There are probably very few mistakes you can rattle off that an experienced entrepreneur hasn’t made. Name the mistake and most of us have been there, done that. Screwing something up is probably the best way I’ve learned anything in my entire career. That kind of education is something you just don’t get in graduate school.
Here are the top 10 mistakes – listed in no particular order – new entrepreneurs make.
- No market research.
New entrepreneurs often don’t take the time – or make the effort – to gather information about their target market. In addition, sometimes, new entrepreneurs don’t have a really clear idea of exactly who their target market is. Also, entrepreneurs might learn, when it’s too late, that market conditions require them to create different products and services for different customers. Doing market research can help entrepreneurs avoid these common pitfalls.
- Assuming there are no direct competitors.
Many new entrepreneurs either don’t know who their competitors are, or, they don’t view top brands as competitors because those brands don’t sell the same exact product or service. In addition, many entrepreneurs underestimate their current competitors, thinking current competitors are seriously underperforming and will never be able to step up their game. Entrepreneurs must assume the customer will always have a choice of providers. Never stop competing; the day an entrepreneur stops competing is the day she becomes lazy and complacent.
- Skipping the goal setting phase of business planning.
Dieters don’t start diets without setting a goal; entrepreneurs shouldn’t start a business without setting goals. Entrepreneurs can start with a simple goal like making $ 1000 in profit each month for the first year you are in business. Once that goal is reached, set a new goal.
- Being slow to get your business to market.
The world is full of people with great ideas, but only true entrepreneurs breathe life to those great ideas and turn them into products and services. Exceptional entrepreneurs get those products and services to market quickly. Statistics show that the first to the market can usually dominate the market.
- Spending all your startup funds very quickly.
Many entrepreneurs feel they need to look big in order to impress clients, or to feel like real entrepreneurs. After they get their first round of startup capital from the bank, investors, friends or family, they rent large offices with expensive furniture, hire a receptionist, buy all kinds of expensive office equipment, and the buy all kinds of stuff from smooth talking sales people who call them and make them feel special. When the money’s almost gone, that’s when reality hits and they want marketing professionals, business coaches, lawyers, and other professional service providers to work for damn near free to bail them out. New entrepreneurs should consider shopping at thrift stores for furniture and using as many free or inexpensive web-based services, like Skype for an office phone line and mobile apps for faxing, instead of buying office equipment.
- Doing very little marketing – or no marketing at all.
Everyone is a marketing expert now. Many entrepreneurs do no marketing at all, or what little marketing they do, they do it themselves. Accountants are not marketers – accounting is the thing they do best. Therapists are not marketers – therapy is the thing they do best. Lawyers are not marketers – the law is the thing they do best. A business needs marketing; why would an entrepreneur have someone doing marketing for her business it if it’s not the thing they do best? Never assume friends and family will do so much word of mouth marketing that you’ll make all the money you need to keep your doors open. Hire a marketing person. Websites like Elance.com will help new entrepreneurs find marketing professionals who fit any budget.
- Putting networking low on your priority list.
Even if you are active in the church, your family is 6 generations deep in your community and spouse is the President of every community organization in town, you still need to network. Why? Because when it comes down to where people spend their money, people aren’t loyal just because they know you. Entrepreneurs need to actively network and let people know they are interested in them all the time – not just when they want something. Be involved in the community. Give back. Invest time and resources into the community you want to buy your products and services.
- Doing everything yourself.
Many entrepreneurs get these great ideas in the shower and get so excited that they just jump right in! And they attempt to do it all. Everything. And where does it get them? It gets them broke. Learn what you do best – and do it. I found Elance.com and started hiring freelancers to help me with the rest. Today, my team consist of me, my wife, my son, and several long-term Elance independent contractors I couldn’t live without.
- Hiring the wrong people
Too many new entrepreneurs make the mistake of hiring their cousin Larry or Tyrone. Their cousin doesn’t come to work. Or when he does come to work, he’s late. Or, entrepreneurs hire their children, but their children have the worst customer service skills. Or, entrepreneurs may run an ad in the paper for a Marketing Manager, but have no idea what kind of skills a Marketing Manager should have. This is an easy fix: search those LinkedIn groups! Hundreds of LinkedIn groups out there will help you figure out exactly the type of person you are looking for. Just post your question in a Marketing LinkedIn group and wait for the responses to pour in.
- Forgetting all about the customer.
You created a product or service, but did you remember to check with the customer periodically to make sure that product or service is meeting the customer’s needs? Often times, customers won’t complain if they’re unhappy; they just stop using your service. Checking in with your customer and asking if there is something you can do to improve the customer experience is a good way to get feedback. It’s also a good way to get ideas about new products and services.
Mistakes are common. Every entrepreneur makes mistakes. If an entrepreneur learns from mistakes, she can build a successful business and see tremendous growth, year after year.
This article was repurposed from a conference session presented by the author at the Woman Up! Conference.Business & Finance Articles on Business 2 Community