Mistakes in business must have come to every entrepreneur and most of them are familiar with failure in their first year in business. Business owners who survived critical times might tell you that they did not achieve success simply because of the spirit to rise. In the meantime, you can also visit the Chad Arrington website to get more business tips.
It takes hard work and it does not happen overnight!
This article will invite you to take a look at the “sin” or mistake in business that causes a lot of entrepreneurs, especially those who are still newbie failed in their early years.
1. Not Set aside enough Backup Cash to Support Yourself
One of the most common mistakes in business to entrepreneurs and causing their business to fall is NOT because of a bad business model, or an entrepreneur’s figure who is not good enough to make a business work, but the fact is financial.
Most entrepreneurs run out of money to support a business or themselves before a business generates profit to support itself.
Tip: Proactively set up a special fund that is used to support yourself during business is still in the startup phase.
Be aware of what kind of needs you will put on the list and prepare the funds because you want the ultimate outcome.
You also want the funds to support you for 1-2 years and reduce the pressure when there is a rise in the business.
2. Using Overly Optimistic Assumptions During Planning
Lots of entrepreneurs who are still newbie falling into error in this one business.
They do have a good idea and convince their friends and family that the business can run smoothly and do not have to think long.
They immediately jump into the field and then realize there are some minor details that they fail to consider or there are some parts where their assumptions are too optimistic.
Be honest with yourself. Are you being petty when the time comes to get the first client? Are you set too high a demand for the product? Do you assume that there is no risk if you do not follow anything that can cause errors?
Tip: Find 3-5 truly objective people (not friends or family) and have them specifically play as devil’s advocate to help identify weaknesses and take steps to address them.
3. Not Exactly in Evaluating Your Business Model
Not everyone combines the business model into their planning and it is actually an easy thing to do when you want to incorporate it into your business concert.
But there is something even more important: to start evaluating objectively the whole of your business model and making sure it has the potential to make a profit.
A simple but often tangible fact is to have a good idea that is not necessarily easy to translate into a profitable business model.
When you are evaluating a business model, you are actually looking at whether the business can continue or it’s time to move on to other business ideas.
Tip: You may consider SCORE or a small business development center to assist you in evaluating business models and expert advice.
Their perspective can identify a more suitable and reasonable business structure from what you have set before.