Many people feel that success in business is about hitting on the right idea and riding it to the moon. While the offerings of your business are, of course, very important, it can also be critical that a novice entrepreneur keep another key focus in mind — avoiding mistakes. Mistakes can be costly in the world of business and there are some common ones that I’ve seen sink entire companies before they could get off the ground. To aid my readers in this area, I’ve listed some of the most common mistakes I see in business and what you can do to help avoid them.
Use Funds Effectively
There’s an adage in business that’s become somewhat of a cliche — “you have to spend money to make money.” The thing about cliches, however, is that they become well-worn because they’re often true. That’s certainly the case here. No matter how many times you may have heard it, it still bears repeating. Money is a resource you use when starting your own business to help the endeavor flourish and grow. If you’re not willing to spend money, paying for business needs with your own time instead, you may be unnecessarily hampering growth during a period in which your business needs all the help it can get.
Now, that said, I’m not advocating for a novice entrepreneur to throw caution to the wind and spend money in an undirected fashion. Far from it. Instead, I’m asking you to consider your money as a key resource that can promote growth when it’s properly allocated. This can include the purchase of important business tools, the gathering of data-driven insights, or even the hiring of new employees. When you treat your money like a resource that can be used to improve the business, you may start to see new avenues for growth open up that may have never seemed possible.
It also should be said, however, that it’s certainly possible to spend too much money in this manner. Overspending can be just as damaging as underspending when it comes to a new business. So, make sure you’re budgeting appropriately and making good use of the money you do spend.
You Don’t Have to Go It Alone
Speaking of hiring employees, let’s talk a bit about the lone wolf mindset that’s become common amongst entrepreneurs these days. We often have a picture of the entrepreneur, sitting alone in their garage, innovating some new product that will take the world by storm. While these types of “garage entrepreneurs” do pop up from time to time, many of the world’s most successful business leaders are people who have learned the strength that comes from being a part of a group.
I reference this here because it still amazes me how much we’ve come to stigmatize group efforts in the entrepreneurial community. Far from being a weakness, the ability to draw on the abilities of a group of diverse individuals can be the make or break feature that defines success. I’ve yet to meet the person who possesses all the many skills needed to operate a large-scale successful business on their own. Instead, I find over and over again that businesses thrive when a team of talented individuals can come together for a common goal. To capitalize on the power of this phenomenon for yourself, seek to add talented individuals to your team early and work with them to bring your vision to life.
Emphasize Your Customers
Another common misconception about entrepreneurialism is that it’s all about the product. If only I had a dollar for every person who’s come to me with an idea for some wonder product that they’ve sworn would make them rich. The reality is that this mindset is misguided for one key reason — it puts the focus on the product instead of on the people for whom that product can solve a problem.
The sooner an entrepreneur can internalize this shift in focus, the sooner they can start to put themself in a position to truly succeed. That’s because, in essence, the world of business is about customers. The product is just a means to an end. Plenty of companies have weathered economic storms or shifts in market tendencies by ditching their core product and pivoting to a new offering. Those companies understood that, at the end of the day, their job first and foremost is to solve problems for the customers. If a product becomes outdated or no longer solves that problem, they pivot to a new product that can solve problems even better.
So, the takeaway here is not to fall in love with your products. Sure, develop them, be proud of them, and promote them as a means for solving problems, however, always keep in mind that your task above all else is to serve customers. If you can keep that as your main point of focus, you’ll be much better set up for success.
Watch Your Competition
Businesses don’t operate in a vacuum, instead, they’re part of a dynamic environment that incorporates market forces, customers, and competitors. That last element bears some special attention because how a business stacks up against its competitors can be a key part of determining its eventual success. That can be troubling for the novice entrepreneur since many are more focused on their own offerings than they are on the offerings of others.
While it’s certainly important to remain focused on your own work, it can be critical to keep an eye on the competition as well. Looking to the manner in which your competition is shifting can provide insights into how you may need to adapt as well. If a competitor is creating a new product, you may need to have an answer. If a competitor is attracting a higher percentage of the market, you may need to react. Though your own work remains a focus throughout all of this, a business owner may be remiss if they don’t adapt to what the competition is doing.
While it’s certainly tempting to think that the world of business is all about hitting on the right idea, that rarely tends to be the case. Instead, the work of a successful entrepreneur often stretches across a number of disciplines and best practices. My hope is that the above look at some common mistakes that often derail business owners can serve as a roadmap that can ultimately help lead to business success. Just keep in mind — if you’re able to avoid most or all of these mistakes, you’re already setting up your entrepreneurial career for an auspicious start.