Starting your very first business can be a heady rush. The excitement of knowing you’re about to make your dreams come true can threaten to overwhelm everything, including your logical brain, and you can get caught up in the moment easily.
When that happens, it can often also mean that you overlook simple, common mistakes that many business owners frequently make, through no fault of their own; they’re just thrilled to finally be out from under their boss’ shadow.
If you’re thinking of starting a business and you want to make sure you don’t get something simple wrong, then read on. Here are 10 common mistakes first-time business owners make!
1. Focusing too much on innovation
Many business owners tie themselves in knots trying to figure out how they can innovate and create a business that’s completely different to anything they’ve seen before.
The fact is that you don’t need to do this; you can create a business that simply fills a niche in your particular market and still be successful. That business doesn’t have to be a completely fresh or new idea.
Generally speaking, most business ideas have likely been done before, so finding a business that serves the community is more important than relentless innovation.
2. Not looking into every source of funding
If you apply for a business loan and are rejected, it doesn’t feel good, but that absolutely doesn’t mean you should give up.
When a business loan isn’t the right way forward, there’s nothing stopping you from fronting some of your own cash to start your business. You could even look at personal loans as a way to build the cash you need.
Once your business is successful, you can then start paying those loans back. Make sure you don’t take out loans if you’re not sure you can repay them, though; that way lies trouble.
3. Being too hostile to rivals
Your business rivals don’t have to be bitter enemies. In fact, they’re probably better served as friends.
If you can cooperate with your rivals – or, at the very least, discuss things with them in a rational and level-headed way – then you’ll build more bridges, and those bridges might come in handy later down the line.
Being hostile and antagonistic towards fellow businesses will just make you come across as spiteful and overly competitive. There’s nothing wrong with healthy competition, but don’t let it consume you.
4. Not conducting enough market research
It’s easy to bluster into the business world convinced that you’re going to represent some kind of disruptive force.
However, if you haven’t done enough market research, those attempts to disrupt the market could fizzle out as you realise your attempts to fill a niche are potentially ill-judged or poorly-pitched.
Conduct extensive market research before committing to a business plan. If you don’t, you may find that the dream you had doesn’t quite fit together as nicely as you thought it might.
5. Not networking enough
Remember when we said it was important not to be too hostile to rivals? That’s largely because it’s more important to network with them.
If you can create a network with your rivals, then when the industry changes – and it will, because they always do – you’ll have friends with whom you can band together and potentially survive the newly hostile business conditions.
Networking is important, and not just for recruiting new staff or getting additional suppliers. It’s also good for making friends, which is more beneficial than making enemies.
6. Not creating a business plan
Believe it or not, many business owners start their business without creating a solid business plan, and as you might expect, it comes back to haunt them later.
If you’re looking for external investment for your business, investors will often require a thorough business plan before they’ll consider contributing any cash, which is just another reason to draw up a foolproof business plan.
Your plan should be comprehensive, exhaustive, and easy to understand for any potential investor who wants to understand what you’re about at a glance.
7. Neglecting the legal side of things
Nobody wants to deal with the legal side of running a business. It’s an absolute headache, and it can be incredibly tedious to sift through endless rules and regulations.
If you don’t accommodate this part of running a business, though, you’ll quickly find out why considering the legal angle is important, as you’re bound to fall foul of some arcane rule you didn’t know about.
Many experts recommend hiring a dedicated business lawyer to help you with this part of the process.
8. Overly relying on AI
AI represents a potentially exciting new tool in the world of business. You might be able to use it to streamline processes or make payroll easier to manage, for instance.
One area where you should never use AI, however, is content generation; search engines often look unkindly on this practice, and you might find your reputation suffering as a result.
Treat AI as an augmentation for your business and not a replacement and you’ll do just fine.
9. Neglecting branding
Your product or service should, of course, speak for itself, but unfortunately, that’s not always the way things work in the world of business.
You’re going to need strong branding if you want to succeed, which means building a clear identity for your business, as well as an in-house style when it comes to content.
That branding should then inform everything you do across marketing, content generation, and design.
10. Maintaining a pessimistic outlook
As a business owner, you can’t afford to be pessimistic, even when you suffer a setback that might ruin most other business owners.
Instead, you should always be looking to the future. Treat every potential stumbling block as a learning opportunity or an obstacle that you must surmount in order to proceed.
Being too pessimistic will just make you want to give up early, and then your business is effectively doomed.