They say if you do what you love you won’t have to work a day in your life. However, what it is that you’re passionate about will require much resources such as time and efforts in order to turn it into a lucrative business. Launching your own business can be incredibly profitable, but many first-time entrepreneurs make mistakes when starting a business. Building a business from scratch doesn’t leave a much room for error. It is very hard, but you can succeed against the odds.
Thinking of a few things will boost the odds of being successful by avoiding the mistakes that have already been made by other entrepreneurs. You don’t have to reinvent the wheel, learn a lot from those that came before you. That’s what smart business owners do. Below are five common mistakes to avoid.
- Not having a good enough reason to start the business in the first place.
You may really love your passion but it may not be enough to help you succeed. You must have a strong “WHY” when you’re starting a business. WHY means What Has You. Does something have you so strong that you will have the same desire to carry on when times are tough. You’ll want to have a big enough reason “why” to overcome your many “buts.”
Your reason for starting your business must be clear and something that makes you want to get out of bed in the morning because it motivates you, it is exciting to you. An exciting reason will make the hard times less challenging.
2. Making the assumption that the banks will be happy to lend money to you.
New businesses have a less than stellar rate of success and banks need to know that they aren’t making a loan to a business that is going to fail. So, banks can be reluctant to fund new business ventures that don’t have the numbers to back up their request for loans. Banks have gotten especially stingy with lending practices since the downturn in the economy.
Many non-commercial banks make it easier for self-employed professionals to obtain business loans. So, doctors, dentists, or accountants, who are looking to open an office might have better luck getting a loan.
Lenders are also requiring business owners to put up collateral. Banks need to know that there is something of value they can take should you become unable to make your payments. So, many new businesses rely on personal assets such as savings, gifts from friends, and credits card in order to launch their business. Think it over to make sure whether you think it’s a wise move to invest your life savings in a business that not succeed.
3. Making the assumption that customers will automatically find you and start buying your product or service.
You need to have plan to reach your market. You have an almost unlimited ability to reach potential customers in the age of social media. Keep in mind that customers aren’t actively looking for you. So, you have to make the effort in reaching out to them and you have to market to them multiple times before you convert them into 1st time customers.
4. Not having a clear exit strategy.
This is important point and a mistake that you must not make. You should start with the end in mind. In fact, this is one of the principles that highly effective people live by. At some point, the business may grow beyond your ability to manage or you may want to take your life into a different direction. It might be nice to unload the business and capitalize on what you’ve built. Businesses aren’t easy to sell and only 10 percent that are put up for sale actually get sold.
5. Not getting support before you get started
Running a business puts unimaginable demands on your time. Most of the times you are the first person there and the last person to leave. In the end, you may have to put in upwards of 80 hours per week. More often than not you’re also the CEO, COO, CFO, the jack of all trade for your business. While you are trying to be Mr Everything, you may also have miss family events and children activities. The new venture may also demand that you skip vacations and delay other plans. Truth is, everyone around you will be affected by your quest to make your business successful.
Building your own business and getting it off the ground can be quite challenging. However, the rewards can be incredible.
With some proper planning and foresight, you could earn far more money than you ever dreamed and possibly spend less time working than you would at a conventional job.
But that success isn’t easy to achieve. One way to boost the odds is to avoid the common mistakes made by many other entrepreneurs. Avoid these 5 mistakes and you’ll give yourself a better chance at living the American dream.