Making mistakes in business is inevitable. An article in the Wall Street Journal stated, “From struggling with a business plan to hiring the wrong talent, there are a lot of opportunities for small-business owners to make mistakes, especially when starting out”. Solopreneurs and small businesses should recognize some of the mistakes that could potentially happen in their businesses. While it is valuable to learn from your own mistakes, it is also imperative to learn from the mistakes of other business owners to avoid following in their shadows. Here are 10 mistakes commonly made by solopreneurs and small businesses.
10 Mistakes Commonly Made by Small Businesses (& Solopreneurs)
- Skipping the business basics: Modern solopreneurs and small businesses tend to skip the business basics. These foundational steps are sometimes overshadowed by the power of social media. In other words, most believe that social media is a foundational step in business when in reality it is not. The best businesses start with a business plan which consists of goals, strategies, business models and much more. These foundational steps are a vital process as they help to navigate the success of a business.
- Having no other plan: Having no other plan besides the business plan is also another common mistake. There are other plans that are also important, including quarterly plans, annual plans, marketing plans and even product launch plans. This mistake is commonly made by because many ignore the fact that entrepreneurship is a series of rational choices. In other words, to be successful at entrepreneurship you will need to be strategic.
- Not executing the plan: Not executing the plan tends to happen because of fear or lack of effort. Fear of a failing plan allows many to cease at the thought of the implementation process. If this is you, then you should realize that failing will happen in entrepreneurship, but it is what you do afterward that will matter the most. Therefore, it is best to just execute the plan. Then there are also those who realize the amount of work to do and plain simply do not put in the work. If this is you, then you should realize that plans just cannot execute themselves. Therefore, it is best to just execute the plan.
- Being blinded by social media: We will not deny that there is power in social media. It is most certainly needed for any modern business owner. However, often individuals frequently forget that business is more than this. They negate important aspects such as collaborations, networking, and other joint venture partnerships. They also forget that the goal of social media for businesses is not just to get followers or likes, they forget about business policies, standard operating procedures, employee handbooks, contracts, accounting and so much more. The focal point of this mistake is to not spend so much time on social media that you forget to work on organizing the internal operations of your business. Without proper structures in place for your business, you will become an overwhelmed and overworked business owner.
- Lack of organizational structure: Once a business hits the six-figure mark or a significant increase in client workload then it is time to develop organizational structure. Organizational structures help businesses to establish different units for the goals in which the business wants to accomplish. Organizational structure does not have to be for large corporations only, but it can also be used in small businesses. Lack of organizational structure is a mistake that small businesses tend to make because they get scared when they hear the term. However, let’s take Priceless Planning (2017) for example currently we have a marketing team, administrative staff, and an executive board which operates our in-house charity. We have one goal to accomplish but different avenues in which that goal will be accomplished. This eases some of the burdens from the CEO of the organization and destroys the feeling of being overwhelmed. Popular businesses with great organizational structures in place in which we can easily spot includes, The Finance Bar, BluChic and Young, Fabulous and Self-employed Magazine, just to name a few.
- Not sticking to your area of expertise: As modern solopreneurs and small business owners say “stay in your lane”. This is tough for many however it is best explained as an example. John starts out as a marketer but John loves listening to Suzie’s podcast on finance. John takes Suzie’s tips on finance and they work for his business. All of sudden John then begins to talk to his audience on finance. The problem with this is that John did not stick to his area of expertise. While John could do his own finances, it does not mean he can do it for other people. Offering financial services risks John’s business credibility and reputation when clients become unpleased with his service. Not to mention, John is now unhappy with his business, confused on how it spun out of control, destroyed his business model and added a new service without revising his business plan. If only John stuck to marketing this would never happen. John should just stay in his lane and stick to his area of expertise.
- Believing you can do it all alone: Entrepreneurship cannot be a successful journey alone. Believing you can do it all alone will cause your business to suffer many consequences, including unsatisfied consumers, missing revenue and make your business growth stagnant. While many are scared to grow their business with a team it is needed as a CEO to keep your sanity. Implementing strong team building strategies is a great start to getting over the belief that you can do it alone. A strong team includes experts which are experts at their job, passionate, want to build with you and not against you, professional, takes initiative, generate new ideas and most importantly they understand the role of their jobs and loves their compensation package.
- Failing to lead your team: Failing to lead your team can affect your business, and cause you to miss your business goals. Leadership skills are something that comes naturally to others and some may need to receive leadership training. An important aspect of leading a team is creating job descriptions, implementing team-building activities, setting boundaries, and having standards for evaluations. Leadership for your team is as important as the captain of a ship. Without the captain’s leadership, where will the ship go? Failing to lead your team, simply put will cause your ship to sink.
- Setting unrealistic financial goals: It is so important that we make our plans realistic. You can plan to make 100k. But is that a realistic plan based on your industry or product type? Is it realistic if you do not even have an audience as yet? Creating the plan is one thing, but making it realistic is necessary. Solopreneurs and small businesses should tune out what others are saying about their business finances and focus on the reality of their own businesses when setting their own goals.
- Lack of honesty: Honesty is the best policy and this is something that solopreneurs and small businesses should stick with. While it can be hard to be patient and wait for business success, it is better than being untruthful. For example, there are individuals who are untruthful with their profit margins or how they acquire social media followers and then call themselves social media gurus or builders of a ‘millionaire lifestyle’. This is an obvious lack of honesty in business that will catch up with you in the long run. Your business supporters will love you more when you are honest.