Today we’re going to be starting a new feature on the EnMart EmbroideryTalk Blog. Some of our readers have been saying that it would be helpful to have a reference for ideas or tips about starting a small business and making it grow. Given that information, we’ve decided that Wednesday should be Business Tips day. The plan is that, every Wednesday, if possible, we will write a post on some aspect of starting, building or managing a business. If you have any questions you would like answered, or suggestions for a post topic, please let us know.
The first Business Tips post will cover a subject that no one likes to think about, but which many small businesses face, failure. Depending on where you look, you can find statistics that claim that 90% of small businesses fail in the first five years. Some articles or web sites will tell you that starting a small business is an extremely risky venture and, at times, those articles or sites would be right. Many small business owners fall victim to common mistakes which end up causing their businesses to fail. Avoiding those mistakes can help make sure your business succeeds when others are failing.
Mistake #1: Poor Money Management: A lot of business owners think only about the freedom of owning their own business, they don’t consider they will also be responsible for making sure the business is profitable. Make sure to keep careful records of all money that comes in and all money that goes out. Have an emergency fund that can keep your business going should you have a few lean months. Make sure you have a qualified accountant who can review your record keeping and tax forms.
Mistake #2: Growing Too Fast: The big company down the street wants a huge order so you hire two more people. Your best friend says you would make more sales if you had a storefront, so you rent space in a local mall. Wanting to grow your business is a great thing, but you need to have a considered, measured plan for doing so. Make sure you have realistic goals and that you are structuring your business around real world needs and not around your dreams for what your business could be.
Mistake # 3: If I Build It, They Will Come: Everyone who starts a small business begins with the rock solid belief that there are customers out there for the services they offer. The business owners who prosper are those who actively go out and recruit those customers. If you own a small business, part of your job is sales, whether you feel comfortable with that or not. Just opening a business isn’t enough to get customers to spend money with you. In order to succeed you have to provide great product, superior customer service and, most importantly, you have to keep reminding potential customers you’re out there. Just having a business isn’t enough to convince people to buy from you, it is up to you to provide a compelling reason for them to do so.
Mistake #4: Failing to Learn From Mistakes: Everyone likes to think they will start the only business in the world that will move from success to success. It is a nice fantasy, but the reality is that you will make mistakes along the way. You’ll underbid to get an order which will cost twice what it should have and eat up all your profit. You’ll buy a piece of equipment that turns out to be a lemon. You’ll hire a new employee even though your instincts tell you not to make that hire. Every businessperson makes mistakes, the ones that survive are the ones that learn from the mistakes they’ve made. The trick is to not be afraid to make a mistake, but to realize that mistakes are part of growing and that you will survive them and go on to additional success. If you can master that thought pattern, your small business will be one of those that is likely to succeed.