6 Mistakes Small Businesses Make and The fix Them

Avoid these common pitfalls to boost your small business success. Learn effective fixes and strategies to prevent costly mistakes and ensure growth.

Nearly half of all small businesses close up shop after five years of operations. There are a lot of reasons why businesses may go bankrupt, from marketing blunders to inefficient operations. In any case, all these businesses have one thing in common: shuttered doors.

Needless to say, entrepreneurs looking to start (or are already running) their own venture wouldn’t want to be a part of this negative statistic. Unfortunately, success isn’t always a guarantee, and entrepreneurs need to work long and smart to create growth opportunities for their enterprise.

One way to decrease the odds of making a major business failure is by learning about common mistakes and setting up operations to avoid them.

In this article, we’ll cover some common mistakes that small businesses may make during their life cycle. We’ll also give you six tips on how to steer clear from them as you continue to grow your establishment.

Let’s get right into it.

1. Failure to Create and Focus on Business Goals

Before you launch your business, you should ideally have a structured business plan with a set of goals to follow. These goals are specific to your company, but they may generally include targets such as revenue figures, customer acquisition numbers, and brand development milestones.

Running a business without goals to aim for is a financial disaster waiting to happen. You’d essentially be operating like a headless chicken and fail to direct your business towards the path of efficient growth.

The fix: To avoid this issue, create SMART goals. Smart is an acronym that means specific, measurable, achievable, realistic, and time-bound. When you build your goals around this principle, you can create a more focused strategy towards working towards it and bringing success to your business.

Ensure that you periodically review your progress towards your goals. If you happen to notice that your operations are starting to deviate from these overarching goals, realign them to meet your broader objective. This helps your business grow more systematically and steadily.

2. Running The Entire Business By Yourself

Many new business owners tend to assume control of every aspect of their business. While being hands-on helps you understand your business operations close up, you wouldn’t want to spread yourself too thin.

Juggling every business function can increase the likelihood of you making mistakes in each department. It can also detract precious time for you to scale your business and focus on big-picture goals. No matter how skilled you are, it’s simply impossible for business owners to accomplish every business task in a single workday.

The fix: Identify functions in the business that are taking up most of your time. Decide which one you can delegate and which one you should handle. As a rule of thumb, focus on your strengths and delegate your weaknesses.

For tasks to delegate, hire an assistant or outsource them to a skilled freelancer. Train them and employ a hire-fast, fire-fast mentality. This ensures that your workers are competent enough to handle the job and that you can perform tasks at a productive pace.

3. Not Using The Right Financial, Operational, and Marketing Tools

Running a business takes more than just strong leadership skills and a great offering. The right toolset elevates the business’s underlying potential as a solid competitor within the local industry.

Every business structure needs to have a robust financial, operational, and marketing workflow. These tools help improve the pace at which things get done within the business. It also helps ensure that your tasks get done accurately.

In some cases, these tools help increase the number of activities you can do due to their specific functionalities. For instance, you can gather key metrics of your customer base using the right marketing tools, making it a helpful tool for progression.

The fix: Naturally, you should consider investing in the right tools to get your business to its desired level.

Accounting software like Quickbooks helps you track, manage, and monitor your cash flow to get your finances in order.

Marketing tools like Instantly, SEMRush, and Sprout help improve visibility by supporting various marketing functions through automation and metric gathering. Project management tools like Trello can also be a big help in providing order to your operations.

Besides digital tools, you should also consider equipping your business with physical tools if you own a physical branch. For instance, you should get an EFTPOS machine to securely store and track cash inflows and outflows.

Click this link to learn how to choose one for your company.

In any case, you should always assess and upgrade your tools according to your business needs. Don’t be afraid to drop an underperforming tool or invest in one that can boost your team’s productivity to new levels.

4. Acting Too Slow

The business world is a fast-paced environment, with opportunities and problems arising in every corner. These opportunities can either be embraced with open arms and bring you a lot of wealth. Conversely, a new development may lead your business towards a downward spiral that can swallow it whole.

The fix: As a business owner, you need to constantly adapt to the constant fluxes in order to remain competitive. For instance, if a new technology has been released that can benefit your company, don’t hesitate to experiment with it and weigh its pros and cons.

Keep testing and iterating your business processes instead of waiting and watching. But of course, do it with risk assessment in mind. Flexibility is key to being successful, and even if your business is doing well today, it takes a series of bad and slow decisions to enter the negative point of no return.

5. Not Prioritising Customer Happiness

Your customer base and clientele are the key drivers of business growth. Failing to consider them and their feedback when making major business decisions can limit your business’s growth potential significantly.

Even just a few unhappy customers can harm your reputation, as they can easily spread negative word about your business to the local community or through digital spaces like Google reviews and your social media page.

The fix: To combat this, always try to collect customer feedback and work towards improving your business in line with their wants. You can gather these data points by talking to them or by hosting surveys.

You can also gather these data points by tracking and recording calls through a business number and finding patterns that may be holding you back in their eyes. From there, work on improving your internal operations to meet these desires.

For instance, you can consider reintroducing a phased-out product for a limited time due to incessant demand.

By being proactive in boosting customer satisfaction, you can improve your reputation and have them satisfied throughout the buying process, from the product to customer interaction.

6. Not Knowing Your Customer Base

If you’re unclear about your average customer’s persona, you’ll encounter great difficulty meeting their needs. Their persona goes beyond their age, gender, and background—it also looks into how they structure their daily life, their values, and their behaviour.

While it may be tempting to target anyone and everyone, your business will be much better off finding a specific subset of customers to target. This way, your marketing efforts will be more cost-effective and successful.

You’ll also be able to resonate with these customers and build a loyal base, which will benefit you for the long term.

The fix: Knowing your customer base requires you to perform extensive research on what your product or service aims to solve and who most benefits from that product. You may use surveys to take a look at the average customer profile and their buying motivation. You can also simply look and track at the type of people entering your store and extract data from there.

Once you’ve gathered a large-enough sample size, you can structure your future product lineup, your marketing campaigns, and other business strategies to resonate with the common ground audience. This way, you’ll be able to focus your efforts onto a specific target base and have a higher chance of success.