The Most Common Mistakes First Time Entrepreneurs Make
As an entrepreneur myself, I know all too well the common pitfalls that us business owners fall into - even if you're not a first time entrepreneur. As I'm asked this question a lot from fashion and interior designers branching out on their own, I thought it might make a great post! So, here's a little article to highlight the mistakes that entrepreneurs make, so you can avoid them.
Yes, you have a passion for something – a fashion line, a product, a new way of thinking, something that no one has done before. But that doesn’t mean that you know everything. I'm a huge believer in "knowledge is power", and I also believe that you can always learn. Accepting that you still have a lot to learn as an entrepreneur is a liberating step. Learn to open your ears. Do your research. Be grateful for advice you receive. You may not take it, but at least you're aware of it - and that's a powerful thing.
This same principle applies for market research. Who will buy from you? Just because you would, doesn't mean anyone else would. Ask your target market their thoughts - and don't hear what you want to hear. Really listen.
Whether someone has offered help or you are too proud to ask for it, refusing to get help is one of the biggest mistakes that you can make when you are a first-time entrepreneur. Not only will you miss out on support, but you may even lose potentially valuable networking connections.
I remember when I first started, I was so frightened that asking my friends and family to help would irritate them, that I didn't even ask them to like Offset Warehouse's Facebook page! Looking back, the number of friends with contacts in the exact market that I was attracting, I wish I'd thrown a huge Offset Warehouse bring-your-friends launch party!
Expect And Inspect
A wise person once said, "You should never just expect, but always inspect". That means that you can’t just assume that things are always going to go your way – you need to be inspecting every step to ensure that things happen the way you want them to. I always find that as soon as you don't explicitly say what you expect, it will inevitably be done in the wrong way, and let you and your brand down.
Your unique branding is crucial to your success, and if you aren’t putting in the effort to ensure that your brand is clear and reaching your targeted customers, then there is little point in continuing on and making the fabulous designs.
Save, save, save!
Money makes the world go round, so if you run out of it, then you are going to struggle to continue to make your business a success. First-time entrepreneurs should be careful about how you spend your money - particularly at the beginning. Make sure that you are spending it on essentials, not just things that you want.
Here are some good tips for cutting those costs:
- Don’t employ staff right off the bat. It will be tough, as you soon discover that you need to be your own customer support, salesperson and accountant, but you just might have to do everything yourself for a little bit until you have the funds to secure another person's livelihood. You don't want it to be your fault if they are out of pocket, or suddenly having to terminate their contract.
- What about working from home until you are off the ground? They say the best ideas start at the kitchen table! Particularly in this day and age, rent for offices or studio spaces are so high, if you can avoid that outgoing cost you'll save a huge sum of money for other things. Or if that's not an option look into hot desking or something similar where you pay per hour you use a desk, or only use a space for meetings.
Investors vs. Customers
What comes first, the investor or the customer? Some entrepreneurs think that the investor comes first. Yes, investment could give you a huge push in the right direction, but it's your customers that will be the ultimate deciders of your success. Customers should always be your number one priority. If you have no customers, you have no need for investors. So before you get wrapped up in investor paperwork and start pushing your customer to the side - set aside time to speak to your customers every day.
Also, often investors want to see track record before risking any of their hard earned cash on you. And whats the best way to prove you're a sure thing? Getting that list of customers together!
Keep To The Plan
Remember the plan! Every first-time entrepreneur starts off with a business plan, but it is all too easy to ignore it and wander off the path because it feels like a good idea: and it never is. Make sure that your business plan is a good one, and you’ll never need to leave it for very long. I find that revisiting your plan every year is a great way to see that you're achieving your goals. We often get wrapped up in the minutiae of day to day business - don't forget the big picture. Have a couple of big goals set out for your business that you're looking to hit this year.
Too Much Too Soon
When you start a business, sometimes you have more than one idea. Or you might panic and think "I need to add more revenue streams, or I won't make enough money". Don't. Don't throw all your eggs into the basket at once. It will be too much to handle and you'll soon find it difficult to make just one of them flourish, let alone all of the others. Business is about growth, so keep your ideas focussed. Of course, have all of these great ideas in your business plan, but remember you're in this for the long haul. Introduce new ideas once the first ones are well established. You can always grow and improve - you don't want to have to scale back.
Turn Criticism To Your Advantage
It can be very difficult to take criticism constructively - we're human! It may be that someone doesn't want to invest in your idea, or doesn't like your product, or has a list of ways to improve. Try not to retaliate negatively. Remember that one person's opinion doesn't mean that it isn't worth carrying on with. It certainly doesn't mean they don't like you personally. Say thank you and keep their details - you never know when they might come in handy (or when you can get in touch to prove them wrong!)
Whatever you feel, use their words positively. You might decide that, after an initial shock, they have a point! If it's purely negative and you don't agree with the opinion, then use it to fuel your passion: keep working and come back even stronger. Develop a thick skin and remember starting a business isn't a popularity contest.
Evaluate (& Celebrate!)
This in my opinion is the number one biggest mistakes that a first-time entrepreneur can make. Evaluating may seem a little bit boring, but it is the best way to see how well you are doing, what you could be doing differently, and how you can continue to drive your success forward. Without evaluating, how will you know if you are successful?
As you can see, all of these mistakes are very easy to slip into, and you may have just realised that one or two of them feel a little familiar. Remember, it is simple to change that, as long as you are continuing to evaluate your progress throughout your venture. Think I’ve missed anything? Let me know what you think is the biggest mistake in the comments below!
If you like these articles, then please do sign up to our monthly newsletter, where I round up all the latest posts. You can tweet the article using the tweet buttons throughout the article and below.