Home Student & Career Tips 13 Mistakes When Starting a Business in 2023 and Solution

13 Mistakes When Starting a Business in 2023 and Solution

By
Chioma Oparah
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2

This article highlights and explains the 13 most common business startup mistakes in 2023 and how to solve them.

Starting a Business in 2021

To a layman, the idea of business is having products and services for the consumption of the public. With the evolution of technology and the internet, business has become easier than ever before. You don’t necessarily need to own a physical office or shop before you can be termed a business person. This has in turn increased the rate of competition in business.

Oftentimes, when you see the results of others in business, you’re compelled to think running a business is as easy as ABC. This ideology has pushed a lot of individuals to abandon their jobs to start a business without prior knowledge of what business truly entails.

As a matter of fact, starting a business isn’t always as easy as many people think. There are numerous things to think about and decisions to make. Sometimes, the pressure can cause you to make bad decisions.

Success in start-up businesses does not have a specific format, but there are several common and dangerous mistakes many new business owners make that can negatively impact their businesses. Unfortunately, many entrepreneurs cannot even identify these mistakes. In order to help start-ups identify these mistakes, this article idea came up.

COMMON MISTAKES OF START-UP BUSINESSES

Thus, here are some common mistakes made by start-up businesses:

1. Skipping the Planning Phase

A lot of times, people start businesses without having to plan for them. It could be that the results they see others achieve in similar businesses caught their attention, making them swing into action without having any plan whatsoever. This has ruined a lot of businesses.

The most important plans to consider in business include a business plan, a financial plan, and a marketing plan.

Planning may be tedious and time-consuming. It includes having a business idea, doing in-depth research on the business idea, finding out the market potential, etc.

Without all of these, you will be operating in the dark. Unfortunately, many businesses start without a basic plan, and like the saying goes, failure to plan is an automatic plan to fail.

As a startup, you should map out a business plan, regardless of how small. This should include how much it costs to run the business and more.

2. Not Setting Smart Goals

Goals are things you want to achieve in business. It is sometimes awesome and broken down into smaller goals to enable you to run your business easily. Goals give you direction when you first start your business and then keep you on track during daily operations.

Setting business goals isn’t a Herculean task. The important thing is ensuring your goals are SMART goals. This implies that your goals must be specific, measurable, achievable, realistic, and time-bound.

Setting SMART goals helps you identify what you want to do, the specific steps that you will take to achieve them, and lots more.

Surprisingly, many startups don’t have a set goal, while for others who probably do, the goals are not smart; hence, the business is operated in no particular direction.

3. Not Understanding Your Market and Target Audience

Having enough capital to start a business is awesome, but it is not enough to dabble in any form of business without having an available market.

A common startup mistake a lot of people make is not taking the time to understand the market and their ideal customers.

For instance, Miss A is in the importation business, and from all indications, the business is thriving. Because of this, you decided to invest in the importation business without carrying out a market survey or identifying your target audience first.

When you create a product without understanding the market and target audience, no matter how beautiful the product is, you will most likely not make any sales.

It is important to understand that building a great product often doesn’t translate into a successful business. Creating a marketing budget and trying every business that seems profitable yields nothing without you identifying your target audience and knowing where to find them.

Therefore, you need to do market research to identify who you are trying to reach, where you can find them, and how they will react to your marketing activities. These are things you must do first before proceeding with your business idea.

Show me a business that collapsed in less than six months of launching, and I will show you a business owner who made this costly mistake.

4. Avoiding New Technology

Gone are the days when people relied on owning a shop offline before they could call themselves entrepreneurs. In recent times, technology has made it very easy for businesses; people no longer need to own a physical shop or company before they can run a business.

The Internet is the new gold. As technology advances, lots of startup businesses evolve online. Many business owners have embraced this beautiful opportunity. As small business owners, we know that technology can provide opportunities worldwide. More so, embracing technology enables you, as a start-up, to work efficiently across the world as well as save money.

However, the mistake a lot of people make is shying away from leveraging new technology for one reason or another, and as such, they tend to miss out on beautiful opportunities. One of the reasons for common misconceptions is that it requires one to be technical.

New technology may look difficult to adopt, but it requires time to learn. An unwillingness to adapt to technological advances can affect your business. This is a mistake that should be avoided by all means.

5. Being Afraid of Marketing

This is another mistake many start-up businesses make. Some people believe that marketing is strictly for big brands, and for this reason, they tend to push this important aspect of business aside. If only they knew that marketing is an effective way to grow a business.

Marketing comes in various forms, from word-of-mouth referrals to traditional advertising involving television, flyers, radio, etc., down to Internet marketing.

There is no perfect marketing strategy. The type of marketing you choose depends on your business and your target audience.

Assuming that business will come to you and you don’t need to incorporate marketing into your business is one hell of a mistake start-ups make.

6. Undervaluing Your Products or Services

As a start-up, there is a high possibility that you might want to do whatever it takes to attract and retain customers. To achieve this, you may choose to sell at a very low price.

Well, it’s not your fault, especially when you’re not conversant with the business world. Many times, a lack of confidence and fear of failure cause start-ups to underprice their products and services.

While this may seem like a good strategy, over time, it begins to rub off badly on the business. One enjoyable thing it does is undermine the unique value you bring, giving room for frustration. Recovering from undervaluing your products and services over time is always very difficult.

Always remember that if you attract customers with freebies, you must be willing to retain them with freebies, or else the crowd will disappear as fast as they came.

Thus, don’t undervalue your product or service, but don’t be too expensive.

So, if you are good at what you do, don’t be scared to fix your price accordingly. The best strategy is to get your customers used to paying for your services accordingly and not give them the impression that you’re running a charity organization.

7. Overspending

Starting a business doesn’t have to require a large amount of capital. The Internet has made it very easy to start a business with little or no capital. But some new business owners believe that they must spend huge sums of money to purchase equipment and hire people to meet standards. Creating and sticking to a business budget to check overspending is always a great idea.

So, put your money to good use and stop trying so hard to invest in irrelevant things.

8. Doing it All Alone

As an entrepreneur who’s just starting, you may be required to handle a lot of things all by yourself. While this is expected, it is not always wise, especially for a start-up. It is always important to have experienced people around for counseling and advice

Avoid trying to run a new business by yourself. Find trustworthy, seasoned advisors to discuss your business ideas, strategy, challenges, and progress, as well as brainstorm on everything and anything concerning the business.

On the other hand, delegation of duties is one way start-up businesses can grow. Doing this allows the business owner enough time for other business activities.  Not only that, it also gives room to build a team positioned for future success.

9. Fear of Failure

Many startup businesses are scared of failing, and for this reason, they try to avoid anything that’s likely to cause failure.

In many cases, playing it safe early in business caused more harm than good. It restricts you from embracing opportunities that will most likely cause the business to grow.

Failure is key to your success, and it’s important to note that no matter how careful you are as a startup, mistakes are inevitable. So, why not learn from them and grow?

10. Partnering With Wrong Investors

Oftentimes, getting adequate capital for the business is a major challenge for many start-up businesses. For this reason, these businesses are looking for investors. This is a good idea, but it is also very important to know that an investor is more than just a financial helper.

Hence, a company’s first set of investors may make or break the business. So, it’s important to scrutinize and ensure who you’re partnering with as a startup.

11. Don’t Hire Immediately

In life, there is time for everything. So also in business, there is time for everything, but it’s quite unfortunate that a lot of business owners don’t understand this. As a start-up business, being quick to hire workers is not always a smart thing to do.

This is one of the biggest mistakes startups make. Except you’re loaded financially, don’t be in a hurry to employ full-time workers; run your small business with part-timers, contractors and the services of other professionals

On the other hand, make sure you have hard-working generalists who can do everything you need them to do. When you begin to grow, you can proceed to hire full-time workers.

12. Launching Too Quickly

Another mistake startups make is launching before they are ready. Once you have launched into the public, you will definitely start getting clients.

The reason why it’s not advisable to launch quickly is to ensure that your systems and processes are in place, such as payment terms, communications, etc. The back-end processes need to be okay now before you start taking on clients.

It might be easy to want to launch out and expand once you start seeing a little bit of success.  You may find that your period of growth was only temporary and end up stuck with a bunch of new staff but no work and no funds to cover them. That’s why it’s important to expand gradually.

13. Implement a Proper Bookkeeping Process

Bookkeeping helps you make smarter business decisions and spot opportunities early. Understanding your finances also helps you keep an eye on your business’s financial state. With proper bookkeeping, you will know when you’re making profits and when you’re making losses. It will also give you a clue as to where and what you’re spending your money on.

Unfortunately, this aspect of business is given little or no attention by business owners. In fact, many people in business do not have a clue how to go about bookkeeping because it is tedious.

A Lot of startup businesses start without a proper bookkeeping process in place, and this singular mistake has ruined many startup businesses.

CONCLUSION

Considering the way many entrepreneurs flaunt their businesses both online and offline, one would be made to believe running a business is stress-free. This has compelled a lot of people to move into businesses with little or no knowledge about what is involved in running a business smoothly, and as a result of this, many start-ups crash in a few months of operation.

It has become so evident that there are numerous mistakes made by start-up businesses. While some of the mistakes are known to many, there are some who are not aware of them. It may be aware, but do not take them into consideration.

A startup is not built by one person alone. You might be the owner of the business, but you cannot successfully run it alone.

At some point, you will need to surround yourself with experts and mentors you can learn from. This will help you avoid certain mistakes. This does not completely rule out the fact that mistakes are inevitable in business in general.

Fear of failure is one of the mistakes that has held a lot of startups back from trying new things. Remaining in your comfort zone as a start-up is a costly mistake to avoid. Taking calculated risks can either make or break you, but what’s important is learning from those mistakes to become a better entrepreneur.

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2 COMMENTS

  1. It can’t be stressed enough just how difficult it is to begin a business. However, I think that you went over many of the important pitfalls that should be avoided. Taking one’s time to not only build a foundation but find the right people, just to name a few preliminary efforts, is essential.

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