Starting a business is extremely exciting; however, every coin has two sides. Your business idea, strategies, team and various other variables matter quite a lot in reaching the heights that you have envisioned for your venture.
What most new entrepreneurs don’t consider are the wrong, uninformed decisions that they might be taking, which will eventually result in their downfall. Starting a business is not as challenging as sustaining it is, in this highly competitive industry, especially with a lack of ample resources, like capital investment, powerful team and technical expertise. Read ahead to learn about the typical mistakes that most startups absolutely need to avoid:
- Being a one-man show
You may have started your venture alone, but expecting success without a strong team is a little dreamy. You need a set of individuals who specialise in different aspects related to your business to complement each other, and together push your business to new limits. Apart from increasing your chances of success, building a strong team will help your fellow Nigerians to get employment and showcase their skills to the world. The unemployment rate has increased from 13.9% to 14.2% in 2016. This has a direct impact on the economic conditions of the area, so it is advisable to gather like-minded people, who can help your business achieve its goals.
- Not setting goals or not keeping a check on them
You need to set tangible goals for your startup to make sure that you know if you are moving in the right direction or not. Setting goals is not the only task that you have at hand; you also have to keep a regular check on your strategies and results to identify your weak points and improve them to achieve what you have envisioned.
- Poor financial management
Having too small margins, overspending and underspending are the three most common financial mistakes that new entrepreneurs make. Financial management is one of the essential tasks that every business needs to take special care of. If you have taken loans from commercial avenues, friends and family or invested your own savings, then you need to make sure that the recovery should be on time. Too small margins will reduce your overall profits, which will affect your survival in the industry; overspending will leave you with less cash than required, which will prevent you from spending on necessary processes, and underspending will lower the impact of your strategies or degrade the quality of your products and services due to lack of sufficient money. You have to find the right balance in your business processes to ensure high-profit margins. “Money attracts money”, never forget this statement.
- Inefficient marketing and sales strategies
As already mentioned above, every industry is facing high competition due to the exponential increase of startups around the world. If your marketing and sales strategies are not up-to-the-mark, then you are in great trouble, my friend. Not being able to reach your target customers and convince them to make a purchase will lead your venture into the ground. You have to set tangible goals for these strategies as well to recognise the areas that need improvement. You have to make a sale regularly to sustain in the industry!
- Being overconfident
How many direct competitors do you have? How are you different from your competition? What is your strategy to beat the competition? If you are overconfident about your competition, then your downfall is inevitable. You should never underestimate your opponent if you want to beat them. Always remember the following statement,
“I never underestimate my opponent, but I never underestimate my talents.”
- Hale Irwin
He has summarised the right approach in simple terms, and you should follow it heartily.
- Cheap employment
There may be cheap employment available in your area, but do you know why hiring them will the worst decision that you will take for your startup? If the candidates are not asking for much, then it usually means that they are not technically sound to handle the job well. Their lack of technical expertise and experience will never let your business fly off the ground. It will also downgrade the economic conditions of your area, which will indirectly affect your sales severely.
- Not having a customer-centric approach
Yes, your product is your baby, but you cannot put it before your customers. As Kerry Strokes has rightly said, “The most important adage and the only adage is, the customer comes first, whatever the business, the customer comes first.” If your customers feel undervalued, then they will not be loyal to your brand. Your business approach needs to be customer-centric to make sure that not only are they attracted to your products and services but are also loyal to your brand, i.e. not move on to your competitors.
Nigeria is a beautiful country that encourages and accepts all types of businesses; however, due to the high poverty levels in most of the country, it is advisable to keep your products and services affordable to the people.
Know your target customers thoroughly before you launch anything in the market.
