Entrepreneurs either fail because they lack the methods, systems and controls for their business model, or they lack to ambition to go entirely in on their project.
Sometimes avoiding the wrong decision is just as important as choosing the right path.
Poor Planning
All of the ambition and care in the world is only as good as the plan to implement it. Hall of Fame UCLA basketball coach John Wooden said, “Failing to plan is planning to fail” is certainly on point for entrepreneurs. With the speed of today’s market, it’s more important now than ever that your business model is mapped out and ready to commit to a fast-paced market.
Create a Business Plan That is System-Dependent Rather Than People-Dependent
Most entrepreneurs begin their business because of a skill they have to produce a product or service. However, it’s not their lack of expertise in creating a product or delivering a service that causes businesses to fail. Rather, it’s the lack of systems to manage and run the business that becomes the weak link for the business owner.
Does the business have a cash management system that can accurately predict the cash needs of the business 13 weeks into the future so there is time to plan for unexpected shortfalls in cash flow to meet all financial obligations?
Does the business owner have a modern management dashboard which allows him to see all the critical variables and business metrics to make informed decisions based on the numbers rather than simply relying on his gut feel for what he should do?
Being Too Rigid with a Business Model
Flexibility might be just as important as planning out your initial designs for launching your entrepreneurial project. The speed of the business world means not only ensuring that you have a solid vision of what you are trying to accomplish with your small business, but you need to be able to adapt depending on the product or service that you are trying to provide.
This can vary extensively depending on your business model. Maybe your service would be better for your customer by operating outside of a brick-and-mortar setting.
You might want to consider moving your culinary dreams to a food truck instead of a permanent location. Your consulting firm might be better served by going entirely remote. Maybe your employee pool could shrink or grow depending on operational cost and demand for your product/service.
The point is to never get too rigid in your business planning. Always be ready to flow like water around any potential obstacles in your entrepreneurial endeavors.
Sloppy Financial Records
No matter how much you love your business, it can’t get anywhere without proper funding. Either carefully handling your accounting in-house or outsourcing it to a third-party firm can save business owners a mountain of headaches down the road.
This is important for both tax purposes along with making sure that your financial situation is above board when trying to finance or sell your small business.
It can be easy to forget about monetary details while you try to grow your empire, but many entrepreneurs have found themselves in a mess of paperwork after years of neglecting their monetary records.
Failure to Track Customer Behavior
Tracking customer trends is vital to your ability to meet demands no matter your small business’s goal. Buyers are flocking to social media and the digital marketplace no more than ever. There are very few industries that would not benefit from establishing a digital footprint.
Modern society has reached a point where even elderly clients are constantly engaging in e-commerce, so taking to social media is no longer the cutting-edge form of engagement it once was. Stay on top of the customer trends in your industry to make sure that your marketing strategy is never losing ground.
There are just as many ways to plan a successful business as there are to launch a model that is destined to fail. As the business owner, you have the most power over how your ambitions play out. This can be intimidating, but it can also be very empowering.
No matter what aspect of your business you want to improve or what pitfall you want to avoid Corporate Business Solutions is ready to help you at any time!