By Funding Gates
When running your small business, it is likely that you work hard to avoid mistakes like shipping the wrong product or missing deliverables. Even if you have a stellar track record with your client base, it is possible that you could still be making mistakes in how you run your business. Avoiding these common traps is important to staying on track.
1. Letting Customers Drive the Vision
Once a business starts to take off, the gut instinct of many owners is to respond to client requests and customizations in an effort to get more invoices in the door. However, going too far with this can take a company off track. Chasing the whims of customers – especially customers who aren’t going to be loyal over the long term – can result in a weaker, niche product.
When it comes to make or break business decisions, consider what your original and long-term vision is. If you lose money on one transaction in favor of supporting the security and big picture of your company, you will come out ahead. Take customer feedback for what it is – feedback, not an instruction manual. Ensure that you have multiple people on your team to review that feedback and find the best way to incorporate it.
2. Focusing Too Much on the Wrong Type of Marketing
If you’ve read small business blogs in the last two years you’ve read a lot about social media marketing. Since its inception social media marketing has been billed as both free and awesome. However, all of the big social media platforms have changed their rules on marketing and most of it is now pay for play. As with traditional marketing, business owners need to take the view of focusing in on what makes the most sense for their budget and for the impact.
Social media marketing, even paid social media marketing still remains relatively low cost compared to cutting a local TV or radio commercial. However, you need to work with agencies that have a proven record for effective social media marketing and avoid getting in with people purporting to be “gurus.” The success indicators for different marketing channels are also different from each other and specialists are important.
3. Not Watching Your Cash Flow
When businesses have a good clip of business coming in the door, marketing and administration suffer. If you only focus on profits and loss you’re missing key indicators, like overall net cash flow. Cash flow crunches are business killers and can impede your ability to rebound, market, or plan for the future.
Just because things are going well doesn’t mean you can skip out on a long-term plan. This can be difficult for small businesses because typically if you’re busy everyone is busy, but staying busy is survival.
4. Skipping the Essentials
Lots of things, like marketing but also essential tasks like expenses or extra customer service, can fall by the wayside when you get busy. Being busy and being productive are different animals. We all know you have to fill orders as they come in, but you also have to set aside time for updating that spreadsheet or sending those tweets in order to keep the trains running on time. Set manageable goals.
Business author Julien Smith advocates finishing one extra thing on your to-do list before you go to bed. Just doing one more thing can cut back on stress the next day. Make sure that one extra thing is for your business and not for your clients.
5. Failing to Understand Finances, Taxes, or the Law
If you got into your business based on a service you know, or a skill you have you can’t simultaneously ignore all the big stuff you don’t know. Hoping TurboTax will save you from an audit, or Legal Zoom will ensure you won’t get sued is a recipe for disaster. Business owners too often fail to delegate or place cost above critical services. You should be able to manage expenses, taxes, business insurance, and legal documents as a functioning business entity.
If you as an individual find these functions to be outside of your abilities, pay for experts or take a class. The old adage “ignorance of the law is no excuse,” is more than just a saying. Many community colleges and local job training offices offer a crash course in the basis of business ownership. Even if you employ an expert or two, it is helpful to get yourself that background knowledge so you can make sure your experts are telling you right from wrong.
Delegating well is critical as a business leader. Beyond staying out of legal trouble just delegating administrative or customer service tasks effectively can ensure that customers have a better experience with your brand. You can’t do it all, and you don’t have to, but you have to be willing to seek help as well.
This article was originally published on Funding Gates. Funding Gates is the world’s first