Everyone makes mistakes at some point in their life and sometimes the negative impact of some of your mistakes can be significantly damaging for both the long term and short term.
The best way to learn from a mistake without making one is to learn from the mistakes of other people and try not to repeat their bad decision making. Here are some examples of the most common mistakes small business owners often make.
Trying To Get Rich Quick
In reality, overnight success in most cases takes several years to achieve. If you are planning to be rich overnight, you are likely to become discouraged early on and give up your dream prematurely. It is important to be aware that success takes time, perseverance, and in many cases plenty of luck. It is important to make sure you give your business the time to grow. Only if your company is stagnant for a long time should you take it as an indication that you need to try something new.
Assuming You Don’t Have Any Major Competition
Even if you have the most up to date and never-been-done-before approach to something, don’t assume that you have no competition. Competition is more than just the direct, obvious competitors. Competition is also all the available alternatives. What else could the consumer do instead of using your product or service? Could they do nothing? The customer almost always has the option of walking away. This on its on is a serious competitive threat.
Not Being A Strong Leader
How successful a company has the potential to become is very much determined by how effective the leadership group is within an organisation. This does not mean you need to be an authoritarian, but you also shouldn’t be everyone’s best friend. A great leader sets the course for the company, communicates it constantly, and inspires the team to get to the next level.
Setting Unrealistic Financial Goals
If all business plans came true, being a billionaire would be nothing extraordinary. Many entrepreneurs go into new ventures planning astronomical returns. Yet most never even get the business off the ground. Unrealistic goals not only hurt your credibility, but can also be an emotional drain. Set specific, measurable, accountable, realistic, and time specific (or SMART) goals to ensure continual progress. If you do this, your dreams of being an overnight success in 15 years are much likely to become a reality.
Reducing Your Prices
In many cases, the first thing entrepreneurs do to when business is tough is to try differentiating on price. Cheaper prices won’t always result in more customers. Most customers are willing to buy more expensive items because of the greater quality or the added convenience. During tough economic times, an increase in price, coupled with improvements in quality or convenience, can drive customers to your door. Price slashing is a dangerous game, which could lead to slashing employees or salaries to keep costs down.
Having A Poor Marketing Strategy That Is Not Consistent
You never know where, when, or how a new prospect is going to hear of your business. If you have a mix of messages out there, the prospects will have an unclear expectation of what your business can offer. Your company must present a consistent, clear message on all fronts. You will never get a second chance to make a first impression. Make sure every new prospect who sees your business for the first time receives the same, consistent message.
Trying To Do It All On Your Own
One of the biggest mistakes entrepreneurs make is to believe they can do it all by themselves. While an entrepreneur can do almost everything, they do almost everything poorly. Just like any other person, an entrepreneur has one or two natural talents. As an entrepreneur, it is your job to identify those talents and focus on them to your fullest. Surround yourself with people who are strong where your talents are weakest. Great companies are built on the foundation of exploiting a few strengths, not on trying to be masters of everything.
Not Being Honest Or Having Integrity
Thanks to social media people can criticise your business or call you out for bad behaviour or terrible customer service. The popularity of the internet means that people have the power to share anything with anyone at any time. If your business tries to cover up a mistake, it is just a matter of time before word leaks and you are labelled a liar. Having this happen is extremely bad for your business. It is much better for you to be the one to break your own bad news, and as a result of this your customers and potential customers will perceive you as being honest and trustworthy.
The team at Vault are here to help. We offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 1300 1 VAULT (1300 182 858).