselves to that success. But if you actually take a moment to do some research behind these sudden success stories, you realize they were not sudden in the slightest. In fact, their success actually took years of work, grinding, and effort. All I have to tell you is that success takes time. Many people refuse to keep going because they think the entrepreneurial world isn’t right for them after only a few months of not succeeding. In reality, they were probably very close to their breakthrough point where things were going to start to grow.
Not Investing Enough into Marketing
Marketing should always be looked at as an investment and never an expense. Any well planned and executed marketing campaign will show twice on a financial statement (P&L); as an expense and a connection to increased revenue.
Too many companies look at marketing campaigns as an extra expense and a burden instead of a core business sales representative. If you don’t have an idea on how to go about your marketing, a quick search on Google for “best marketing tips for 2020” or “how to market clothing business” will each pull up hundreds of articles.
Read these articles! Make an Excel list of the various forms of marketing and track ROI manually if needed. Whatever you do, don’t lose hope, and don’t go into this blinding, or your competition will crush your business even before you startup…
No proper bookkeeping
Proper bookkeeping/accounting is essential as you focus on growing your business. If you cannot do proper accounting, you can employ someone who can help you reconcile your books monthly.
Secondly, you should have a thorough understanding of your own books and financials. Once this process starts, you’re well on your way towards utilizing your QuickBooks account as a valuable asset towards setting up growth plans, budgetary cuts, hiring, terminating, growing one division while shrinking another, etc.