Most people’s aspiration is to become financially independent and be able to give their families a comfortable lifestyle. In this context, establishing their own business has been the most effective means of attaining these objectives. Still, because managing a business is not a simple matter, some new entrepreneurs err that could cause failure in their business.
Whether it’s because of a lack of experience or lack of knowledge, there are some typical business management mistakes that can land your business in trouble. That’s why it’s crucial to be aware of them so you don’t have to encounter future issues.
So, if you are looking for knowledge on how to better manage a company, check out today’s text! We have separated some of the main mistakes made by beginning entrepreneurs and we will teach you how to avoid them. Stay tuned!
1. Mixing personal and business finances
Confusing assets is one of the most common mistakes among young entrepreneurs and is mainly due to a lack of knowledge in financial management. Therefore, not being able to separate personal expenses from company expenses can cause serious harm to the business’s operation.
Many people end up using cash to cover personal expenses, such as credit card, telephone and other household bills. This is a mistake that should always be avoided, because if the practice becomes recurrent, the company may face cash shortages, preventing it from covering essential expenses for its proper functioning.
To avoid this trap, it is recommended that the entrepreneur exercise caution and planning. Ideally, only one withdrawal should be made per month, as if he or she were receiving a salary for the work performed, and thus avoid making unscheduled withdrawals throughout the month.
2. Invest before testing
Given the desire to achieve success, beginning entrepreneurs end up investing their savings without first testing the viability of the business.
A mistake like this can mean the end of a dream, representing a huge loss for the investor. Therefore, testing the product or idea and carrying out market research is essential to determine the chances of success of your venture.
3. Not maintaining a well-trained staff
One of the factors that most influences consumers’ evaluation of a company is the quality of the service provided. In this sense, having an unprepared team can be decisive in giving your business a bad reputation. After all, there is nothing more embarrassing than receiving poor service in an establishment.
Failures may be related to both a lack of cordiality, friendliness and availability of employees as well as a lack of knowledge of the product or service provided.
Therefore, invest in training and value your customers. Be present at the company and observe how contact with the consumer has been carried out. In addition, it is important to conduct post-sales surveys, evaluating, among other aspects, the service.
4. Ignoring the competition: a common mistake among beginning entrepreneurs
One of the steps in business planning is to identify and map out your business’ potential competitors. However, some budding entrepreneurs still insist on not paying due attention to their competitors.
Ignoring the performance and growth of your competitors is a serious mistake, as it will leave your company without market references. This means that you may charge incompatible prices and offer a product or service that falls short of your customers’ expectations.
To avoid making this type of mistake, create a business plan to get to know your competitors well: observe their prices, products offered, customer service, and their strengths and weaknesses. This way, you can create a more informed strategy to stand out.
5. Not investing in marketing
Marketing is essential for the survival of any business, because through it, the consumer receives the information that will make them decide to consume the product offered.
It is not enough to put a quality product on the market at a reasonable price; you need to create strategies to attract customers to your company. They need to know your brand and feel motivated to get to know your product, and this is the essential role of a good marketing strategy .
Therefore, be sure to invest in and promote your company. Define your target audience and use different channels, such as a business website, social media, email, television, radio and leaflet distribution. This way, you will be able to reach a larger number of potential customers.
6. Not accepting criticism
Making a business successful is a challenge that requires a lot of work, attention, planning and humility from the new entrepreneur to listen to criticism and know how to take advantage of it, transforming something negative into an opportunity for improvement and growth of the company.
Always seek a second opinion before making decisions and view criticism as a way to improve your activity. In addition, pay special attention to customer suggestions and complaints, always trying to provide honest feedback that can resolve any dissatisfaction.
Knowing how to deal with criticism is what defines the ability to transform and adapt the business to the needs of the consumer. In other words, it is essential for you to remain in the market and retain your customers.
7. Do not negotiate with suppliers
Not knowing how to negotiate prices and deadlines with suppliers is another mistake young entrepreneurs make. It is necessary to make advantageous purchases and ensure that they are delivered on the stipulated dates.
Keep a close eye on your inventory and make sure to buy in larger volumes so you can negotiate better prices. Also, don’t rely on just one supplier — diversify your team.
So, have you noticed how most of the mistakes made by beginning entrepreneurs are easy to solve? With everything you’ve learned today, you’ll be able to invest fearlessly in your dreams and become another successful entrepreneur !