When you have a business, you are bound to make mistakes. Even if you have a business degree, you are rarely going to be good at everything you need to do. It can be overwhelming.
We have assembled seven common mistakes people make when they are business owners. If you catch these things up front, you are going to save yourself money, headaches and possibly save the business itself.
- Not Charging a Late Fee – If you do not charge a late fee up front, it is much harder to add it later. A late fee is not a way to make extra money. Instead, it is a way to encourage on-time payment and reduce slow pays from people. If they call and complain, you can always “forgive” it one time as a courtesy. Having dependable cash flow is critical for keeping the doors open for any business.
- Not Promoting Business Where People Are Reading – People spend more and more of their time reading in social media and on their phones. So, your marketing plan must include a mobile friendly website and promotions in social media. Our magazine is an example of how this can work. Businesses pay to be featured in our mobile friendly online magazine and we push the articles out via paid social and news channels to be seen where people currently spend their time, generating many thousands of views of active, targeted potential customers.
- Never Raising Your Prices – You do not want to do a bait and switch (raising prices quickly or unexpectedly) but you also do not want to never raise your prices. Inflation and added costs to your business for other services justify a modest price increase regularly. Most customer’s do not mind a modest increase regularly in industries where it makes sense.
- Allowing Too Many Customizations and Options – If your business offers too many options and customizations, there is a good chance you are hurting sales and making your business more complex and expensive to run than you need to. Just as an example, a restaurant with too many items on the menu must stock more ingredients, hire more cooks and prep people, spend more time training people and probably end up with more food sent back. Focusing on a small but very tasty menu can improve costs, make customers happier with easier options, improve service and speed and help you be known for something very specific. These same issues could be true for an accounting firm, a retail store or car sales.
- Getting Sold Things You Do Not Need – Once you open your door people will start telling you that you need SEO, registered with Google, employment posters, signs, insurance, etc. All of these things are valid usually, but you need to understand what they are, why you need them and carefully choose a vendor if you are buying services or products. Don’t buy from the 1st person to send you an email about it.
- Not Using a Payroll Company – If you do not know how to do payroll, a payroll company is the way to go. There are a lot of forms to file and there are monthly requirements, quarterly requirements and annual requirements. Trying to do it yourself in Excel will probably result in fines if you are late or make a mistake. The small cost of a payroll company is well worth not having the paperwork headache.
- Buying Things You Think You Need To Have – Lastly, if you are just starting a business it is common to think you need things that you actually do not need. For example, many companies now run virtually without office space. You might think you need a fancy website, but you actually only need one page and active social presence. You might think you need brochures, but chances are you do not. Landline phone? I doubt it. Before you buy things you think you should buy, really take a hard look at what you really need and do not get stuck in an old way of thinking.
The last twenty years have seen a lot of changes. With cloud apps, shared office space, outsourcing and mobile devices there is a good chance you can now get a lot of work done and build a business without all of the old overhead. Keep all these things in mind and build a leaner business and you will be more successful.