Business Startup Pitfalls!

So you want to start a business and need some practical advice huh? You came to the right place! Here are a few things you want to avoid when embarking into the world of entrepreneurship: 

Having Your Head in the Clouds

When you think of opening your own business do you dream of sleeping late, money rolling in, vacationing when you want to and no one telling you what to do? Mmmm… hmmm.  Now wake up! Owning a business is hard work…. Let that sink in. It’s hard work, early mornings, late nights, less vacations and many a day the money may be a figment of your imagination. That’s why I advise clients to create a business from something they are passionate about… you will need to tap into that love on the bad days.  Successful businesses are not instantly created - the hard work will pay off in the long run, but you will have to stick it out!

Not Enough Planning

You do need a business plan, albeit you don’t necessarily need a 40 pager to get started if you are funding the business yourself. But you do need a WRITTEN plan of how you will run your business, how you will pay for it and how you will tell the world about your business.  For a new business that isn’t looking for outside funding I would suggest at least 1 – 2 pages detailing each of the following:

Financials – Startup costs, a 3 – 5 year forecast and cash flow planning.  Create a realistic schedule of how many products you will sell or how many clients will you see as a new business.

Marketing – Don't depend solely on free Social Media avenues to market your product or service. What will you do to spread the word and how much will you allot for your marketing budget? Yes, you need a marketing budget… not just in name, but also funded.

Processes – What happens in your operations from the time a customer/client contacts you to the delivery of product or service? How will you create, manufacture, deliver your product?

Too Much Planning

You’ve read the books, gone to the seminars, taken the notes, written and re-written the plan– now it’s time to MOVE!  Elbow grease time - develop a timeline and put the PLAN TO WORK!

Going It Alone

You may start out as a one man band, but you don't want to stay that way. Have a plan for hiring staff or outsourcing services needed to run your business?

Also line up a board of advisors. Who will help you ‘see’ what’s going on your business when you can’t? You need objective voices that aren’t involved in the day to day operations to give you sound advice.

Then there are your paid professional advisors. Yes, money may be tight initially – especially if you bootstrap in the beginning, but  you will need at the minimum an accountant, attorney, bookkeeper and assistant.

Skipping the Number Crunching

Ahh yes.. you knew the Money Lady was going to park here a minute.  The math is important – don’t just leave it up to your accountant - know how to read/evaluate your financial statements. Know how to enter transactions into your accounting software. Better yet – how are your personal finances? You may  will have to tap into your personal money to fund your business, if there’s nothing there you are going to be in trouble.  Begin to develop a plan in your personal finances for tracking and budgeting so that you always know what you have and how much you can allocate to your business.

- Dorethia
www.connercoaching.com