As a small business owner, you want your business to grow—whether that means expanding your current product line or breaking into a new market. Unfortunately, the road to new business can be rough and most business owners—especially newbies—make mistakes that can easily be avoided.
Below are the seven most common deadly sins to avoid when growing your small business:
1. Failing to Perform Market Research
Many business owners are so eager to bring their product or service to market that they fail to first conduct the proper market research to determine if there’s truly a demand. Conducting market research will give you valuable insight into industry and consumer trends to help you successfully launch your product. The companies that do the best are the ones that do their homework.
2. Lacking a Formal Business Plan
Many small businesses fail because of fundamental shortcomings in their business planning. Think about it: You wouldn’t plan a large-scale event without careful, methodical, strategic planning, would you? The same goes for your business. Make sure that your business plan includes the following: short- and long-term goals, market strategies, competitive analysis, pricing, and more.
3. Assuming the Competition is not a Threat
Even if you have the latest and greatest product, never assume that you don’t have competitors. Make sure to assess your direct and indirect competitors as this will help give you a platform for differentiating your brand. How you handle the competition can be directly linked to the success or failure of your company.
4. Setting Unrealistic Goals
It’s easy to get caught up in the entrepreneurial spirit and set unrealistic financial goals. Don’t set your business up for failure; rather, set reasonable goals and expectations based on existing data. It’s far more satisfying to hit a smaller, achievable goal than it is to miss a big, unrealistic one.
5. Not Keeping Track of Your Finances
When growing your business, there’s a lot of cash being moved around. Don’t let your finances run wild. Stay on top of receivables, receipts, debt, and expenses. Most importantly, monitor your business credit file as even the slightest change in your rating could affect your relationships with customers and suppliers.
6. Forgetting to Put the Customer First
Don’t lose sight of your customers. In the early stages of development, bring together a few of your most loyal customers to learn a bit more about their challenges and ways you can help solve them. The surest way to achieve success is by putting the customer first.
7. Missing a Marketing Strategy
Entrepreneurs rarely plan or budget for marketing expenses because they believe it’s a frivolous expense. Before you can make a sale, you have to create demand, which is only done through marketing.
Amber Colley is a Business Credit Expert and Director with Dun & Bradstreet who brings 20 years' experience helping businesses of all sizes grow and prosper. She has coached thousands of business owners on establishing a business credit profile that will get them the funding, cash flow, and finance terms they need.
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