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Blog post by Carrie Spencer of thespencersadventures.net
Common Pitfalls of Owning a Small Business and How to Avoid Them
Running your own business is the dream of many, but there are numerous hurdles to jump along the way. Thinking decisions through from beginning to end can help you avoid some of the typical pitfalls that entrepreneurs frequently find themselves dealing with. Here are several of those mistakes and how you can avoid making them.
Failing To Create a Business and Marketing Plan
Commencing business operations without a plan can lead to disastrous consequences. This is evident due to reporting by the Bureau of Labor Statistics, which states that about 50% of small businesses fail by the end of their fifth year of operations. To prevent your company from being a part of this statistic, think through your business and marketing plans comprehensively.
Your business plan should include information such as a description of the industry you will join, information on competitors and how your product or service will bring something unique to the market. You should also incorporate details on financials, such as how you will fund the enterprise initially and what you project your profits will be through the first few years.
The marketing plan should contain a comprehensive analysis of the market. Start with a breakdown of the size, trends and potential for growth and sales. Next, identify the target market, the people you believe are most likely to purchase your goods or services. Additionally, project a market share for your company.
Failing to Understand the Financial Implications of Your Decisions
Some entrepreneurs are passionate and creative individuals without a firm grasp of how to run a successful business that turns a profit. If you are more of a visionary than a finance guru, read up on running a financially sound company. Remember to set aside funds for development and keep exemplary business credit.
New companies also often fail to understand the importance of carrying business insurance. In enterprise, as in life, unexpected issues can and do arise. Having insurance, such as that provided by TCG Insurance Solutions, can help you rest easy knowing that if a catastrophe occurs, you are in an economic position to weather the storm.
Conducting Business With Friends
Friendly deals often have no written agreements to accompany them, and therefore can wind up with awful consequences. You can trust your friends, but you should not blindly conduct business with them. If you do decide to partner with a friend in any way, protect yourself by having a written contract signed by both parties.
Failing to Effectively Plan Product Rollout
When you launch a new product, you must effectively plan the entire process. If you rush or fail to plot out each step, you could cause the launch to flop. For a successful product unveiling, try this product roadmap template. These help you outline your strategy and the tasks each team member is responsible for in bringing the creation to the market. Roadmaps assist entrepreneurs in prioritizing tasks and setting themes, creating deadlines, understanding main points and setting business goals.
Though there are plenty of opportunities for failure when starting a business, there are also opportunities for success. Creating sound plans and understanding the market and financial requirements can assist you in creating a lucrative company you can be proud of.