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The 7 Most Frequent Mistakes When Starting A Business

Starting a business has never been easy . In fact, the trajectory of entrepreneurs like Jeff Bezos, Elon Musk and many other successful personalities has not been without flaws in its beginnings. Precisely, from their experiences we can extract a top seven of frequent mistakes when starting a startup or an SME . Join us in this account and take note if you are starting your own project.

1. Giving too much importance to the idea, the main mistake when starting a business

Without a doubt, launching an innovative product or service is a competitive advantage when entering such a saturated market. But many of these disruptive services or products need to evolve before they can be successful. For this reason, waiting for a complete and perfect concept of what you want to offer to emerge from your mind is not the most convenient. In this way, you would lose valuable time just knowing what to do and you would stop taking advantage of opportunities and gaining experience.

Instead, start by figuring out which audience segment you could target with your product. Investigate what needs you have and choose the one that you can satisfy with a product that is basic in principle. It may be something that already exists, but is capable of improvement. In addition, it is recommended that you apply an Agile methodology such as Lean Startup , with iterative cycles . Through this you can make continuous improvements to your offer based on the reaction of your customers. As an example, it is enough to mention the creators or administrators of successful software and applications in the market. They employ this way of working to frequently enrich these tools in order to adapt to changing user needs .

2. Focus on the product and not the customer

From the above, another frequent mistake follows: putting the focus on the product and not on the client. Many budding entrepreneurs become obsessed with surprising the market with an innovative product or service. But they do not focus their attention on whether it really satisfies the expectations and needs of consumers . If the product is good and is accepted, it is not convenient to settle for it. In these cases, many entrepreneurs neglect such basic aspects as adapting payment systems and offering a punctual delivery service. In particular, when we talk about ventures based on ecommerce, Jeff Bezos is emphatic in stating that the more attention you pay to the customer, the more flexibility and resilience of your company will increase. And he sums it up this way: “If we can keep our competition focused on us, while we stay focused on the customer, we’ll be fine in the end . ”

3. Start a business thinking only of ROI

It is obvious that one of the purposes of starting a business is to be profitable. But it shouldn’t be the only one. A successful entrepreneur with a long history and current Director of ASPgems, believes that assuming the creation of a company thinking only of ROI does not make sense. Truth be told, the future is uncertain in these times when consumer interests and market circumstances change so frequently. Instead of having expectations about profits, it is better to think in terms of the maximum loss to take. That is, when undertaking, foresees the worst possible scenario. According to Cuenca, if you are prepared to withstand and survive the most adverse situations, then develop the project.

Along these same lines, the motivation to undertake must go beyond making money. If not, you’d be doing it for the wrong reason. Think about what you are most passionate about and what might be useful to consumers . In this sense, Jeff Bezos assures that “missionaries build better products”. From his experience, he can affirm that the entrepreneurs who are truly involved with the products or services they offer are the ones who obtain the best results.

Indeed, undertaking is something hard and, in the attempt, it is most likely that you will experience complex situations. In those moments, the correct motivation will maintain your firmness and perseverance to achieve your goals.

4. Not planning, the worst thing when starting a business

What good is a great business idea if you don’t have a realistic plan to develop it? Believe it or not, many have started a business impulsively, without a business strategy . Only trusting in the innovative aspects of your proposal and also in your good luck. Some have survived and learned from their mistakes along the way. Yet other people have had to abandon their projects due to poor strategic planning. You may be a brilliant person, but business strategy is essential.

Formalize that strategy and commit to fulfilling it. It raises in it the mission and the long-term vision . Above all, formulate realistic and achievable goals.in truly reasonable time. Of course you must anticipate the worst circumstances, as Cuenca thinks. However, you should also base your plan on those factors that will not vary in the medium and short term, according to Bezos. For the creator and CEO of Amazon, it is possible to investigate and analyze the scenario in which your company will compete and estimate its evolution over time. Of course – we reiterate – being realistic, without excesses of optimism! Bezos insists that by finding these unalterable aspects, you create the elements you can count on, no matter what happens. For example, at Amazon, this factor is made up of all efforts to offer a great customer experience .

5. Not consulting anyone, or paying attention to feedback and criticism

Without a doubt, an inexperienced entrepreneur should not be ashamed to seek advice from those who know the most about business. Specifically, of those for whom they have worked and who have achieved success, however modest they may be. When it comes to entrepreneurship , it is essential to shed pride and participate as one more in startup incubators . There, you will find mentors and you should listen carefully to what they think about your project. Including criticism and advice on the aspects that you should improve. Elon Musk, the CEO of Tesla and SpaceX, advises us to be kind to those who give us negative feedback or suggest we reconsider our plans.

Once your business is established, it is essential to apply social listening . In other words, be aware of what your customers and other stakeholders think about your brand. Attending to these opinions on social networks and other channels will be valuable to know which elements of your offer and your processes need to be improved. In this way, consumers and stakeholders will feel “heard”, which will strengthen the good perception of your brand.

6. Neglecting finances or improvising with them

Perhaps you have no idea how many companies with good business proposals disappear due to neglecting their finances. Not even for lack of sales! From the beginning and forever, the company’s financial operations must be closely monitored. Furthermore, the budgetary availability must be used judiciously, dispensing with unnecessary expenses.

An objective pricing policy must be established that covers operating costs and generates a fair return. Respond promptly to suppliers and adapt the supply chain to variations in demand. In this particular, it does not make sense to accumulate an inventory that cannot be used or sold quickly. Similarly, you must plan well your investments in technology and other assets to streamline the operations of the organization.

7. Choosing the least suitable partners, collaborators and suppliers

Companies are usually formed through a partnership between two or more people. If this is your case, make sure you associate with specialized people, committed and passionate about the chosen business model . This also applies to the selection of human talent that will make up the company’s team. You must make sure that they are enthusiastic, motivated and capable of proposing ideas (although it is also your duty to provide the proper motivation).

In this regard, Elon Musk is relentless in assuring: “At SpaceX we have a strict no-asshole policy” (we reserve the literal translation of the phrase). Steve Jobs thought the same: “At Apple we don’t hire the best professionals to tell them what to do, but so that they tell us what to do” . Exaggerated or not, he considers what these characters achieved, among other things, by applying these criteria. It is logical that at the beginning you cannot hire professionals with extensive experience. But you can gauge the degree of interest that the young talents you capture in the company sector have. As well as his proactive attitude and his desire to contribute.

Also Read: Management Skills For SMEs That You Must Master

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