Those who believe that the main thing in business is to start, and then everything will go by itself, are deeply mistaken. A lot of entrepreneurs are forced to close the business after a short time, as the business did not even bring a minimum income.
It’s not the worst thing when the company simply does not bring the income that you expected. It is much sadder when, due to mistakes made by the entrepreneur at the start, the enterprise simply cannot continue to exist.
Guys from the King Billy Casino AU formulated the most common business mistakes that are inherent in almost any field of activity. To prevent the failure of your business, you need to know your enemy!
The desire to rent a room at the lowest price
Many start-up entrepreneurs think that for the prosperity of the business you must strive to minimize costs as much as possible. It’s a delusion. You need to be able to correctly prioritize and understand where you can save, and where such savings can become fatal.
If renting a more expensive room (for an office or for placing equipment for production) will bring any advantages, then it is definitely worth it.
Hiring your friends and relatives
When you just start your own business, especially if it is the first, it is always difficult to let strangers into your business and immediately start trusting them. In this regard, many make a big mistake – they take their relatives and friends to work in their company, arguing that “I know these people well, trust them, and they will not let you down.”
In some cases, such a strategy may work for you. However, it often happens differently, and after a while you begin to regret that the accountant in your company is your aunt, and the sales manager is a close friend. Firstly, by giving preference to friends and relatives as your employees, you are depriving yourself of the opportunity to hire truly professional people who could bring your business much more benefit.
Secondly, working together with your loved ones is always a potential enemy for your relationship. And when you act as the boss for your relative or friend, then the danger begins to hang over your business. After all, people with whom you have family or friendship are far from always professionals in your business. It’s quite morally difficult to indicate to work errors or even to fire them.
Setting low prices for services or goods
Most often, they do this in pursuit of a larger number of customers and explain as: “I will put a small price on my services or products, and customers will immediately come.” Clients may fall out, however, with this strategy your business risks becoming bankrupt.
When establishing a pricing policy, consider that you will need to pay employees wages, maintain equipment (repair, replacement), pay rent, etc. Assess the value of your product adequately. When you knowingly underestimate it, you show your inexperience.
Refusal of professional services
Do not rejoice if you managed to hire an accountant or lawyer who requested a low salary. As a rule, you are unlikely to wait for professional work from such an employee, and subsequently he will simply “sink” your business. The knowledge and skills possessed by real professionals in their field should be paid accordingly.
Denial of any loans
This is a moot point. We can count many pros and cons regarding this issue. Let’s imagine a situation: one businessman took a loan for a certain amount of money for two years, and immediately invested it in the business. Another businessman decided to independently accumulate the same amount of money for the same two years. As a result, we get what? The first businessman has already started his business and is actively developing it, gaining customers, establishing contacts with partners and suppliers, etc.
And the second businessman will be able to do all this in two years only, and when he enters the market, he will immediately face a serious competitor who has been “in business” for two years already.
Closing an advertising campaign that did not give instant profit
Undoubtedly, it is important to track the results that your advertising campaign has yielded and examine its effectiveness. If it is ineffective, you should switch to another type of advertising or combine several types at once.
Excessive generosity towards employees
Treating your employees fairly – that’s right. But what is justice? If you recruited an employee who already in the first month can’t cope with his duties, what is more fair: to fire him or give him another chance when he has small children at home and a loan for the car?
Unrecognition of own mistakes
Perhaps the biggest and most unforgivable mistake of entrepreneurs is that they do not know how to learn from their own mistakes. As one experienced businessman said, “You have been a student in sports for no more than a year, and in business you have been a student all your life.” You should not assume that if you have reached something in business environment, you already know everything and can do everything. Continuous self improvement and the company’s one is an indispensable condition for a successful businessman.
Author: Serg Dum
Almost 3 years I am devoted to work as a Chief Content Editor at King Billy Casino.