Running a business can be risky. You become the person that wears all the hats of every trade, in other words, you have to know anything about everything. From sales, marketing, development, customer service, HR, and oh yes the dreaded finance/accounting— just to keep your business’ afloat and growing. Learn from other’s mistakes when it comes to business and it will avoid you setbacks to your business.
Procrastinating on Tasks
Business owners don’t answer to anyone— because well, they own the company, they are at the top of the corporate ladder. You can mistake “being busy” as “being productive”, this can cost you both financially and drain you of your energy.
Exclusively Focusing on Sales and Profit
People tend to focus too much on sales and profit margins, but not enough on cash flows. If a business does not have enough cash to support it’s operations, it is said to be “actual insolvent”, and a likely candidate for bankruptcy should the insolvency continue. Of course sales and profits are a way to measure success, but it doesn’t matter when your business doesn’t have the money to invest and create revenue.
Not Balancing Quality and Growth
Many new business owners have a hard time balancing their company’s growth with the quality of product they are providing. This is something the business owner must work on, so that they don’t obsess on too many details, but at the same time give the customer high quality work. Not knowing how to balance quality and growth can hurt your company’s brand and long term success.
Overly Focused on the GOAL
Pragmatism is a favorite topic of mine, one that every business owner should possess. Overly optimistic behavior throughout small organizations can be traced to a disproportionate amount of focus on the GOAL rather than the rigor of WORK (execution) required to successfully meet the goal. The business of business is difficult, immerse yourself in pragmatism and continue to execute at the operational level, you will be pleasantly surprised how small business will reach goals without focusing on the goals.
Not Having a Niche
Most likely there is another business out there just like yours; marketing yours in a specific field will set you apart. Staying focused on one thing and doing it better than others, will gain you more customers than the other companies doing multiple things.
Not Hiring a Professional to Handle Taxes
New and small business owners often believe they can do their own taxes on an at-home software based tax preparation program. In reality, not hiring a professional to do your taxes can later cost you more than what you originally owed. Hiring someone to do your business taxes applies to the right tactics to running a business. At a minimum you should have a qualified CPA who can handle the complicated returns and provide guidance on the monthly and/or quarterly tax requirements.
Have other “TOP 6” mistakes that can happen while running a business? Let’s hear it in the comments.