As detailed in the popular infographic below, here are the 9 common mistakes entrepreneurs tend to make when they go into business.
- Wrong Choice of Business
First and foremost, choosing the wrong business idea will inevitably lead to failure. It is important to research the viability of any startup and decide whether or not the idea is the best option for you.
- No or Inadequate Business Plan
Similar to the age-old, grade-school writing theory of planning your essay before you actually begin writing—you must also plan and outline your business concepts before you actually begin working. Ignoring this stage will only hurt you in the long run.
- Lack of or Inadequate Experience
Unfortunately, you need experience in order to succeed at most things in life, and running your own business is no exception. Lack of experience in either the specific niche or in running a business in general is a major problem among entrepreneurs pursuing a startup.
- Lack of Passion
Passion is probably the most necessary quality for an entrepreneur. Without passion for your startup, it is surely a recipe for failure. When the going gets tough, it is passion for your business and product that will help propel you to success.
- Many Businesses at the Same Time
When entrepreneurs fail to focus on one good business idea and instead, jump from one idea to another. It harms all potential for each of those ideas. Ultimately this lack of focus will usually lead to the entrepreneur’s downfall.
Not adequately analyzing the competition before venturing into a new business can also be extremely detrimental. It is key to understand the saturation of the market you are entering and be realistic about whether or not you have the capital and expertise to overcome your competitors.
- Poor Customer Service
Excellent customer service is important for all businesses. It is the way businesses handle the negative situations they encounter that ultimately define who they are as a company—and it is even more important for startups competing with well-known and trusted companies. Ensuring that your customers are treated professionally is paramount to success in the entrepreneurial world.
- No Mentors or Advisors
This tip goes back to a lack of experience—in other words, you can’t have too much experience on your side. So take advantage of the connections that you have made in your entrepreneurial journey. Through the guidance of mentors and experienced advisors, you may avoid some costly business mistakes.
- Charging Too Little
Though many entrepreneurs falsely believe that lower prices are the only way to survive and beat out the competition, there are always other ways to gain a competitive advantage. Though this strategy may work short-term, it can lead to cash flow problems or business failure in the future. Analyze the situation, discover what differentiates you from your competitors and convince consumers that this is the reason they should give you their business.