Getting through the first year of business is a massive challenge for any company. You will likely start out with at least some debt due to your overhead costs, and so getting established and turning a profit (and doing so quickly) is often key. There are lots of things that can prevent this from happening and all kinds of setbacks, so it’s crucial to know what these are so you can take steps to avoid them. Here are five failures to avoid in your first year of business.
Lack of branding
It’s your branding that sets you apart from your competitors, so having a clear brand image from the start will help you gain your own following and avoid having to compete with similar (but much bigger) companies. Branding isn’t just a logo on a product- it’s a promise to your customer. When they buy from a well-known brand, they know they’re buying good customer service, product testing, high-quality materials, and a smooth buying experience. Competition is fierce in business, and no matter what you do, you’ll have competition. However, focusing on your brand helps to differentiate you, and therefore appeal to customers that are interested in you.
Managing your security can feel daunting as a small business owner, not only do you need to protect your physical assets but you need to consider online security as well. Rinsed bank accounts, stolen data and fraud are all seriously bad news for any business, let alone when you’re just getting started and established. Use strong passwords, and utilise the cloud since your information will be securely encrypted. If you believe you may already have been hacked, look into selecting a computer forensics expert and find out what legal advice you can get as well. Criminals stealing your customer data then using it for fraud purposes can have massive implications on your business and may tarnish your reputation to the point it never recovers. So take this seriously.
Health and safety blunders
Another crucial part of your business, get this wrong and people’s lives could be at risk. If someone had an accident or is injured as a result of your business, it could be seriously bad news for you. It could be as a result of your products, or advice you’ve given. It could be a result of one of your employees falling over at work, or even someone slipping on snow outside of your premises. If you have quite a dangerous workplace, be it a factory, manufacturing plant, a lab or construction site then this will be something that’s always on your mind. Make sure that everyone has the correct training and experience needed, and health and safety training, and make sure this is followed to the letter.
Poor financial planning
Naive new entrepreneurs often make mistakes when it comes to money. From poor budgeting and overspending to their own personal debt catching up with them, there are lots of errors that can be made here which can be fatal for your company. If your daily accounting is wrong, come tax time your figures can be wrong and you could land yourself with penalties, fines, even a prison sentence. If the government believes it has been done for the purposes of avoiding tax you can be in some serious trouble. Hire an experienced accountant or outsource the work so you know that your money is being properly managed.
If you’re new to business, it’s easy to assume that if you sell good products or services that you know people want and need, then you will be a success. However, it simply isn’t the case. With so much competition out there, you need to get your name out there to the people who are going to be interested in your business. Marketing helps you to do this, with a mixture of SEO practices, blogger outreach, social media marketing and more your customers will be able to find you. Not only do you need to find the people who are interested in your business, but you also have to compete against your more established competition which can be really tricky for new businesses.