New small businesses can not afford to make costly mistakes, which in addition to losing money could jeopardize customer relations and harm your product brand beyond repair.
It is far better, to keep reading and learn about the most common, and disastrous mistakes, that most new entrepreneurs make and what you should do instead.
Doing Everything Yourself and Not Delegating
Sure as your business’s leader you need to train and inspire your team, but that does not mean you need to do every single thing yourself.
While in your early startup stages you probably will wear many hats and do many tasks from accounting to cleaning the bathroom. But as your company grows you need to bring on new employees who can take over these functions.
In order to succeed with these new hires, you must learn how to both lead and manage people. Otherwise, these new hires will prove to be a drain on your time and resources.
Not Using Your Failures as Valuable Lessons
Every startup has failures along the road to success. Use each of those failures, no matter how disheartening, as an opportunity to learn, grow and modify your business plan for future success.
Too many beginning entrepreneurs are paralyzed by fear of failure and thus don’t experiment and dare to try new methods in sales, marketing and operations. This level of daring is necessary to achieve innovation in your company. So lose your fear of failure and instead embrace it as a detour on your road to success.
Not Protecting Your Personal Assets from Business Debts
Many business owners I have met regret, often too late, of not setting up a business entity such as an LLC (Limited Liability Company) to separate and protect their personal assets from their business property.
Without this legal business structure in place, all of your personal assets, including your family home, are at risk for business collections, debts, and lawsuits. Instead early in your startup set up an LLC, use this promo code for Legalzoom, and get peace of mind that your assets are safe from the risk of business liabilities.
Neglecting to Put Agreements in Writing
Handshake deals are easy to make but hard to enforce if you have a disagreement with a supplier, employee, partner or customer later on.
Having a well-written, legally binding contract detailing your agreement and each parties responsibilities saves you from misunderstandings and expensive court cases in the future.
As a fast-growing company, it can be tempting to ignore these legalities because you think they slow your progress. But they do not. In fact, they always save money and often save time because clarifying both parties understandings move projects forward more quickly and on track.
Risking Your Intellectual Property
You have created a unique product brand and worked hard to build its success.
Thus it is vital that you protect those non-physical assets like your company name, brand, logo design and product design with legal instruments. Dependent upon the type of intellectual property that you want to protect you many need either a patent, trademark or copyright.
Know that in today’s ultra-competitive marketplace intellectual property theft is growing rapidly. Don’t wait until someone else copies your brand or knocks off your product, be proactive and get the proper protection in place at the start of your launch.
Not Asking for Help from Professionals
Just as preventative maintenance is good for your health, getting expert advice from lawyers, accountants, and tax professionals upfront will improve the health and longevity of your new firm.
Consult with professionals about possible legal and tax issues to build strength into the foundation of your new company. These professionals will recommend important steps such as how to set up the right tax structure for your particular situation and the laws regarding hiring employees in your state.
Heed this advice from a business consultant who has witnessed far too many small business failures that could have been avoided with a bit of knowledge and upfront action. Good luck entrepreneurs.