People spend so much energy, time, and money to keep a business up and running. However, due to poor decision-making skills, all these resources may go down the drain. When that happens, it becomes more difficult to get back in the rat race again.
Running a business entails a lot of trial-and-error, but wise entrepreneurs know exactly how to protect their business from the consequences of poor decisions and thoughtless plans. Keeping up with the competitors, especially as a startup, could also add pressure to any entrepreneur. It is essential to understand what kind of mistakes could hamper the success of a business.
Top 7 Mistakes that Could Hurt a Small Scale Business
1. Not taking the time to do a market research
Many business owners take the market research lightly which could very well end them up in bankruptcy. Certain industries are now congested with products and similar that appear similar. As a business owner, you would want to cater to the market where competition is not yet saturated.
Understand your potential customer well. See how much they need or want your products. Also, know how much they are actually willing to pay for it? If you could conduct a vis-a-vis interview with clients, do so, as this would allow you to look at your business from a different perspective.
2. Ill-timed launch of the business
As in any endeavor, timing is absolutely important. Even in the business community, you can also find a handful of procrastinators. A lot of entrepreneurs find it a bit difficult to launch due to a number of factors including inability to follow timeline, fear of getting judged right away, unreasonable level of perfectionism, being disorganized, and lack of the right resources.
On the other hand, many businesses also fail due to launching a bit early. The risks are at a high level if you tend to launch without any programs that will allow you to adopt in the selling scenario. This is why most businesses prefer to do a’soft openning; prior to the official launch of business to do dry-run on the operations of the business and to be able to anticipate any roadblock the soonest possible time.
3. Using much of the financial resources to decorations and space
While pleasant interiors can add to the overall appeal of the business, some businesses tend to go overboard with the decorations. It is essential to know that minimizing the investment on decoration and office rentals is also a practical move as these facets of the business can be improved in the long run.
The use of expensive trappings normally blinds budding entrepreneurs which eventually causes the business to go up in smoke.No matter how big your available financial resources may be, it is still wise to invest them more on the operation rather thanthe physical arrangement of the office.
4. Giving in to the temptation of incorporating too early
When a small business in the Philippines does very well, the owner could contemplate on incorporating too early and quickly. It is advised that business owners should wait at least a couple of years and observe the in’s and out’s of the operation. This is to understand better and to calculate the risks before plunging into another level of business.
5. Having limited flexibility
Having a vision is vital to achieving your business goals. It likewise helps you deal with certain setbacks that you may experience at the onset of the business operation. The vision helps you get focused on what you would like to achieve at the end of every quarter and every year. This problem is often overlooked by businessmen who have gotten used to following a ‘by-the-book’ approach.
On the contrary, sticking too much on your vision may compromise your ability to adopt to changes and problems you may encounter along the way. Running a business requires rooms for adjustments in order to cope with the demands of the clients and of the circumstances. Discarding some of the original ideas may be deemed necessary in ensuring the success of your business.
6. Not taking the time to outline a business plan
A business plan consists of components that can help you move from one step to another when it comes to putting up a business. Some new entrepreneurs may think highly of themselves and rely on something less scientific such as instincts and gut feel. Such behavior jeopardizes the business.
Writing business plans is not always easy, especially for those who do have a knack of writing. Asking someone to do it for you may work, but you will have provided all the necessary details. Better yet, you can do the initial draft and have an expert polish this document for you. Putting all your ideas in black and white will make it easier for you to organize tasks and to get things done.
7. Not communicating with customers
When cash starts to flow, some owners tend to get very confident. They may venture on offering new range of products or plan on expanding. While these two may be indicators of positive business progression, listening to your clients remains to be one of the most important keys of success. Getting your customer’s feedback should always be included in your daily targets.
If you are aiming to build the best business in the Philippines, it is a must to know all the factors that could expose your business to risks. Eliminating these factors could help your business thrive for the longest time possible. Being prudent is essential in all businesses – whether existing or just newly established.