It is foolhardy to expect a smooth ride in the course of running your business. Both new and established entrepreneurs end up making business mistakes that cost their profitability. The important thing is not whether you make mistakes but if you can learn from them. You can then take remedial action to bring your business back on the right track.
Here are the top business mistakes you might be making:
Failure to Hire the Right Skills
As an owner, it is unlikely that you can perform all the functions in your business. You might be a good marketer but a poor accountant. Insisting on doing everything may result in you poorly performing your core functions. So, don’t wait too long before hiring people with the right skills. If you need an accountant, hire one. To improve the reach of your products in the market, you need a professional marketer on your team. Make sure you fill in the holes as your business grows.
Staying In a Bad Location
Unless you have an online business, choosing the right location remains a key determinant of success. If you insist on staying in the wrong location, you may end up missing important opportunities. Ideally, a business should be located near the suppliers and customers. That way, it will be easier for you to manage the supply chain. You will receive your inputs more cheaply and take your products to the market at a lower cost. It will also be easy to get qualified personnel in that particular location.
Pricing Products and Services Too Low
Lack of confidence in your abilities may result in you undervaluing your products or services. That not only diminishes your revenues but it also undermines the value you have as an individual. When customers see your low prices, they think you have substandard products. In reality, that could be far from the truth. So, how do you set the right prices for your products? Start by thoroughly exploring the market to determine optimal prices at which you should sell your products. You will improve your revenues as well as your profits.
Entering Agreements by Word Of Mouth
Before you enter into a contract with anyone – partners, suppliers, customers – carry out due diligence. Make sure you iron out all the details that might make or break the contract. Also, avoid entering contracts by word of mouth. A good contract is that which is written with all the terms and conditions spelled out. Before signing the dotted line, you need to be sure about the details of the contract. Failure to do so will result in unnecessary disagreements and lawsuits. Make sure you sign all of your contracts in the presence of an attorney. If anything goes wrong, you will have the legal backing you require.
Neglecting the Accounting Function
Small businesses might be contented with nothing more than bookkeeping. While that may lead to the recording of basic business records, it may not capture all the information you need to make decisions. So, don’t leave all your record-keeping to your bookkeeper. Make sure you know the basic concepts of accounting to monitor what’s going on in your business. Leaving a bookkeeper unsupervised is a recipe for cash flow issues, embezzlement, and so on. If your cashflow isin’t improving and you believe you need some help streamlining your finances, then you might consider outsourcing cfo services. These professionals will give you a better picture of today and tomorrow – from strategy to culture to your company’s accounting operations.
Failure Take Advice
Most entrepreneurs are so single-minded that they wouldn’t take advice from anyone. Anyone who suggests an idea contrary to their beliefs is quickly branded a naysayer. Such entrepreneurs seem to know it all. They hardly consider other people’s advice useful for their businesses. So, they never ask for expert advice. To succeed in business, you should be ready to take constructive criticism. Listen to everyone who comes to you with genuine advice. Have mentors you can look up to. Take advice from your customers, investors, and lenders. However, learn to block out all negative comments.
Avoiding the Use of Technology
One of the ways to quickly scale up your business is to use technology. Yet, some businesses mistakenly view technology as an unnecessary burden. In today’s world, it is difficult to succeed in business without basics such as a website. Technology can help you save money when it comes to marketing your products. You don’t have to understand technology to use it. You may hire the right employees or outsource from specialized technology businesses. Failure to adapt technology may hurt your business now and in the long-run.
Now you know some of the business mistakes you might be making. You should take measures to avoid these mistakes to grow your business. Be prepared to do the right thing every day without faltering. With discipline and dedication, your business will succeed.