CF Saskatchewan Blog

The 5 Biggest Mistakes New Entrepreneurs Make

  • January 6, 2016
  • Written by Community Futures Saskatchewan

With a new year upon us, many of us have set our sights on making 2016 our most successful business year yet! Inspired by that “fresh start” feeling that January customarily brings, many entrepreneurs are often infused with a surge of renewed motivation and are eager to hit the ground running. Sometimes however, when excitement and enthusiasm are doing the driving, strategy and solid planning can go out the window.

While mistakes are an inevitable component of starting and growing a business, many of the most common missteps that entrepreneurs make are easily avoidable. To help ensure you put your best business foot forward this year, we’ve identified the top five blunders that can trip you up.

1. Lack of Market Research

All too often, entrepreneurs can become blinded by their passion and personal bias, which can lead to disastrous results. While you may be convinced that your business idea is a brilliant and profitable one, without adequate research, objective input and hard data, you may be setting yourself up for failure.

Before you invest a great deal of time or money into your idea, it’s vital to consult with experts from the start-up community and tirelessly test your product/service idea with prospective customers. So many business owners neglect this crucial step due to perceived cost or a fear of negative feedback, but without this validation, your viability is left hanging in the balance.

2. Analysis Paralysis

On the complete flip side, business owners can spend too much time on research and planning, becoming bogged down by the minutiae and overwhelmed by the details.

Allow yourself adequate time to make important decisions and perform due diligence, but not so long that you’re missing opportunities and failing to move forward. As the motivational master Zig Ziglar has said, “You don’t have to be great to start, but you have to start to be great.”

3. Failure to Market

Unfortunately, even the most outstanding product or service will not sell itself. Many small business owners lack either the skills or the confidence to adequately promote their products and services. Yet, marketing is absolutely essential to building awareness, attracting customers and of course, generating sales.

Getting the word out about your business doesn’t have to be difficult, scary, time-consuming or expensive. There are countless cost-effective and non-slimy ways to get people talking and bring them through your doors.

For example, you could give a free talk, do a fun give-away on social media or develop a customer referral program. Taking the time to investigate (and implement!) some creative and compelling marketing tactics could be the single best thing you do for your business this year.

4. Insufficient Funding

Without sufficient financing, your business is unlikely to get off the ground or gain traction. However, determining out how much you need and where to find it can be a daunting task for many entrepreneurs. But whether you choose to bootstrap, get a business loan, crowd fund, or raise venture capital, it's critical to formulate a smart funding strategy from the beginning and see it through.

It’s often the case that budding business owners are unaware of the variety of options available to them. For instance, in addition to providing guidance and training to entrepreneurs, Community Futures offers a variety of loan products that are specifically designed for new start-ups, expansions, and launching businesses in rural communities.

5. Mediocre Customer Service

It should go without saying that good customer service is foundational to business success, yet many entrepreneurs fall down here. Too many businesses treat their customers as though they are easily replaceable, which is poor business sense, as it costs significantly more to acquire a new customer than it does to retain one.

The difference between businesses that thrive and those that merely survive is the ability to offer a remarkable customer or client experience. Exceptional customer service is about going above and beyond what is realistically expected; it’s about surprising, delighting and providing unparalleled value.

Making the effort to go the extra mile is not only smart, it’s incredibly savvy. Happy customers turn into loyal ambassadors and raving fans, which is beyond a doubt the most effective marketing strategy there is.

Looking for even more ideas and inspiration to make success? Check out our Tips & Tools page for more great resources!