Statistics show that about half of all small businesses fail within the first four years. With that in mind, many entrepreneurs have doubts about starting up their own businesses. Most of these failures that occur within the first year are a result of not practicing smart business habits. If you’re honestly considering starting up a business, it’s important to identify the habits of failure in order to increase your own chances for success.
The first bad habit many people fall into is procrastination. It gets easy to put things off to the side, with plans of doing them tomorrow and once tomorrow comes, you still never get around to it. When you own a small business, paperwork and other tasks that may seem easy will eventually pile up on you if you keep putting them off. Start to think of your paperwork like a credit card-when you charge something pay it off right away. Otherwise you’ll end up with a pile of debt that you have to sort through. No one likes to feel overwhelmed by work so the key is to do what needs to be done in a timely matter to prevent being overloaded.
Another mistake small business owners tend to make is ignoring the competition. Nowadays customers go where they can find the best products and services. Probably even more importantly is finding a good price. I know there are a lot of major businesses such as Wal-Mart and Target that offer low prices which many people flock to and sometimes it can be hard to compete with these companies. However, not all small businesses try to form long term business relationships with their customers. Perhaps they assume that they might as well not bother since there is stiff competition around. But if you honestly felt this way, you wouldn’t have bothered to start up your business in the first place so make sure you think positive. Don’t ignore your customers’ needs. It might be a good idea to have suggestion and comment cards so customers can give you some feedback on what you could improve on. Once you attract your customers, you’re going to have to work hard to keep them. Customer service should be one of your top priorities. If you don’t have good customer service, your customers will find someone who will.
Effective marketing is crucial to any business. There are few products that will sell themselves which means you need to sell them yourself. By this I mean it’s important that you market your products in a way that generates business and sales. If you’re unable to do this yourself then you need to hire an experienced person to do your companies marketing for you. It’s a smart investment since marketing is what keeps your products selling which keeps money flowing into your business. You also want to be careful what kind of employees you hire. Only hire workers who are necessary to your business. While it may be a nice gesture to give friends and family members a job, if they aren’t carrying out their necessary tasks it may not be in your best interest to keep them employed. With all employees that you hire, make sure they are well trained and able to complete the tasks that they’re expected to. Also, be sure to create a happy and comfortable work environment and let your employees know that they’re appreciated. As a business owner, you should know how to adapt to perform any of the tasks that you’ve hired help to do. You never know if you’ll have to take over for some reason like having to let an employee go. Be skilled in accounting, marketing, hiring, and other tasks that may seem basic but play a vital role nonetheless. Even if you’re not performing these tasks on a daily basis, you should know how to do so.
Cash flow problems are not uncommon to small business owners. As an entrepreneur, you need be able to track the money flowing in and out of your business. Your venture may seem profitable but it’s still possible for it to run out of cash. Keep in mind that you have to pay bills, possible loans you borrowed and employees. Be sure to learn how to project cash flow so you’ll know how much money you can afford to spend. Not all businesses skyrocket off the ground. This is especially true for small businesses which can take some time to start turning a profit. Spend wisely and stay on top of impending financial trouble.
One thing that can lead to a lack of customers and financial trouble is a poor location. The best of businesses will end up going under if they’re in the wrong place. When searching for a location for your business, there are some important factors to consider. While price is obviously one of the major ones, there are some other ones that can be just as important such as traffic and convenience. Keep in mind how many potential customers will pass your business during your business hours. You’ll also want to think about if the location will be convenient for your customers or if they’ll have to go out of their way to get there.
Last but not least, you want to keep an optimistic attitude about starting and running your business. Everyone who goes into business has some questions and concerns. Be sure to get advice and have mentors who can point you in the right direction before you make and serious financial commitments. Weigh your options and be careful when making your decisions. There are many books and magazines about small businesses as well as seminars you can go attend to obtain information. Be sure to plan adequately and realistically. Be precise with your business goals and deadlines. Make sure you write down the steps you can take to meet your goals on time and set deadlines for completing those steps. Be sure to stay on track and stay focused on meeting your objectives. Be smart and be encouraged and hopefully your business will be one that stays afloat.
