If you are planning on starting a business this year you are undoubtedly full of excitement. While raw excitement, infatuation and determination are all great, you need to make sure that you proceed with caution so as not to encounter the common pitfalls that lead to business failure.
Avoid making these five beginner mistakes many new entrepreneurs often make -- and good luck with your new business venture!
1. Expecting overnight success
Very few businesses are going to go from launch to successful revenue monster overnight. Yes, it happens, but not as often as one might think. The media is always going to talk about a unicorn startup that was conceived on a bar napkin and valued at $100 million two months later, rather than a business that’s been plugging away for the past few years, barely staying above water.
So, go into it knowing that you may potentially need a long time to get your business off the ground. If it happens quickly, that’s a bonus, but it’s better to have realistic expectations and not be disappointed.
2. Sitting back and assuming sales will roll in
It doesn’t matter how great your product or service is -- if nobody knows it exists, your business will die. You have to market your business and put it directly in front of your target audience.
My online marketing company receives a lot of inquiries from startups that all have the same question: “What do we do if we don’t have a marketing budget?” Actually, there are plenty of things that you can do if you are willing to put in the work. A well-thought-out content marketing strategy and media outreach campaign can be executed with little to no marketing budget.
Simply assuming that your target audience will magically discover your brand is foolish -- be prepared to grind hard in the beginning to generate momentum.
3. Failing to perform simple due diligence
Will your business name be infringing on an existing trademark?
Is there a domain name available that will make it easy for potential customers to find your business online?
Is your business name available on all the popular social profiles?
These are just a few examples of basic due diligence that can help you avoid problems down the road. A basic word mark search through the Trademark Electronic Search System (TESS) should be your first step. If it looks like your business name isn’t going to infringe on a mark, see if the domain name is available and then move on to social media profiles.
There are plenty of coupons floating around online that will allow you to register a domain for a dollar, and creating social media profiles won’t cost you a dime. Just be sure to secure your online footprint first.
4. Not going in with a long-term plan
Running a business "on the fly" without a well-thought-out plan is entrepreneurial suicide. On the fly can lead to mismanagement of funds and resources, which will ultimately sink your ship.
While you can’t predict (or prevent) all obstacles you will encounter, setting up some long-term planning will help you avoid inexcusable mistakes. For example, a long-term marketing budget will help ensure that you have funds to cover the marketing, while still leaving enough money to handle operations and payroll.
Imagine that you didn’t have a long-term plan mapped out and instead allocated a large chunk of money to an advertising campaign that didn’t pan out as expected: You'd lack the funds to cover operations and payroll -- and you'd be dead in the water.
5. Not embracing the lifestyle 100 percent.
Being an entrepreneur is perceived as "cool" these days, thanks to mainstream media, the hit TV show Shark Tank (which places business owners on a pedestal) and billion-dollar companies, like Facebook, Uber and Snapchat, dominating the news headlines.
But starting a business requires more than media smarts. It requires that you embrace the lifestyle that comes with the territory. Long hours, constant problem-solving and stress are just a few things to expect, along with:
- Saying goodbye to a major chunk of your free time and sleep
- Limiting time for family and friends
- Putting hobbies and personal interests on pause
- Making your new business the top priority in your life
Are you up to it? Then you have surmounted one of those five big "beginner" mistakes and are on your way.