6 Common Mistakes Made By New Start-ups
Thanks to several initiatives implemented by the government, starting a business in Singapore is a relatively easy affair. However, maintaining one is a different matter altogether.
The first year of running a new business is usually the hardest as entrepreneurs are still trying to find their feet. Even the most cautious or knowledgeable will stumble during this juncture.
So before you take your first step into business, take note of the following six frequently-made mistakes and advice on how you can avoid them.
1. Enthusiasm without a plan
While having passion for one’s business is important, ensuring it will still be around in the long run requires more than just that. Take the time to evaluate the market and plan a proper business model before you embark on your start-up. It’s no use just having energy when it isn’t optimally utilised.
2. Starting a business for fun
Some entrepreneurs go into business because it seems like a glamorous thing. Others do it to experience the thrill of running a business. But they get bored soon after and lose interest. Ask yourself what your reasons are for starting a business. If you lack the passion or the willingness to make it work, you may want to re-consider your decision.
3. No idea about marketing
Having a good business plan but no clue as to how to market your company is a sure route to failure. Marketing should be an integral part of your business plan, and your expenditure on it should reflect that too. A good first step is to do some research to identify the best methods to promote your business.
4. Spending too much too fast
Underestimating the cost of overheads is a common mistake among start-ups. This leads to more expenditure than initially budgeted and may cause future financial issues. It’s important to learn how to manage risk and budget carefully. Having a cash buffer for any unexpected expenditure is also a good idea. It’s always better to overestimate than underestimate your business costs.
5. Not planning for cash flow problems
The only certainty in business is uncertainty. If this uncertainty affects your cash flow, like when business is slow or clients or customers are late in paying you, things might get rough. To avoid any problems, have plans to deal with such emergencies. Possible solutions include setting aside cash for such events, or having a back-up loan facility option with a bank.
6. Advertising only when you need customers
The most successful companies know that advertising is an ongoing activity, whether business is good or bad. In fact, you should advertise even more when business is good to capitalise on the good times.