Your small business is like an extension of yourself. You’ve poured in countless hours. You’ve put in all the work. You’ve shed all the blood, sweat and tears. All the research and hard work have led to this moment.
To start, you should be quite proud of yourself for going through all the steps. It’s not an easy process and you should be patting yourself on the back. After all this though, the worst thing would be for your business to fail.
After all, 20% of businesses don’t make it out of the first year and 50% don’t make it five years. The reasons for failure are many: lack of cash flow, not the right team, mismanaging assets and so on.
So, how can you avoid those mistakes that lead to the end of your business? Besides hitting the lottery or having every customer that walks into your store buy something, chances are you may run into one of those issues sometime. Ups and downs are inevitable But by taking the steps to avoid the big mistakes, you can keep your doors open and your business profiting.
Neglecting the Internet
Everyone uses the internet for everything. People upload their cat photos, get recipes, get directions and everything in between. That’s also how many people are going to find your business.
Estimates say that around 50% of small businesses don’t even have a website. That’s almost preposterous to think about, but it is a harsh reality. Not having a website can cut many potential customers from even finding your business which means there will be fewer people walking in the door.
Your website doesn’t have to be super fancy, just something with business hours and contact information. Finding the perfect name may be the only difficult part about getting it set up.
This also extends to social media. If you don’t have a social media page, it’s time to stop reading this article and go about making one. Again, it doesn’t have to be anything fancy, but just something that can reach more people. Plus, it’s free marketing. You’ll want to push out regular content, whether that be news about new products or sales, to keep your clients coming back for more.
Not Listening to their Customers
Many years ago, Netflix tried a horrible experiment where they tried to separate their DVD service from their streaming service. CEO Reed Hastings was sitting in his backyard hot tub with a friend, explaining the idea. The friend mentioned that he thought it was a horrible idea and would fail. Hastings, being the CEO, thought his friend was short-sighted and didn’t see the bigger picture.
What happened? Netflix lost almost a million customers from that disaster and ditched the second service. Hastings later said he was overconfident and moved too quickly.
Even though you may not be the CEO of a multi-billion dollar business (yet), you should still be listening to your customer base.
If you’re in a small community, chances are you’re going to be seeing a group of people who will eventually become “the regulars”. These people will be your regular client base, and it’s a great idea to lend an ear to what they have to say.
Be sure and talk to them regularly and ask for feedback. The words of one person may not carry the same weight as a group of people saying similar things. “The customer is always right” applies here and you need to keep your customers happy to keep your business open.
Being Too Casual with Finances
When it comes to the numbers, you need to know them every which way. You don’t want to be caught off guard by a surprise surplus or budget. You’ll want to have them down to the T.
As explained earlier, many small businesses fail because of money issues, whether that be cash flow or mishandling of money. As a small business owner, you probably already know that you may not turn a profit for a few years and you may have to go a while without a salary.
In addition, you’ll need to track exactly how much you’re spending.
You never want to overspend but you also never want to significantly underspend. If you can find a great deal on printers, great. But you don’t want to short change yourself on buying a top end ice machine if you’re in the food business.
Spend money wisely and don’t be afraid to ask for help in doing so!