The world of small business can be tricky and even downright dangerous if you do not know how to navigate it.
Thousands of small business owners have lost millions because their company failed due to costly mistakes. Today we are going to dive deeper into five common mistakes that could destroy your small business before it even has a chance to flourish. So if you are thinking of starting your own company or you are in the process of building one, you will want to pay close attention.
Five Costly Small Business Mistakes
- Not counting costs– When you start a project, even a small one, you are going to need to do the math. Finding out what the project is going to cost before you start is a wise move. Many small business owners jump into a project without planning a budget and end up way over their heads. For each project, no matter how big or how small, sit down and figure out how much it is going to cost and how long it is going to take. This will allow you to avoid any surprises that might have popped up along the way.
- Failing to write a business plan– This is another one of those mistakes, that so many people make and it can be costly. A good solid business plan is like a roadmap, that will guide you along the way. While you might not stick to it 100% of the time, it will be a great way for you to have a direction. On the other hand, not having a business plan can be a recipe for failure because you will have no clue which direction your company is going.
- Growing too fast– While everyone wants their small business to grow, expanding too rapidly can be the downfall of your company. Moving into markets that you have no idea about is not a wise move. Before making any moves, make sure to learn about the market you want to move into and see if it is a right fit for your business. We have all seen large companies that grew too quickly and ended up filing bankruptcy because of it. This can happen to you too if you are not careful.
- Ignoring your competition– No matter how small or large your competitors are, you should never avoid watching them. This is a mistake that a lot of business owners make and it could end in badly. Just imagine if your competitor, who is offering the same product line as you, drops their prices dramatically. If you fail to counter them, you just might see all your sales dry up in a matter of days.
- Failure to utilize social media– This is a new one that many small business owners are missing out on. Many of them have been in business for many years and do not feel the need to interact with their customers on social media. But this is a really big missed opportunity and social media is a great way to bring in new younger customers, that you would have never gotten in your brick-and-mortar location.