Small business owners often dedicated the majority of their time in ensuring that their business succeeds. They nurture their business carefully with each step but unfortunately very few start up businesses make it beyond their 3rd year. Failure is usually down to a number of clearly identifiable mistakes, which if small business owners are aware of, can increase their chances of survival.
Here are the 3 common mistakes a small business owner makes.
When starting off it’s easy to decide what capital is required for what. What many new business owners forget about is the capital needed to keep the business going (your “working capital requirement”). Business owners often get excited about a large amount of cash coming in and spend it on themselves, leaving the business empty. If you want to survive make sure you set aside enough cash to meet all your needs. Being in business can be exciting, especially once the money starts to come in but don’t be tempted to immediately buy a sports car. If you are to own a successful business then you have to keep some cash back to fund future growth.
Insufficient Capital & IT
Making sure you’re making the best use of your working capital requirements and your business is a priority. We’ve previously discussed the many benefits of outsourcing your IT and server hosting and yet again, we can’t stress enough on the amounts of money a small business is able to save. Anywhere from thousands can be saved if a small business decided to outsource their IT and server hosting.
Growing Too Quickly
Although one of the more pleasant problems; growing too quickly can put you at a disadvantage. A small business shouldn’t get overly excited and must be disciplined enough to only take on work when they can handle it. If you take on more than you are able to complete, you will disappoint not only the client but also your existing ones. Administrative work also shouldn’t be underestimated as getting behind on paperwork shows that you are amateur and has a damaging effect on your business.
Growing too quickly & IT
As previously mentioned, scalability is important in every aspect of your business. Making sure you are able to cope with current and new clients is a must, as well as making sure all your operations and resources are able to accommodate for your clients needs. You can’t afford to have your servers go down due to a sudden increase in volume because you didn’t think ahead about your IT. Managed server hosting plans are the best option because resources are constantly monitored so you are notified if you are reaching your limit and should take action, avoiding any disruptions.
Trying To Do Everything
Small business owners face a problem of everything falling onto their plate. This is an inevitable part in small business ownership, especially in the beginning that can really blossom into freedom. However, with a limited budget staff are expensive and so comes a challenge with trying to save money and complete everything by yourself. Taking on an extra help will increase your costs but will save time, allowing you to do what you do best – developing your business.
Trying to do everything & IT
This again relates to trying to do your IT inhouse increasing time and cost. By placing your server hosting & IT in the hands of expertise and focusing on your core business, you are able to free yourselves of distractions and do what you do best. IT can be very time consuming especially if it’s not your area of expertise. Having to take care of your server hosting such as monitoring your hosting resources can be very time consuming. Even if IT is part of your business (eg. you own an online software company), your IT department (or person) should focus on more crucial areas of business success (eg. Software development).
Have you ever caught yourself in any of these common pitfalls?