The rate at which businesses fail is quite alarming. Over 50% of small businesses tend to fail within their first five years, sadly some of the businesses do not even reach a year. This is something that no business owner whether new or old wants to experience.
Starting a business is tough whether big or small and that is why business owners need to gain knowledge about what it takes to build a successful business that would stand the taste of time.
The first thing every business owner should know is the mistakes committed by other entrepreneurs. Their stories will help you avoid some of the mistakes they made which made their business fail and what they were able to do to develop another successful business.
It is funny how some people feel they can do it on their own, but generally to succeed you must learn from others who have been in your shoes and we’re able to overcome. There are so many reasons why businesses fail but we’ll be looking at the 7 most common mistakes.
- Entrepreneurs overlook developing a foundation for their business
Most Entrepreneurs don’t pay attention to develop the foundation of their business, they are in a haste to do the exciting activities. You cannot excel in your business if you do not set the right foundation for it.
For example, choosing a platform to launch online, is it social media, which of the social media platforms, Facebook, Twitter, Instagram… It is important that you know which of the platforms your ideal customers hangout then launch your business on the platform.
- Expecting fast results in the short term.
Some entrepreneurs have mentors whom they admire for their success but fail to understand that their results were produced out of hard work, sacrifices and consistency to mention but few.
You need to be patient and possess the qualities mentioned. Success is not achieved overnight, it is a process and to be successful you need to undergo the processes.
- Not identifying your ideal customer.
Most Entrepreneurs make the mistake of thinking everybody is their customer. Understand that not everybody is your customer and not everybody needs your product or service. Make your research on the people who are likely to buy your kind of product or service and sell to them.
For instance, if you sell children’s clothes, your target customers are their parents and not the children, when you market to the children, they won’t have the money to buy but their parents do.
- Not finding the right mentor
Mentorship is very important in business. Mentors lead, direct and guide you in your business journey, giving you advice so you don’t have to make the same mistakes they made themselves.
Sadly some entrepreneurs do not have mentors, therefore they walk the journey on their own and most times encounter difficulties they can’t handle on their own. Others have mentors but they chose the wrong people.
- They take competition very personal.
When you are in business and you make competition to be a do or die affair, you end up destroying your business as well. No doubt in business you are meant to compete in the market space but have a healthy competition.
Trying to destroy your competitors’ business so yours can excel is very wrong, you’ll end up having a negative perception from your customers – this can affect your business.
- Avoiding criticism.
Entrepreneurs who avoid criticism in their business tend to encounter lots of setbacks. Criticism in business is meant to help you improve because people are telling you the wrongs in your business.
Some people may be rude and aggressive about it but you need to wear a tough skin to handle such, you need criticism for your business to improve so don’t avoid it, embrace it with a positive mind however it comes.
- Not accessing the performance of the business.
When you don’t access or evaluate your business performance, you will not know whether you are growing or not. You need to know what you are putting your money into and why, what to stop doing that is not producing good results and what to do more because it’s bringing results.