Starting a business can be really hard. And making small mistakes early on can make it even harder to get going. The starting steps of a business are very similar to building a house – if the foundations aren’t right then everything will fall over, even if you have something amazing to build. Now realistically, you can’t do everything right from the start, and it’s perfectly normal to make mistakes. Most of the time, the best way to learn is by making mistakes. But reading these 10 tips below might give you more of an idea on what kind of mistakes you can avoid making in those early days.
1) Have a plan!
Without a plan how can you know where you’re going? Now, this doesn’t mean you can’t do anything in business until you write a business plan. But what you do have to do is know what direction you want to take your business. Document what it is you want to do, what you want to achieve, who you want to target, where you’re going to do it, who is going to do it and how much will it cost you to do it. If you need any more help with writing a business plan then there are loads of free examples and templates online. Click here for one.
2) It doesn’t have to be perfect.
Yeah, I get it. You want everything to be perfect before you release your business to the world. I did the exact same thing when releasing my ecommerce website to the world. The problem is though that you are wasting time and you aren’t learning from your mistakes if you never actually get out there. There will always be things you can improve on in your business and website. There are things that when I started I wish I wouldn’t have done but at the time I thought it was a great idea. Don’t be afraid of failure, it’s something that you have to go through in business so that you can learn and move forward.
3) Money management.
You’ve probably already heard the terrifying statistic – that 4 out of 10 small businesses fail in their first 5 years of trading. This can be for a number of reasons, but the most common reason is down to money. One of the most important aspects of business is money management. You need to get an accountant or if you can’t afford one I would highly recommend bookkeeping software like QuickBooks. You will need to keep a very close eye on your revenue, margins and what your gross profits should be, especially if you are wanting to get an investor on board in the future.
4) Your business image.
If you’re starting an online business or any sort of ecommerce website, then this is a big deal. Don’t rush this at all, as you can’t really keep changing it. Your businesses image covers everything from the name to the branding. If you have thought of a business name, then make sure you thoroughly research online to check if it has already been used. If you come across a Facebook page that hasn’t posted in over a year, then you need to check on a website like companycheck.co.uk to see if the company is still registered. The next thing you need to do is check if your desired domain name is free. Try and get as many domains as you can that are related to your business. You will regret it in the future if someone has taken a domain name that you want just because you didn’t get round to buying it when you were starting out in business. The domain name is really important as it’s something that is going be used throughout everything you do with your business. Remember, the shorter the domain, the easier it is to remember. The next step would be to work on your logo and overall image of your brand. Make sure to use colours that match your business and make sure your logo doesn’t look like another logo. It can be a big deal if your logo even slightly looks like someone else’s. If you can’t design a logo or don’t know anyone that can then try peopleperhour.com for finding the right designer for your business.
5) Ask for help.
Even the biggest businesses in the world sometimes have to seek help. Not only is an outsiders point of view great for learning about the bad things about their business, but they also give a fresh perspective to the future of their business. When asking for help it doesn’t always have to be by finding people and asking them there and then. There are plenty of business forums online with a wide variety of entrepreneurs willing to give you a helping hand. Click here to get started.
If you haven’t researched every single part of your business, then are you purposely trying to fail? I’m being deadly serious here. Research is so important at the starting line of your business. You wouldn’t run a marathon without training for it, right? Make sure that you know everything you can possibly know about the line of business that you’re going into. Know everything about your competition and most importantly, know everything about your customers. You could know everything there is to know about your competition but you still don’t know why the customers decide to shop with them. The best bit of advice I ever received off one of my mentors is to become a customer yourself. Be careful not to spend weeks on researching as you should always be researching even when your business is launched. The market is changing all the time and you will need to keep up to date to survive.
7) Cash flow is everything.
The key to every business is cash flow. It can literally make or break your business. The thing that you need to remember is that there are so many unforeseen outgoings that you need be ready for. In my own business, we learned the hard way when it comes to cash flow. Our ways to avoid those dark days is to implement a solid back-end system. At the end of every working day, we transfer money from the day’s sales to separate accounts so that it doesn’t get soaked up in one main bank account. An example would be, say we sold something for £100, 20% goes to the VAT bank account, £3.50 goes to the postage account and 20% goes to a saving account. Not only does this kind of system help you manage your cash flow a lot better it also makes it a lot easier when it comes to accounting and paying bills.
It’s helpful if you can find wholesalers that offer accounts. This means that you can buy a certain amount of stock and you have let’s say 30 days to pay the invoice. That then gives you 30 days to sell the stock and to then pay the invoice. In some cases, a deposit might be taken and a lot of the time you will have to prove to the wholesaler that you can pay on time. It’s rare that you can ring up a wholesaler that has never dealt with you before and get offered a 30-day account. I would recommend placing a couple of small orders before asking the question. If your cash flow is super thin, then drop shipping is a great way to get started. You only pay for your stock when it sells.
8) Don’t underprice yourself.
This is such an easy hole to get into. When I started my vintage clothing company we were an affordable brand and when the business started to grow we then had more overheads that we had to add to the price of the clothing. Our customers got confused to why we weren’t as affordable as we once were. We did lose some customers and it was a very hard hole to get out of.
I know the truth is that you need to be competitive, I totally agree and if I would have come onto the market selling the exact same thing as everyone else for the same price or even worst if I was selling it for more than everyone else then it wouldn’t have done well at all. The problem you have though is getting out of that if you want to expand your business. This is why you don’t want to start off being the cheapest around unless you can keep it that cheap forever. You have to take into account that when it comes to the end of year sales too, can you really afford to join in with discount sales if you’re already cheap?
9) Be thrifty.
Having nice fancy things might be great at the start but what about when you have spent all your cash flow on the latest gadgets? Not so fancy anymore. When starting in business, always choose functionality over fancy things. Most platforms in the world offer a free trial. Adobe Photoshop, Microsoft Word, QuickBooks, Dropbox etc. Make your own business cards, look into getting refurbished computers instead of brand new ones. Save on everything you can and you will see the benefits in the future from it. If you play your cards right and buying fancy things is your thing, then you will get to do all that in the future if you get your business to set off in the right way.
10) Learn everything you can.
This is one of the most important tips on this page. If you can’t do something, then learn how to do it. Now I know you can’t learn how to do everything and sometimes it’s not always practical too. But what you can learn, learn it! In the first year of my business, I was taking over a thousand pictures every week. I put them all through Photoshop one by one, pressing random buttons and sticking with the ones that looked good. Then one night I decided to take a more in depth look into Photoshop and discovered on YouTube a video tutorial about Photoshop actions. That video changed my life, it literally saved me around 30 hours a week of editing. The fact that I could press one button and Photoshop would edit my pictures for me while I go and do something else to better my business. If I hadn’t have looked that night, then who knows how long it would have taken me to find that button.
Don’t be afraid of learning new things, you’ll be really surprised by your abilities when you know it will benefit your business.