Starting a small business is a challenging and exciting endeavor. But it can also be overwhelming, especially if you're not sure what you're doing. To help you get started on the right foot, we've compiled a list of seven common mistakes small businesses make and how you can avoid them.
1. Charging too little for services or products
Many small businesses charge too little for their services or products and do not profit enough as a result. If you're not making enough profit, you won't be able to reinvest in your business or pay your employees a livable wage. Research how much small businesses like yours are charging to make sure your prices are competitive. In case you need to increase your prices, do it gradually so you don't lose any customers.
Many small businesses charge too little for their services or products and do not profit enough as a result. If you're not making enough profit, you won't be able to reinvest in your business or pay your employees a livable wage.
2. Failing to set clear goals
It's important to set clear goals for your business and create a plan to achieve them. Without goals, you'll likely find yourself wasting time and resources. And, when it comes time to measure your success, you won't have anything to gauge your progress against.
Ask yourself what you want your business to achieve in the short and long term. List down your goals and create a realistic timeline for achieving them. Then, check your metrics regularly to ensure you're on track.
3. Hiring many employees too soon
Hiring a lot of employees immediately may seem like a good way to get things done quickly, but it can also lead to problems. For one, you'll have to spend much of your budget on wages and benefits. Also, you might not have enough work for everyone. This can lead to high turnover rates and low employee morale. You can avoid this by starting with only a handful of employees to perform core tasks and only hiring more employees once your business grows. You can also outsource to contractors and freelancers to meet short-term labor requirements.
4. Not tracking your finances
Not tracking their finances properly can lead to problems like not knowing how much money you can spend or not being able to pay your taxes on time.
Keep tabs on your income and expenses so you can make informed decisions about your business's finances. For instance, you can invest in accounting software to help you track your income and expenses, and to create financial reports. Also, consult with a financial advisor regularly to make sure your cash flow and profitability are stable.
5. Using too many social media platforms
Many small businesses try to reach as many people as possible by leveraging all available social media platforms. However, this can be a time-consuming and costly strategy. You might post a lot on Twitter, but you may find that users don't interact much with your content.
Instead, focus on just one or two platforms that are relevant to your business's target audience. For example, if you're targeting millennials who love shopping online, consider using Instagram and Pinterest. This way, you can better engage with your target audience and optimize your social media marketing efforts.
6. Not keeping up with industry changes
The business world is constantly changing, so it's important to stay up to date with industry changes. This way, you can adapt your strategies accordingly and stay ahead of the competition.
If you're in the retail industry, track changes in consumer spending habits. If you're in the tech industry, stay abreast of the latest trends in IT. Read industry publications and attend conferences and seminars to stay informed. You can also follow industry thought leaders on social media or sign up for their newsletters.
7. Failing to invest in cybersecurity
Many small businesses don't invest in cybersecurity because they don't think that they are at risk of attacks. But in reality, cybercriminals are constantly targeting them because they lack cybersecurity expertise and have weaker defenses than large enterprises.
Invest in cybersecurity solutions like antivirus software and firewalls to protect your business from malware, phishing attacks, and other threats. Take the time as well to educate your employees in cybersecurity best practices. Additionally, consider investing in cyber insurance to protect your business's finances in case of an attack.
You can also consider partnering with a reliable managed IT services provider like Complete Document Solutions. We will not just monitor your IT infrastructure 24/7/365, but we will also protect it from all known threats. Request a network and IT assessment today, or download our FREE eBook.