Starting a business is an exciting entrepreneurial adventure, and it can be quite tempting to jump into it headfirst. But it’s not without risks and pitfalls, which are common among first-time business owners. Even with a wealth of online resources, there is much to understand in order to maximise your chances of success.
In this post, we hope to save entrepreneurs from making costly mistakes during the first year of their startup.
Pitfall #1: Failing to devise a business plan.
The first mistake to avoid is failing to devise a business plan. Most unsuccessful businesses did not devote sufficient time to defining a clear roadmap for how they intend to attain their goals, ideally over the following 12 months, and what resources they need. A business strategy should be precise, with specific goals for sales, costs, and marketing efforts, among other things.
Pitfall #2: Failing to understand cash flow.
According to the Mercer Cost of Living Index 2022, the cost of living in Singapore is the second most expensive city in Asia and the eighth most expensive in the world. It is recognised as a financial hub, making it a popular destination for digital nomads.
When it comes to your business, you cannot risk having lower finances than necessary. To generate a profit, your company’s sales must surpass its costs, which are often incurred up front and may be significant in the early stages. Sales revenues, on the other hand, may not arrive for weeks or months. You need to strategically manage your finances to compensate for this mismatch.
Pitfall #3: Failing to do market research.
Don’t cut corners on market research. Instead of launching a business purely on the assumption that there would be a demand for your product or service, spend time determining the size of your target consumer base and assessing their inclination to spend money on what you’re bringing to the table. Check to see if competitors are already addressing that need. If so, discover and capitalise on your unique selling point.
Pitfall #4: Failing to invest in marketing.
Effective marketing is critical to attracting customers to your business. Only if you utilise effective marketing would potential clients be aware of your location and what you have to offer. Promotion includes all forms of advertising as well as public relations.
Pitfall #5: Failing to ask for help.
Building a business from the ground up comes with many challenges. Things don’t always go as planned, and working alone forces you to multitask, which is never a good thing. Consult with a professional to help you navigate the murky waters of launching a new business. The last thing you want is to fail to follow through on commitments made to your customers because you’re feeling overstretched and overworked.
This article should not serve as a substitute for independent professional advice. For thorough and comprehensive advice custom-tailored to you, don’t hesitate to contact the team at Summit Planners.