There’s this saying that goes: “Mistakes have the power to turn you into something better than you were before.” But there are mistakes you should absolutely avoid when starting a new business; otherwise, you’d end up full of regrets. It’s great that you’re thinking of being entrepreneurial; however, you need to know that there’s certainly more to starting a business.
Here are seven mistakes you cannot afford to make when starting a new business.
1. Not owning a business account
As opposed to using a personal account for your business, a business account makes it easier for you to track your business’ expenditures and sales, helps in auditing and filing tax returns. You may not know this but having a business account announces your professionalism to your customers. Check reviewsbird.co.uk for reviews and experiences on how to start your business account.
2. Not having a plan for your business
Now, this is very important. It would be best to sit, think and create a business plan; otherwise, your business will fall like a pack of cards before your eyes. It would help if you had a business plan, design a plan for your finances to identify and reach your target audience, differentiate your business from other competitive businesses, and create a niche for yourself.
3. Underestimating yourself
You should be confident in yourself and the services you’re rendering. Devaluating your self-worth would cause you to undervalue your products and services, leading to loss or very little profit. This, in turn, can cause you to close down your business. Be positive and have confidence in yourself!
4. Not knowing your spending limits.
The idea of any business is to make money and create a comfortable life for yourself. Spending so much of your earnings on things that do not matter will gradually drain your savings. Drained savings equals little or no investment. Little investments will cause your business not to grow. This also applies to under-spending; not investing anything in your business certainly will lead to little advancement in your business.
5. Hiring too soon
You’re just starting a business. You should not make the mistake of hiring immediately. You can study the market for a while before employing people to work for you full time. This will help you strategically plan your income and influence how much you want to pay your future employers. If the workload is too much for the first few months, you can decide to hire part-time workers till you are sure you really need a full-time employee.
6. Treating your employees badly
When you eventually start employing, you should treat your employees well. In the words of Stephen R. Covey, “Always treat your employees exactly as you want them to treat your best customers.” Maltreating them will affect their self-esteem, and they’ll ultimately not give in their all to make your business prosper. You should give respect and recognition to your employees.
7. Not paying yourself
It may be hard to determine the particular amount you should pay yourself. Paying yourself a percentage of the profit you make works well in ensuring you don’t get paid too little or too much.
Pay attention to the above points and your business will be one of great reputation!