Sharon LaMothe
LaMothe Services, LLC
http://lamotheservices.com/
Q: I really have no choice but to start a business as I have been out of work for too long. I'm excited about getting going but what should I be on the lookout for -- what mistakes can I avoid? Ed
A: This is a good, smart question. While it is true that small business owners tend to be an enthusiastic, optimistic bunch, that same enthusiasm can be a hindrance when we think that all of our ideas are great ideas.
They're not.
Here, then, are the 5 Most Common Start-up Mistakes (and how to avoid them):
5. Not looking before leaping: Sometimes you have to jump right into a new business -- an opportunity presents itself, the time is perfect, whatever. But far more often you do not have to dive in headfirst (and you should not).
Take a breath, slow down, stand back, and take a critical look at your venture before investing too much time or money.
- What could go wrong?
- What part of your plan is weakest?
- What if things don't go as planned?
- What's the deal with your competition?
This sort of critical analysis will serve you well. It can help to point out danger signs and potentially save you from making an expensive mistake.
4. Starting with the wrong legal structure: No, there is nothing juicy about this tip, but it is vital nonetheless. Most small businesses start out as sole proprietorships. Most small businesses are making a big mistake.
Legally speaking (and I can say that as I am a "recovering attorney"), a sole proprietorship offers you no protection. If something goes wrong with the business, you personally are on the hook. But if you incorporate, the corporation is a separate legal entity from you. That is a main reason why people incorporate or form LLCs.
3. Lack of a marketing and advertising plan: When you start a new business, it is like being alone in a dark room -- you know you are there, but no one else does. The only way you can turn on the light and let people know you are out there is by advertising and marketing your business.
Read some books about marketing (my book, The Small Business Bible, might be a good place to start). Take some online courses. But trial and error is, unfortunately, the best teacher in this regard. Market and advertise your business, and then do it some more.
2. Undercapitalization: Yes, it is true that most start-ups begin with less than optimal funding, and yes, it is also true that many small business have overcome that obstacle, but it is also true that you will have a far higher likelihood of success if you have enough money to start properly.
How much?
At least enough to run the business and live for six months, while you get established. You simply don't want to be forced into having to choose between paying the rent and running the ad as you are trying to get your business off the ground.
And the #1 preventable start-up mistake is...
1. Having no website or a bad website: Your website is your business card in this century. One of the first things potential new customers will do is Google you and look for your site. Having no site, or maybe worse, a bad site, can kill your nascent business. And since it is so easy to get a professional site these days for next to nothing, there is no excuse for not having a great site, right from the get-go.
(Runners up: Not having a social media strategy, not being passionate about your choice, or failing to take advantage of all the free help out there.)
------------
Steven D. Strauss is one of the country's leading small business experts. The senior USATODAY.com small business columnist, his latest book is the Small Business Bible. A lawyer, author, and public speaker, Steve speaks around the world about small business and entrepreneurship, including a recent visit to the United Nations. He has been on CNN, MSNBC, ABC, and The O'Reilly Factor among many others, and his business column, Ask an Expert, appears weekly at USATODAY.com. .
Posts
No comments:
Post a Comment