According to statistics from US Census Bureau, an estimated 76% of small businesses operating in the year 1992 were still up and running until the year 1996.
Moreover, based on US Department of Labor findings, only 17% from the small businesses in the year 1997 closed due to bankruptcy issues.
So if you are planning on setting up your own small investment, most definitely you wouldn’t want to be included in that slim 17% chance of failed business, right?
And for that, it would be practical to get yourself familiar and knowledgeable about the 10 startup obstacles you have to watch out for to avoid yourself from committing common mistakes in this field.
#10: Underestimated Market Research
One of the crucial foundations of a successful and fruitful business is a solid concept and idea.
But how do you assess if your idea of this new business is good enough for your target clients?
Your families and friends might think that it is incredible to invest in such field, but do your potential customers think the same?
Every potential business owner must understand that it is crucial to account the size of their potential market, the demographics and the little details that make up the bigger picture.
With this, it is always good to talk to credible sources of statistics and data such as Census, the Department of Labor and the like.
#9: Substandard Business Plan
You might have heard about the “paper napkin” fantasy of men having only a sheet of napkin where ingenious ideas are scribbled and then expect huge returns later on.
While this could work sometimes, you should not expect to get your business somewhere successful because the truth is, no business has ever recorded to succeed without a thorough and detailed business plan.
A business plan will help you focus on the goal of your scope and mission of business.
#8: Insufficient Startup or Capital Money
One of the highlights in 10 startup obstacles is the assumption of instant profitability leading to poor or no cash flow. For every business, gaining stability and balance in the market will not immediately felt, of course. With this, it would be practical to plan for a detailed budget that can sustain operations within the first 2 crucial years.
Figuring out your sufficient startup capital will help you get through the “bad and tricky times.” Moreover, to ensure that you are spending well on your investment, you must separate luxury from necessity as admit it or not, starting up your own business could be overwhelming and exciting leading to impractical spending to unnecessary business equipment.
#7: Compromised Pricing
Another common mistake that most budding business owners encounter is the desire to beat the competition by charging too little and compromising your investment. You may think at first that this is the key to attract customers but later on, you will figure out that this will not work on your end.
The key to solving this is to learn how to build relationship with suppliers giving you a leeway when it comes to acquiring bulk and wholesale orders at a cheaper cost. In this way, you could offer your products and/or services at a lower price compared to others without actually compromising your investment.
#6: Awful and Poor Marketing Techniques
Surely you have realized by now that one of the most crucial and fundamental ingredients that make a business successful is the impressive and eye-catching media exposure.
The key in battling with this ever-consistent mistake is to not be dazzled by glossy brochures, billboards and television commercials or magazines and newspaper ads. Your first and foremost consideration should be on the budget and then the technique.
Keep in mind that incredible and practical advertising means need not be expensive. You just have to study and understand first your market.
#5: Shallow Reasoning for Focus and Motivation
Motivation plays a very important role in every little step that people take in their lives. Making a decision towards something with a rock-solid stand in heart and mind could definitely help in making everything as smooth and successful as possible.
Many entrepreneurs end up wasting time and money because of wrong motivation and lack of focus on what they do and what they perceive to achieve. Wrong or unstable source of motivation could directly equate to poor commitment, hence poor management performance is also expected in handling the business.
#4: Forgetting about Other Things
While a strong push is highly necessary to keep your focus and drive in achieving your goal, unmanaged commitment is also unhealthy. Businesses do require huge time and effort in order to run; however, forgetting about other important things such as family and friends could also be detrimental.
Maintained strong bonding with family and friends could help someone get through whatever stress and hardships running a business could throw at someone.
#3: Unmanaged Debts with Families and Friends
While support from family and friends is a fundamental aspect that has to be maintained, business owners should still think twice about running to family and friends for financial support.
It is always a practical option to resort to banks and other financial organizations for support as unmanaged debts with your loved ones could cause trouble and dilemma later on.
#2: Hoarding All the Work
You are not a superhuman; you need help from others and pushing yourself too much could really cause a huge downside on your business. Although this could be a pretty great strategy to cut costs, this will not be a smart way if you want to secure long term success in your investment.
#1: Lack of Credible Office Space and Location
To complete the 10 startup obstacles that most budding business owners fail to see and address is the odd location for their business.
Even though you have the best and most reliable company that offers undoubted services and products to people, not having the good location may simply throw out every effort, money and potential you have.
Location and office aura could directly lessen the credibility of your company, thereby affecting the number of clients to trust and resort to you for their needs. With this, one of the best moves to battle with this dilemma is by considering other alternatives such as virtual offices, HowStuffWorks explains this in depth.
This could practically boost up your image in an instant as it can provide you the best perception of your business with a prestigious location, signature and website as well as customer service hotline for your customers.