Posted: Wed 3rd May 2023
Many people dream of having their own business. Being their own boss, turning a passion into profit or having more time to enjoy other activities are some of the reasons that people set up businesses.
But what happened to that dream?
Being a business owner is hard. Really hard.
You need to be able to deal with uncertainty, limited resources and a lack of time and learn by doing. And yes, money, or the lack of it…
There are many reasons why small business fail, but there are also a number of avoidable mistakes that most business owners make. These mistakes make your life more difficult without you even realising it.
1. Not having a vision
A business without a clear vision is like a river without banks – it stagnates and goes nowhere. Without a vision, your business can't develop a coherent strategy that leads toward the desired result. You can't identify milestones (short-term plans) against long-term goals.
It's vital to have a clear vision of where your company is going and to share it with your team (if you have one), so that they see your vision as clearly as you do.
2. Not knowing who your customer is
There's a reason why there are so many articles about this. A key element in growing your business is to know exactly who your customers are.
To communicate easily with them, you need to know:
where they are
what problem they have and don't want
how and where they consume information
what puts them off
Knowing your customers will not only help you to improve customer acquisition and loyalty but will also increase your sales.
3. Not staying true to your core
First of all, you need to clearly figure out your business's core. It's a combination of what you're great at doing and what you're absolutely passionate about.
Your job as the leader in your organisation is to make sure that every system, person and process in your business is designed and aligned to drive that core focus with absolute consistency.
If you and/or your team get distracted by the new 'shiny stuff', it could inevitably pull you away from your core, diluting focus and creating chaos and complexity.
4. Not knowing your numbers
When starting your business, your main goal is to secure as many customers as possible to keep sales coming. But after a while, many business owners are surprised to learn that you can bring in a lot of money without actually turning a profit.
Knowing the numbers behind your business is essential. It can help you make informed decisions that have the potential to make a big impact on your business, your growth and your bottom line.
Numbers and data don't lie, but you need to pick the right ones for you and check them frequently. So make sure you:
Review your financials every month
Manage a monthly expense budget
Identify and track the most critical numbers for your business every week – for example:
5. Hiring the wrong people
When you hire, always think long term. Don't hire to solve a short-term problem. A good network of contractors or freelancers can help you on the short term.
When hiring anyone, you must make sure they share your company's core values. If you haven't defined those values yet, use your personal values as a guide.
Hire slowly. If, unfortunately, you hire the wrong person, you have to be willing to fire quickly.
6. Not defining roles and responsibilities
"We're a small business, so we all do everything." This is a typical answer business owners give when asked about roles and responsibilities.
To avoid people tripping over each other and creating chaos, each one of your people – including yourself – must know exactly what they're accountable for.
That means having a coherent organisation chart in place (even if you only have one employee) and job descriptions.
You must make it abundantly clear to your employees exactly what you expect of them and how you'll measure it. They need to be able to identify their contributions as well as their progress.
7. Not identifying your core processes
Process is the actions your business takes to perform a specific function. Having processes in place will allow your business to thrive without you, as well as making sure your customers receive the same high-quality customer service every time.
It will simplify onboarding new employees and reducing costs. With good processes, you and your business will not depend on specific skills to deliver your product or service.
8. Not asking for help
Entrepreneurs are generally ambitious, independent and optimistic people. While this is advantageous most of the time, sometimes these characteristics hold small business owners back when problems arise. They don't always want to ask for help, even when they need it.
Beyond your immediate need to solve a particular problem, listening to how other people approach their businesses can flick on a switch in your own thinking. This added perspective could eventually lead to new opportunities.
As human beings, we know that we need help – but we're often afraid to ask for it. It's typically rooted in pride, a fear of losing control, or some combination of the two.
Remember, asking for help isn't a weakness, but rather a strength. As a business owner, the success you experience may be directly tied to your willingness to ask questions and admit when you don't have all the answers.