Starting a business is definitely not easy and it comes with a risk, but there are certain key mistakes that every entrepreneur needs to avoid at all costs.
Luckily, there are a lot of great resources regarding this very topic and I made the effort to compile a list of the most crucial mistakes that you should never make.
1#: Don’t Forget To Think About Your USP (Unique Selling Proposition).
Depending on your niche & industry, you most likely have to deal with a good amount of though competitors. The question that you have to ask yourself is:
What sets me apart from my competition?
Your USP will be the answer. Even more so:
If you analyze your competitors before diving into the market, you naturally start placing your business in the environment that it needs to be in order to stand out.
Here is something that you should do:
– Do a research on your competitors. (Before launching your business)
– Create a list and order your competition based on how their presence is similiar to yours.
– Write down the similiarities and differences that you find in comparison with your busines.
Let’s face it:
If your idea turns out to be the exact same copy of others, chances are you are going to have a hard time.
By doing your research, you will not only be able to critically judge your own ideas due to comparison but furthermore, you will get inspiration for new approaches in order to seperate yourself from the crowd.
If you want to know more about how to actually establish a successful USP, I’d suggest reading my guide on “How To Find Your Unique Selling Proposition“.
2#: Don’t start your business without planning your financial needs first.
You might be thinking:
“This is obvious!”.
You’d be surprised though, that almost 50% of all failed businesses, fail because of exactly that:
A lack of proper planning regarding their capital and funds.
It is not too surprising though, as many entrepreneurs don’t even have a business plan when they start their business.
There are several reasons why a business plan is so important:
– You define and know your goals.
– Investors are more likely to fund you.
– You have an overview of the most important aspects of your business
…and last but not least:
You plan your financial needs for capital and funds.
It’s safe to say that a business plan will be one of the most valuable assets, especially in the beginning. As an entrepreneur, it is vital to know all of the key aspects of your business by heart.
How much money do you need for your business? How do you plan to achieve that?
Only if you are able to answer those questions within seconds, you truly understand the importance of planning. After all, you don’t want to underestimate your costs.
Moral of the story?
Plan your business carefully so that you are prepared for potential problems in the future.
You will feel much more organized and confident as well, so if you still don’t have one, what are you waiting for?
3#: Don’t forget to check if your business model is really profitable.
Life as an entrepreneur is exciting! You are your own boss and you can turn your dream into reality. However, we tend to overestimate the potential of our ideas, especially if we are really excited and passionate about them.
What To Do:
Ask yourself if the service or product that you want to sell is really in demand:
Just because you like a specific idea, doesn’t mean that others will, too.
Estimating the demand for a product or service can be tricky sometimes, since we are easily manipulated by our own interests and beliefs.
I would suggest analyzing current trends as a good indicator for demands.
Trying to sell music dvd’s when streaming services are steadily increasing in popularity, might not be the best idea…
This is an obvious example, but with proper analyisis, you will be able to find even more indicators that can highlight success or failure.
Another method that you could try is doing surveys or simply asking your friends.
Don’t know how to create surveys? There are several great (and free) online tools available:
My personal favorite is typeform.
You can make use of their intuitive drag & drop feature to create questions.
Depending on whether you want to use their paid or free services, you can even incorporate images and videos to spice things up.
Furthermore, these surveys are also optimized for mobile phones.
Send them to your friends or colleagues and they will be able to access them at any time.
Surveys are a great way to obtain opinions about a specific topic.
Using surveys to find out if your business idea has potential can be very benefitial if you know how to locate your target customers.
Ask questions about their interests and needs, whether they would be interested in a certain product or not.
If you manage to collect a decent amount of completed surveys, you will gain valuable insight about your potential customers and their desires.
Alternatively, you can always ask your closest friends and family for their opinion on your business idea. Choose the ones that will be brutally honest with you.
After all, you want to make sure that your launch is going to be successful.
4#: If you are working in a team, don’t forget to delegate them accordingly.
This topic only applies to you if you are working in a team but it’s benefitial anyway.
As a business owner, you will not only need to know how to delegate people, but furthermore how to use their unique skills to maximize their potential.
Look at it this way:
Just because you have a team of 5 people, doesn’t automatically mean that they are assigned to the most suitable tasks.
As a business owner, it is your responsiblity to make sure that the job gets done. Period.
Get the right people to work with you and assign them to tasks they manage to finish.
Communication is key in this regard. Talk to your team as much as possible and know their strengths to use their work force to the company’s best advantage.
Did you know?
You can use a SWOT Analysis to determine your own personal strengths, weaknesses, opportunites and treats.
As an entrepreneur you most likely heard of the SWOT Analysis anyway, so why not apply it to your personal skills as well?
5#: Remember to fail in order to succeed.
Now we get philosophical:
You probably heard of the following quote before:
“The master has failed more times than the beginner has even tried.”
It is true: There is no way to be successful without failure.
No matter how much you prepare yourself for a specific situation, you can’t influence chance.
There will always be factors that we can’t control but that doesn’t mean that just because we encounter difficulties, we shouldn’t pursue entrepreneurship of course.
It’s important to keep this in mind. Don’t put too much pressure on yourself or you will miss out on great opportunities but also don’t risk everything.
Prepare yourself and your business as best as possible and understand that you have a great chance of success if you stay aware of your surroundings, even if things don’t always go according to a plan.