Starting a new business throws up many challenges for the would-be entrepreneur. With many new start-ups failing within the first year, it’s essential that a new organisation is carefully managed to ensure it gets off the ground. Mistakes can be hugely costly, and can easily ruin a new business. So, here’s a list of things you should never do when trying to get a business up and running.
Don’t quit your day job
A new business can be very risky, and it can take some time before you start earning an income from it – if at all! The most important thing you can do is to not quit your day job until you’ve tested the waters with your new products and got a feel for the business, its market and the reaction from customers to your products. You’ll need every bit of money at this stage, so maintain your regular income.
Don’t spend on premises
You’ll probably have limited capital to invest in your new business, so don’t blow it all at once on expensive business premises. See if you can start your venture by working from home. If your business starts to grow, then you can start considering looking for premises.
Don’t hire staff
Hiring staff at the start of a new business can also be risky, because you’ve got wages to pay and there’s no guarantee you’re going to earn an income from the business to pay those wages. If there are elements of the business that you can’t do yourself, then outsource the work or get temporary assistance.
Don’t buy lots of equipment
Buying equipment for your venture might make you feel more professional but it could eat away at all of your capital. Only buy what you really need, and loan services of other equipment that you may need in the meantime. It’s important to note that new businesses often have to adapt and change their game plan, so buying new equipment at the outset might not be what you really need further down the line.
Overspend on advertising
The most important thing that you can do when establishing a start-up business is get the product right first. If you blow your budget on advertising, in the hope that it will support the sales of a weak product, then you’ll pretty soon end up out of pocket. Start small. If you do use advertising strategies, stay targeted. Make use of networks, social media and the internet for generating awareness opportunities that won’t cost you money.
There’s a training course out there for every aspect of starting up a business, and whilst it might seem like a necessary element to improve your knowledge, if you factor in hotel costs, travel and eating out, these training courses could work out pretty expensive. Instead, invest in some books, online tutorials or how-to guides on the internet, which are effective methods to top up your skills without breaking the bank.