I have never seen a successful entrepreneur who can admit that he/she has never made a mistake. Most entrepreneurs know that mistakes are inevitable and sometimes seemingly harmless errors could shutdown an entire startup in the long run. This is especially true when you are still inexperienced. In fact, most of us learn best from our own mistakes. And just like the saying goes, experience is still the best teacher.
Smart entrepreneurs however know that they don't need to make the mistakes themselves before they can learn. They rather choose to learn from the mistakes of others. This is because some mistakes are so deadly that it can actually cripple a business.
Let's face it: this is 2016. A whole lot of businesses are springing up every day, making the already fierce competition fiercer. One thing your start-up cannot afford now is a mistake that will make it lag behind in the competition. In fact, some of these mistakes are so deadly that they can actually cripple your business.
So if you want your start-up to be ahead of the competition and thrive this year, you must avoid these deadly mistakes.
Here are seven of such deadly mistakes:
1. Taking uncalculated risks
It is okay to have big dreams. However, a lot of start-ups miss it by being irrational in the pursuit of their dreams. They don't stop at dreaming big, but equally take uncalculated risks too. Most times, this is because of greed, impatience or lack of insight.
Taking uncalculated risks usually backfires, and it could ruin your start-up. Don't make that mistake. Take risks, but make sure you don't test the waters with both feet.
2. Not preparing for the worst
Preparation for success is great, but what proves your start-up has a future is if you also prepare for failure in advance. Not preparing for possible unpleasant events means you didn't take everything into consideration during your planning process. It doesn't mean they are bound to happen. It just prepares you to be able to handle challenges better if they occur and make critical decisions fast. The business world is very unreliable. Expect the best, yet prepare for the worst.
3. Having a negative outlook
Fine, the economy has not been so wonderful lately, and things have not been looking so good on many fronts. But having a pessimistic attitude is not going to make things any better for you or your start-up.
Pessimism is like a disease, a virus that spreads. If it enters your business, it will destroy it completely. No matter how bad things may look now, it can always get better. That attitude has helped me a lot of times in the past, especially when I was still starting out and things didn't look so bright.
Try it out. Believe things will definitely get better, and watch as they certainly do with time, hardworking and perseverance.
4. Shunning Networking
Networking is a necessity for the survival of today's businesses. Highly recommended business books like "Never Eat Alone" by Keith Ferrazzi teaches the essence of connecting with your target market and partners that influence your business by maximizing relationships, while building momentum in your professional networks.
It's important for entrepreneurs to never think they know it all. When my start-up was still less than a year old, networking was what I leveraged on to break through the market.
All I did was to meet a respectable entrepreneur in my city and get him to patronize me. After that he gave me a couple of referrals which helped me land some major deals immediately.
Moreover, it is almost suicidal for any small business not to have an online presence now, especially with the social media boom. The internet has played a major role recently in how successful any start-up can be. And there are so many reasons your start-up needs to invest in e-commerce.
Similarly, your start-up needs a social media presence now like never before. According to this data, 90% of American adults now use a smart phone. Most of the times, a heavy chunk of an average person's time is spent on social media.
Just imagine the traffic you can drive to your start-up if your social media channels are working optimally. Luckily, you don't have to get worried about how to go about it. Most of these social media sites can be used for business, and they are easy to operate.
5. Procrastinating on important task
Procrastination is not just the thief of time, but of destiny. Many start-ups suffer greatly because their owners are still battling with procrastination.
No matter the kind of start-up you are operating, putting off a task until 'later' doesn't make the task get completed. Rather, it expands that task.
It's important to create a habit of consistency, especially when leading a team. From experience, I've realized that one person's inconsistency can literally affect that of others. But once a leader or entrepreneur gets it right, they can help eliminate the habit of procrastination from the company as a whole.
6. Bad Customer service.
Many businesses have lost millions of dollars in sales in the past simply because they neglected a customer. It is deadly to look down on a customer simply because he merely bought a product or paid for a service worth less than $25.
I understand the exasperation that comes with trying to satisfy a customer, especially when that customer seems not to have a lot of money to spend. In spite of that, you should never make the mistake of looking down on 'a less valuable' customer. This is for two main reasons.
First of all, the not so valuable customer who spends $12 each time he/she visits your business, could be worth $1 million tomorrow. And if he needs a service you offer, or a product you sell, he will return.
Secondly, $25 today could mean $1000 at the end of the year. That means that the real worth of your customer is approximately 50 times what he buys weekly from you. Having that mindset will help you treat them well, and ensure that they will return tomorrow.
7. Starting with hope of quick profit
Sometimes businesses overestimate their Returns on Investment (ROI) mostly to please investors or to get 'quick money'. These days, when I see an aspiring entrepreneur, one of the first questions I ask is, "Can you continue in this business for the next one year if you don't make any profit?"
If he/she answers in the affirmative, that means he will be able to stay put even when things seem not to be working.
While profit is definitely important to sustain a business, it's important to understand your market, create sustainable solutions and ultimately have a concrete motivating factor that drives you from within beyond profit.
My Recommended Business Book of the Month: Never Eat Alone by Keith Ferrazzi