Before You Get Started With A Business
Avoid the following mistakes that kill a business before it starts.
You don’t have a business plan. This plan outlines what you’re selling, to what demographic and why, for how much, and your strategy to grow the business. Never made a business plan before? There are plenty of free planning templates online. The more clear the plan, the better. That doesn’t mean it needs to be long, by the way. But, the plan does need to demonstrate that you have a solution to a pesky problem, because that’s what sells.
Launching without proof that anyone wants your product or service. That’s right! You’re going to need to do research on the size of your market, and get out there and test the real product, or service, with real potential customers. Google searching for research and data will be key to this step. You’ll be surprised to find how much free research is available online. You may want to interview people about their challenges, and outright ask them if they’d be willing to buy a product ,or service, you have that could resolve their challenges.
Spending WAY too much money, too fast. You’ve heard of the term “bootstrapping,” right? It means spending the least money on your business as possible. You’ll need to direct every penny towards growing your business, not lavish lunches with friends, and new computers, when you can get by with what you have. Spending can increase, and naturally will increase, as your business revenues grow.
Letting an unprofitable business stay in business for too long. If your business doesn’t make money, pull the plug, and stop your losses early. You can take this opportunity to reflect on what went wrong, and develop a new strategy if you think it’s worth it. Typically we would recommend closing up shop after 12 months of negative earnings, but this can definitely vary depending on the industry. Hire a business consultant if you’re not sure whether to stay open or close.