Starting a business is exciting, fun, stressful, mysterious, and tricky. One thing I have noticed and love is that all businesses want to live and strive. In most cases if you work hard and stick to the format of success it will happen. So why does most small businesses still fail? In an economy always looking for something better and smarter to come to life, we are in a generation made for new companies to do well in. We literally thirst for new companies.
With all this opportunity and the millions of tools and help available for your business, you have ask again… how are businesses not popping up making millions everyday?
A quick reality check will show that 543,000 new businesses start each month in the US, this doesn’t help. Also over 27 million small businesses already exist in the US, which is a whole lot.
So now we have great and not so great circumstances. Bottom line is a lot of new businesses survive and even take off faster than a jackrabbit on a hot date, this can and should be you. And end the end only one thing will matter…
You, the owner. In the end if a business closes down and they look back, it’s because of the owner made mistakes. Now don’t be hard on yourself, we all make mistakes, and knowing what to do correctly is getting more and more convoluted. Wouldn’t it be amazing if there was one book that we could all follow to make our business work and grow. Ahhh such wishful thinking. For me, I’ve learned that focusing on what I need to do for my business is not nearly as important as what not do do. After all… the business wants to succeed, it wants to grow. It just the continual mistakes that can make it fail. And in the end you can’t blame anyone but yourself for making these mistakes. With thousands of things you can do to help your business, there far fewer mistakes you should be more concerned with.
Even though hundreds of things that can go wrong with your new business, I can only tell you from experience some things will have a substantially bigger impact on new business performance than others.
My top 6 mistakes new businesses make that can lead to failure.
When you start your new company, you are going to want it to look good and you’ll want to get talent to eventually free you up from all the work. As great as this sounds, new businesses need capital. Every penny you spend on furniture, having fun, and new computers is money you should be spending and perfecting your service or product, customer service, and marketing. These are the only things that will keep you alive in the long run. Hold off on any expenses you can spare and lock down your business essentials first. Fancy chairs and a new big offices should be an award not a necessity.
You are going to see a million of new books, movies, events, and resources that want your time. Remember though, time is the ultimate currency in business. Stay focused on your core function, find what converts, and keep making that better. You’ll have plenty of time to do events and join groups later when you have stabilized your company.
I wish I could say I was 100% sure all my businesses would be amazing and might not fail. The truth is each one has had moments of doubt which has effected my performance. It wastes time, it prevent you from taking risks, and most of all it will slow down momentum. Stay positive no matter how difficult things seem. Persevere up until you reach your golden goal (normally 10k a month in profits) and stay confident, focused, and without doubt. I like the idea of crashing into my goals rather than gracefully walking there.
Not being reasonable
New businesses take time to grow. I can’t tell you how may times I have seen people start their business and expect to make a ton of cash right away. It’s really more like you lose money at first, slowly break even, and exponentially grow. The great part is, the longer you do well the faster it will grow on it’s own. Word to mouth, lower costs, and brand recognition come in time. Be patient and stay the course!
With the Internet, there is now an unprecedented opportunity to start businesses with zero capital. Something unheard of up to the 90’s. In fact before the 90’s most small business owners worked harder than most people with normal 9 to 5’s. The tables have turned with eCommerce, now the ability to turn any business into a global service is nothing short of amazing.
The issue is that this is so tempting to bootstrap everything to cost near nothing. The reality is almost all businesses need money to grow. Don’t shy away from investing on a better name, better tech to run the business, and marketing that you know will do well.
Not asking the right questions to the right people
For the first couple years I grinded my way to profit. I assume no one would want to help me when they are in the same industry. It wasn’t until years later I was surprised to learn how many successful business people were open with helping me do better. Now 19 years after my first business I understand their perspective. Helping others help you feel better.
Don’t be afraid to ask anyone questions that can help you and your business.
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