Check out this resourceful article from Score.org columnist Steve Strauss. Score is a great resource center for entrepreneurs in all walks of life.
1. Taking on too much debt:
Most entrepreneurs have to take on some debt to fund the dream. That is expected and fine. But you simply must 1) keep that indebtedness to a minimum, and 2) have a plan for paying it back from the get-go.
It will take a while for that new business to begin to generate revenue, and while that happens your debt load will increase due to interest. And the bigger it grows, the more it threatens the lifeblood of your business, your cash flow. Keep your debt low and get out from under as soon as possible.
2. Having no marketing plan:
As I am wont to say, starting a new business is like being alone in a dark room – you know you are there but no one else does. The only way to turn on the light, the only way to get people to know you are out there, is through marketing and advertising.
It need not be expensive. There are scores of ways to get the word out without breaking the bank – everything from tweeting to flyers to creating a viral video can work. In fact, over at my site, www.MrAllBiz.com, I offer a webinar called Marketing on a Shoestring (click “Webinars” on the homepage).
Market and advertise your business, and then do it some more.
3. Not choosing well:
This may sound a little amorphous, but it’s not – it has to do with looking before leaping, and that is always a good idea in business. For instance, some people get so excited about a business idea that they don’t really stand back and give it the proper, objective analysis they should. .. and then, for instance, they are surprised that the rent at their store in the mall makes turning a profit quite challenging, or that this franchisor is hell to work with.
Other examples of not choosing well include:
Partners: Before going into business with someone, do a project or two together. See if your styles are compatible. See if you think about money and growth the same way.
Vendors: A contract with a bad vendor can doom your business.
Bad location: It could be too expensive, or maybe it is too off the beaten path.
Choose wisely, grasshopper.
4. Not having a great team:
There are 20 million businesses in this country that are one-person endeavors – solo practitioners, freelancers, independent contractors and so on. That is all well and good, but it still does not mean that you have to be totally on your own, and you shouldn’t be. The problem with being too independent is that there is not another person around to give you feedback and share the work.
So the important lesson here is to take advantage of the help that is out there:
– The Small Business Administration (SBA) and its Related Small Business Development Centers (SBDCs) offer tons of no-cost and low-cost counseling and seminars.
– SCORE does this too.
– Business schools need businesses with which they can place interns.
– Part-time employees can be hired inexpensibvely.
– Business associates can become an informal board of advisors. Other entrepreneurs can become part of your mastermind group.
