Mistakes are something that people always avoid, especially in society, where mistakes always have a negative meaning. So, we usually tend to cover up our mistakes and blame others, doing everything we can to avoid the heavy burden of doing something wrong.
Most people are worried about starting a business because they are worried about making mistakes. But the bottom line: business mistakes don’t stop your momentum, they get you on a better path. One of the best self-confidence-building tricks is to treat mistakes as a learning experience.
And in the world of entrepreneurship, you will make a lot of mistakes. You cannot avoid it. Fortunately, to avoid more than one mistake, you can make an impact on your previous plans. This article will discuss some of the common mistakes in starting a business, and tips for avoiding business failure.
11 Mistakes When Starting a Business To Avoid
All entrepreneurs make mistakes. It doesn’t matter, Whether you’re your first or fifth business mobilization, prevention is key. Here are some common mistakes small business owners make, and how you can avoid them:
#1. Not Writing a Business Plan
Have a business plan?
Please write down what your business plan is, it must always be on track and able to exist in the midst of competition.
Writing a business plan means that your business idea is clear, can be corrected and measured.
Many new entrepreneurs start a business without imagining the big picture. When they start a business, it just feels like that”¦.
The problem of product delivery will be considered in the field later.”¦.
If there is a problem with the product being returned, it will be later when it happens”¦
They have no understanding of markets, finance, type of business, or logistics, and lack the further understanding of being able to use time, money, and energy when things go wrong.
Avoid this common mistake by writing a business plan to help identify what you don’t know and find gaps that need to be filled.
· Do you have to work like a shipping agent? · Or send manually? · How will you process the product? · Who do you sell to?
Every product you make must relate to your business plan.
It keeps you on track to meet your business needs and goals”and build a business that doesn’t fail.
#2. Not Focused on Cash Flow and Profit
One of the financial mistakes that entrepreneurs make is not paying close attention to cash flow and profits.
If you ask experienced entrepreneurs what are the most important skills in business mobilization, they will answer with math.
Many people start their business as a hobby and don’t really pay attention to the numbers they should.
Business math, working together is really simple.
To see how profitable your business is, use this formula:
*Profit = Demand x (Revenue – Expenditure)*
And a lot of costs to be incurred.
According to research, small businesses spend an average of $40,000 in th. first run the business.
This is spent on the following:
Let’s break down the profit formula above.
Assume there are 20,000 people searching for your product online per month.
Suppose your product is better known and able to reach 1/2 of the product seekers, that is 10,000 potential consumers.
The average running sales is between 1% and 2%, that’s 100″200 sales. If your average order value is IDR 1,500,000,- and you have a 30% net profit margin, your profit will range between IDR 4,500,000 and IDR 9,000,000 per month.
Of course, this is just a rough estimate.
But whatever you’re up against, when you’ve counted it out, you understand what you’re getting.
Avoid this common mistake by finding your potential profit and cash flow using the formula above.
Also read, 3 Marketing Processes To Sell Your Products.
#3. Not Evaluating Your Business Idea
One of the biggest mistakes you can make when starting a new business is not doing market research.
You should study the competition and understand how you can differentiate yourself from them.
Competition can come from small SMEs that sell products similar to yours, it can also come from large entrepreneurs Indomaret, Matahari, Lazada etc.
Many novice entrepreneurs enter the business world without considering whether the type of business they are in is appropriate or not.
There is a problem where a product has low demand but is sold by big players.
If this is the case, it’s better not to open a business that competes with big players.
To understand market conditions, you have to do some research.
Find your competitors’ types of merchandise and see:
· Online views · Social engagement · Media coverage · Search engine optimization (SEO) ranking
You also have to evaluate whether selling this product is just a temporary trend? Or can it be done for a long period of time?
With a solid understanding of market conditions, you will have no problem building a business in the right type of business.
#4. Selling Too Many Products
A big mistake new business owners make is selling a really large number of products.
Sometimes, if one product doesn’t sell well, the owner will add more products to their store to attract potential customers.
This is not always useful.
What is your product branding?
If you focus on selling bags, then don’t sell other products that have nothing to do with bags.
Because the brand you sell is a step for people to know and see your business.
#5. Does not seek Organic Visitor Traffic
What is organic visitor traffic?
Organic visitor traffic is, visitor traffic that visits from search engines for free, visitors can visit through articles on blogs, videos on youtube etc.
That is, you really rely on paid ads like FB Ads, Google Adwords to bring visitors to your online store.
Not wrong indeed.
But imagine how much money you can save for advertising promotions, if you can get free visitors from your blog articles or Youtube content?
But I’m selling bags? Do you want to write about all the bags?
You don’t have to, the key here is to do content marketing not by product, but by your customers.
Because bag enthusiasts are not only looking for information about bags through search engines.
A bag enthusiast may also like makeup techniques, healthy food for a good body, companion accessories, lifestyle models, etc.
You know, 70% of search engine visitors come from organic searches on google, and search results that are on page one get 67.6% of clicks from organic search results.
#6. Giving Free Products or Free Quiz
Businesses fail because they really spend a lot of money on free stuff and quizzes.
Some products are suitable to be given a free quiz promotion.
Quizzes with free product prizes are an effective way to market products, but they are not always appropriate for every type of sale.
Free promotions can work on products that are easily damaged or consumable, such as: skin care, food, supplements, and the like.
For all other products “ such as clothing” – this technique is difficult to work, even more so that it will cost you money.
#7.. Not Asking for Help
New entrepreneurs usually think that they can do it all on their own.
In knowledge economics, there is an opportunity cost plan.
Basically, when you choose to pursue one opportunity, then you are no longer free to pursue other opportunities, this is the “price” that must be paid.
So the cost of one opportunity is indeed the “price” for every other opportunity you have.
If you’re bootstrapping your own business, you might as well do it all yourself.
You customize the website, you tinker with it, you upload the products, you write all the product descriptions, you do all the marketing.
It looks great, but remember that there is valuable time that you should be able to spend preparing new ideas, or building business interactions, that will be wasted.
#8. Don’t Know Your Target Market
Before building a business, there are 2 things you should examine:
· Finding product ideas · Knowing who your target market is.
When you understand who your customers are, how they behave, and why they behave the way they do, you will be able to serve them and meet their needs.
#9. Does not have a mature marketing plan
“Failure to make a plan, is planning to fail,” as the saying goes.
When you are impacting your online business, you understand who your customers are and where you can find them, making preparation of your marketing plan should be easy.
Some businesses plan to promote through paid advertising (PPC), while other businesses do marketing promotions through social media, others through SEO, some through e-mail marketing.
Whatever your plans, make sure they’ve been around since launching your online business.
#10. Not Securing Intellectual Property
The online world is, the copy-paste world.
If the product you are selling comes from your own creative idea, if it is a video course, training ebook, then you should consider Intellectual Property Rights.
Protect your business idea from competitors, this is also copyright, trademark, patent and trade secret”as well as business property such as equipment.
If your creative idea is stolen, international decisions can be used to take your case to court and defend your copyright.
Intellectual property rights vary geographically.
So you have to take care of your rights according to the copyright laws in your country.
11. Starting a Successful Business From Scratch
You may be wondering: How do I know if I’m on the right track?
No one can predict the future, but to support in more than one small thing, here is a list of hard but rewarding work that you must do for successful online business mobilization:
· Write a business plan. · Research your type of sale: is there a demand? · Know your customers: who are you solving problems for? · Find a gap in the market: is there any value you can add? · Have a marketing plan and invest in organic search. · Avoid wasting time on small matters. · Hire assistance. · Safeguard your intellectual property.
And last, but certainly not least: hang on!
In fact, even as your business grows and succeeds, problems and mistakes don’t stop coming.
What is necessary is how you step over it. By understanding these common business mistakes from the start, you are ready to tackle any challenge that comes your way.