5 Traps to Avoid When Starting Your Business

Re: 5 Traps to Avoid When Starting Your Business

Awesome share, this is so helpful for me and also for lots of people who want to start their business, I also want to start my real estate business, and if you have some tips or steps to start this than please share with me, I real need some important suggestions, looking forward to helpful advises.

Re: 5 Traps to Avoid When Starting Your Business

If you're thinking about starting or joining a small business in this economy, here are seven traps to avoid:

1. Don't let the economy get you down. While many workers view precarious economic conditions as a time to hunker down in their jobs and try to weather the economic storm, others see it as a window of opportunity. Starting a business in a weak economic environment can have several clear benefits: The cost of doing business can decline because suppliers and partners may be more willing to negotiate on pricing and conditions, and the opportunity cost of lost income from a traditional job may be lower. Access to capital is also improving: The Small Business Administration's Office of Advocacy reports that in mid-2010 commercial banks started easing lending conditions while levels of venture capital investments increased.

Of course, there are also precautions to starting a business in a weak economy: Discretionary spending is down, so businesses selling goods or services that appeal to budget-minded customers may have an easier time gaining new customers in this economy than sellers of full-priced luxury items. Similarly, do-it-yourself services and low-cost substitutes may fare better than full-service or premium alternatives. For example, self-service storage and organizational retailer Organize.com saw a greater than 10% increase in year-over-year sales from 2007 to 2008 and again in 2009. Explains Terry Shearer, CEO of Organize.com, "Even in a recession, people want to improve their homes, but they want to do it inexpensively. Buying good home products from a reasonably priced online retailer is a much less expensive way to improve your home than, say, hiring a construction team or designer."

2. Don't think that an idea equals a plan. Too often people start businesses with a general notion of what they want to accomplish but lack a solid, well-conceived plan. While a business plan is always important, in a tough economy, it's even more vital to think critically about your product or service, customer acquisition strategy, pricing and promotion plans, and key logistics like inventory management and fulfillment. Similarly, it's important to be very clear about your unique business angle and your differentiation from competitors.

3. Don't be an island. Though entrepreneurs tend to be well versed in a wide variety of areas, even the most skilled entrepreneur cannot expect to be an expert in every aspect of business. From IT issues like network maintenance and website development, to marketing and customer acquisition, to accounting, payroll and legal services, there's too much for most people to handle alone. Have a clear sense of your own strengths, and surround yourself with the right partners and advisors for the remaining tasks.

4. Don't expose yourself to unnecessary financial stress. Starting a business can be extremely costly, both in terms of lost income from a full-time job and in terms of capital investments — but it doesn't have to be. Don't quit your day job too soon, seek outside investors in addition to your own personal assets, and consider lower-cost options for starting your business. For example, if you're going into a retail business, make sure you consider both brick and mortar and online business models, given the considerable difference in capital requirements for each model.

5. If you build it, they may not come. Having a great idea and even a great skill and product are very useful in starting a business, but you also need to have a carefully thought-through marketing plan. Customers won't just come to you. You need to think through all of the tactics at your disposal — from newspaper and radio advertising, to online marketing, to good old-fashioned referrals — to consider how to acquire customers and then turn those customers into repeat buyers

Re: 5 Traps to Avoid When Starting Your Business

I am agree with you. Because these are very common mistake repeat by all of us when we start new business because at that time we all are on high an d never thinks about these basic things. Thanks a lots for sharing your ideas.

Re: 5 Traps to Avoid When Starting Your Business

Its nice to have such discussions.. We all get to learn so much..

Re: 5 Traps to Avoid When Starting Your Business

Though entrepreneurs tend to be well versed in a wide variety of areas, even the most skilled entrepreneur cannot expect to be an expert in every aspect of business.
_________
PPC Management
PPC Company

Re: 5 Traps to Avoid When Starting Your Business

Starting a business is exciting but always uncertain as there are so many aspects to be looked at and everything must function smoothly and without a hitch. Any small problem can grow to become a major issue in a new business, so it is important to be aware of what is going on in every area.

We are a group of people who provide all kinds of help and advice for new entrepreneurs. We believe business is really the key to a rewarding life, though obviously success does not come easy. Please check out our website for great business ideas.

Re: 5 Traps to Avoid When Starting Your Business

Great points, but I would add one more. Unfortunately most small business owners judge their success by how much they have in their pocket. They don't understand financials, therefore they:
1. Don't know what is coming in the future.
2. Can't see where there problems have arisen.
3. Don't know when or how to correct.
Their first warning is no money - and by then it is too late. Most of the "traps" you name would be seen and avoided with just the basic knowledge of financial statements. You would see undercapitalization, labor overruns, and inadequate gross profit.

Re: 5 Traps to Avoid When Starting Your Business

Now, those phases each have their challenges, but it's the in-between phases that are the most dangerous. Great tips 🙂

All the above-mentioned points are very vital when considering getting into the business world. The guidelines are pretty clear. I would easily refer an individual to follow them.

Many owners work so much "in the business" versus working "on the business" and cannot get past the soloentrepreneur stage

Trying to hire staff too early. Many professional service firms hire before they see a clear line to revenue and often have to let staff go. This is especially true in sales which takes a long time to nurture leads in the b2b space.

Traps to avoid when starting your own business:
1. Not business plan
2. Ignoring minor problems
3. Getting Your Capitalization Wrong
4. Over-solving problem
5. Fear and panic
6. Lost focus
7. Overconfidence

Following tips to follow :

1. Failing to Plan Ahead.
2. Ignoring the Small Problems. 
3. Getting Your Capitalisation Wrong. 
4. Over-Solving Problems. 
5. Not Getting the Basics Right.
6. Losing Focus.