Learn what small business experts say are the 20 biggest mistakes that startups make.
Starting a business is not as easy as may sound. In this article, We will reveal the 12 common mistakes to avoid when starting a new business in 2021.
So how do you successfully launch and run your startup?
1. Make a business plan
A lot of business owners are starting a business without making a plan for the business, Just like the saying, He who fails to plan, plans to fail. A business should state out a business plan, even if it is just one page. It should include how much it costs to operate the business, how much they anticipate selling, who would buy their product, and why.
2. Get organized
Success is inevitable for a well-organized business/startup. Being organized is key. Running a small business is like playing a game. It’s normal to have dozens of things happening at once. So, I have a daily task list, things that I need to do. And I list them by their priority. It sounds simple, but it works and makes me far more productive.
3. Understand your target audience
One of the biggest mistakes you can make when starting a business is when you don’t know who you’re selling to and the right customers. It’s important to recognize that building a great product often doesn’t translate into a successful business. Many companies find themselves focusing on a market that’s simply too small to build a big business in.
4. Plan for success
Every entrepreneur dreams big dreams but sometimes things go wrong. To be successful, a new business needs to remain flexible in its processes and develop easy-to-understand adventure plans in case the idea isn’t as big of a hit as expected.
5. Don’t try to do everything yourself
Starting a business needs a lot of teamwork. A big mistake that entrepreneurs make is thinking they are all alone, and they try to operate independently without surrounding themselves with a team. Don’t try to run a new business by yourself. Find and onboard honest experienced advisors to discuss your business plans, strategy, challenges, and progress. Wisdom and power exist in the multiplicity of a team. Incentivize four to six people to join your company as advisors to receive continuous feedback so that some errors will happen.
6. Launch Now
You don’t have to wait until you have millions of naira before launching a business, it might be too late, start with what you have now, and where you are, with time everything will be in place. If you put in enough effort and motivation, the business will expand gradually. There are lots of mega-successful businesses, from General Electric to Netflix to Microsoft, that started in a downturn. Entrepreneurs are about innovation and resiliency and seizing opportunity by the reins.
7. Don’t hire the wrong people
Don’t just hire people because you need a team/staff. Different skill sets and backgrounds are needed for the different positions you’ll want to fill. When you get started, hire people who will contribute to the growth of your business. When you begin to grow, look at hiring those who are specialized for the roles that need a specialist. Don’t hire a generalist when you need someone specialized, and don’t hire a specialist when you could hire a generalist to do it.
8. Working with friends instead of business partners
For instance, Tom and Jerry are good friends, but they need to handle the business seriously. Jerry has a day’s work, so Tom needs to ask some hard questions: Is Jerry going to keep his day job? Does he expect an equal share of the business share? More on that below. To be successful, business partners cannot be afraid of hurt feelings.
9. Don’t partner with the wrong investors
A very important thing that entrepreneurs should know before starting a new business is that their investors are more than just financial backers. These individuals place their confidence in the business’s potential without having a proof of concept presented to them. Once your business has undergone its seed funding, then they’ll interact with investors who look at the business’s growth and sustainability.
10. Don’t undervalue your product or service
Know the worth of your product or service. Don’t price too low but Don’t price too high. A lot of businesses price their product or service too low just to gain market share. If you are good, price like it! Many entrepreneurs start with the best of intentions and give things away for free, or do free things for charity, community, or visibility. Be very careful and smart with this, because you don’t want to be known as a source of freebies. Pull the cash register first.
11. Starting a business without a registration
Business entity processes are different in most states, securing a business license or registration is required to operate a business, but this process is different from incorporating or organizing a company. Unless you register for limited liability corporation, or LCC, protection, the partners in the business can be held liable for anything bad that happens with relation to the business.
For instance, Tom and Jerry, two longtime friends, have been speaking about their love of cheese. To secure the right type of cheese and due to scheduling conflicts, Tom and Jerry decide to start buying cheese from the farmers and distributing it to grocery stores 💡.
This means that if someone bought food poisoning from the cheese Tom and Jerry sell, that sick person could sue for damages and come after Tom and Jerry’s assets, which they might think have nothing to do with their business. LLCs are, in almost all states, the most common form of registered entity due to their low cost and ease of operation.
12. Inadequate capitalization (Fund)
Starting a successful business needs a lot of capital, also known as “money,”. Capital is what partners, shareholders, or business members contribute in exchange for ownership in the business. Some businesses are capital intensive. Lack of money is the number one cause of business failure.
Whatever the level of your business success, we believe in growth. As a result, our web designers are keen on creating platforms that help businesses reach higher. We are the Software Engineering and Digital Marketing expert in Lagos, Nigeria that will put your business success first.
We are Netwalkers NG, a Lagos based web or app development and digital marketing agency. we provide intelligent business solutions to successfully take your business online profitably for less
What are we waiting for? Let’s get started.