If you’re a young entrepreneur taking your first steps into the world of business, you are soon going to find that, although building your own business can be immensely rewarding, it can also be exceedingly difficult.
If you don’t want to be one of the statistics – one of the 80 percent who folds in the first year of business, there are some important pitfalls that you’re going to want to avoid…
Not Being Willing to Invest
So many entrepreneurs think they can start up a business on a shoestring with little more than a website and a dream. Sure, a few of them might be able to make that work for them, but for most of you, investment is essential, and you will need to gather as many financial resources as you can if you want to succeed.
Not Always Have a Contract
If anyone tries to do business with you without a contract (apart from customers buying the end product in a store, for example), then do not trust them. If you don’t have a contract, then you have no legal comeback should something go wrong and a relationship with a supplier break down or if you get into a dispute with an employee for example. Contracts keep you safe and ensure that you don’t get ripped off, get paid when you’re supposed to and can defend yourself if and when necessary – use them.
Not Using the Latest Technology
Whether it’s using the latest 3D software to create access panels for use in homes and businesses or including augmented reality as part of the new handheld games console you’re developing, not making best use of the latest technology available to you is a pitfall you can ill afford. Why? Because you might not be using them, but your competition will and that will mean not only can they undercut you (newer technology is usually more efficient), but they can offer the consumer newer, better more exciting features. If you don’t use the latest tech, you’ll be left behind in the dust.
Not Taking Advantage of Automation
In a similar vein, not using automation wherever it is possible to do so, from your data collection to the production line, is another thing that will make you less competitive than the competition. We are living in a time where more processes than ever before can be automated, so make use of it!
Not Covering Yourself Legally
You should absolutely not be running any business from a street food cart to a content writing company without ensuring that you are fully in compliance with industry law and the law of the land and that you have liability insurance to protect you should anything go wrong – it’s just asking for trouble.
Not Having a Business Bank Account
If you mix your business finances up with your personal ones, you’ll make it much harder for you or your accountant to accurately assess the state of your business and how much tax you need to pay and you’ll create a headache that you don’t really need. So, even if you’re only a minor solopreneur, get yourself a business bank account.
Avoid these pitfalls, and you’ll have a fighting chance, ignore them, and there’s a good chance you’re going down.