The small business owner is often used as the example of how America is built. Entrepreneurs make our country great, in my view. However, a new business owner can put their heart and soul (and financial savings) into a new business only to have several predictable mistakes derail the company.
Here are 3 key mistakes that each new business owner should be aware of with solutions to resolve.
First, “being cheap”. For each dollar you save you might increase that smile on your face. But if you get too carried away with saving money, you might end up losing opportunities and customers.
You should develop a plan and account for those new and fresh opportunities, that will come along. Say, 10%-15% of your operations budget. Remember, as you have no doubt heard or read, “Rome wasn’t built in a day.” However, the Romans were pretty darn smart about succeeding and were always looking out for new opportunities and were making investments where it mattered. Several on my list would be: training, recruitment of staff and facility enhancements. There is one more. Keep reading.
Second, “refusing to hire those who might be smarter than you.” Yes, a staff member might know more than you about a particular aspect of your business, but it does not mean he or she, and the rest of the team, won’t respect you as a leader.
True, you have to earn that respect, and you might need to work on that to do so, but it will result in dividends. In my company I have a number of associates that are smarter than me. That is why they are here. Collectively, we can do more for our clients than if each of us individually was left alone. Look, my clients respect the fact that I have such a strong team. They also appreciate that I have the confidence to allow them to have a real impact in key decision making.
Finally, “not allocating a PR or marketing budget”. Yes, I know you likely saw that coming. It ‘s so true! I have a new client questionnaire that I use. The form includes this simple question: “Do you have a public relations or marketing budget?” I can’t tell you how often the respondant marks a “no”.
A consistent marketing effort is needed today, especially in an economy that is becoming more competitive. Failing to have a approved budget for campaign planning, traditional media usage, social media and crisis communications, among other key aspects of promoting a business, is placing your PR and marketing program well below everything else in priority order. In our experience, a new business should allocate about 7-15% in operating funds for public relations and marketing. The funding can vary depending on milestone goals to deliver product and services to customers. Look at this budget as an investment. Not as a cost.
So yeah, much can go wrong when starting a business. However, working on these three predictable mistakes will make the journey more productive and reduce the risk of failure. Good luck!
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