20 Mar 5 things not to do when starting your own business
Starting your own business can be one of the most terrifying, exhilarating, time-consuming and obsessive things you can ever do.
While there are so many things you will be doing right, there are some important things you should NOT do when you’re starting your own business. Seasoned entrepreneurs are almost united in their opinion of what these are, and we have created a list of five things you should not do when you are working to set up your own business.
1. Underestimating the hard work required
While it’s fine to have an amazing idea and the funds to execute it, there is no way any first time entrepreneur can understand the level of commitment needed to launch a business.
There will be no such thing as weekends, or even a day off. No such thing as work hours – every hour you’re awake, you’ll be working and even when you’re asleep, you’ll be dreaming of or be haunted by your business idea.
There will also be no such thing as work / personal life balance. When you’re starting out, there is no personal life, and family and friends should be prepared for that.
2. Not having a business plan
While this is one of the most obvious first-steps to starting up a business, it is surprising just how few newbies really have one. The idea they have is that it’s ok to have a generalized plan, goal or objective without being specific. It really cannot be emphasized enough to them that this is a surefire way to set up for failure.
3. Skimping on lawyers and accountants
There is no other way of saying this. EVERYTHING needs to be written down, and formalized so there are no nasty legal surprises waiting for you down the road. Hire a good lawyer, and get formal with investors, employees, and any other stakeholders from all aspects of your business.
Secondly, while there are great online tools for financial management, there is no way a layman or even someone with bare-bones knowledge of finance can manage the accounting needed for a start-up. Our advice? Hire a good accountant so all numbers are clear.
4. Not having a cash fallback
ALL start-ups go over-budget. Fact. One thing to not do when you’re starting your own business is not have a cash reserve. Start-up costs can spillover, revenue generation can get delayed, any number of things can happen. It is crucial to have cash to fall back upon if matters come to that.
5. Ignoring the competition
Yes, we know you’ve thought about and studied your competitors, but have you considered just how far they’ll go to cut you out? Just because you’re honorable, the competition doesn’t need to be. Be prepared for someone to play right down and dirty to remove you from the industry. However, if a competitor does do that, you can be certain that you’re doing something right, and that something right has your competition scared.
So there you have, five things not to do when starting your business. There will be many other things apart from these five, and you’ll learn with trial and error. The most important thing is to learn from the vast pool of entrepreneurs who are willing to share their experiences, and put in your very best effort!