Here’s how you can avoid business start-up mistakes:
1. The product or service
People who start their own businesses are usually led by passion about something.
Their start-up is likely to be based on their area of expertise and not a realistic research of what the market needs.
They make emotional decisions rather than business decisions. Does the market need your product, and do you have a unique selling point for it? Who are your competitors?
Are you going to do a better job than the competition such that you can dislodge some of the clients from them?
2. The target market
Do you know who’s going to pay for your product or service and how much they are willing to pay for it? How will you communicate with your target market? If you target the wrong market, chances of success are nil.
Most people go into business with limited funds, hoping to make money from the venture. They assume that the business will soon generate income and become profitable yet that can take a year or longer. Will the product/service you are marketing deliver enough income to keep the business going when your seed funding runs out and if not, what are your alternative sources of funds?
4. Business is much more than passion
Many people are so passionate about what they have to offer that they put all their energies there, neglecting the un-enjoyable aspects of running a business such as record keeping and understanding taxation. The wake up call is usually when the business owner realises that there’s no money to pay bills and that signals the beginning of the end. Without money, there can be no business.
Working alone requires a high level of discipline and some level of experience. Hiring is scary for start-ups, especially because there is no assurance that the cash-flow in the initial stages will be able to pay salaries. A new business owner can make use of part-time staff or freelancers, students who are on internship or volunteer services from family members.
No matter how great your product/ services, there can be no business unless the market knows about it. Many startups fail because their services are not known by enough people.