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  • 25 December 2014
  • Eric Michaels

Get out of your own way: 7 mistakes small business owners make

If you could only choose a single phrase to describe the history of small businesses, "mistakes were made" might be the most appropriate. Entrepreneurs have made blunders in every aspect of launching and growing a company, but that doesn't mean you have to repeat them. Here are seven common missteps to avoid:

1. High prices

Starting a business is incredibly costly, and there's no guarantee you'll ever recover the money you initially invest in your company. Although you may be tempted to price your products aggressively in order to offset the large amounts you've already spent, you cannot expect to get 100% value for your products or services immediately. Smart, more modest initial pricing gives you the opportunity to build a clientele at the expense of early profits.

No successful business ever grew without a strong team.

Facebook's story is a textbook example of why focusing on growth in market share is a better strategy than focusing on profits early in your company's life. As a new entry in an established market, you should take the time to present your brand's advantages. The easiest way to do this is by offering competitive (read: lower) prices and then, once consumers are convinced, you can begin to charge more.

2. Ignoring the need to delegate

Small business owners often fall into the trap of working 24/7 without taking a break. Though this effort may be heroic, it doesn't bode well for your business. Get in the habit of delegating smaller tasks (e.g., mailings, phone calls, and emails) to staff members. Outsourcing accounting and marketing work is another smart move, particularly if you lack the resources necessary to hire employees dedicated to these tasks. You might think you are saving money by keeping these services in-house when in fact, the exact opposite could be true.

3. Hiring the wrong people

Without people you can trust, you cannot delegate busy work or larger responsibilities as your company grows. So if that means hiring your first staff members on a trial basis or working with freelancers until you find the right fit, so be it. No successful business ever grew without a strong team.

4. Losing the tech game

Among the biggest mistakes older entrepreneurs make is deciding that technology is unimportant. The truth is, you may not need a Twitter account to launch a successful business, but your company might need one if it wants to remain relevant. The same could be said for your company's website, email marketing, and digital file storage.

5. Expecting all your marketing to be free

Posting on Twitter and Facebook cost you nothing. Unfortunately, reaching a wide audience on these social networks often does. Finding success in email marketing and other online advertising efforts sometimes depends on how much you spend. For example, social media promotion is something you can begin on your own, but you may have limited ability to reach a large portions of your relevant markets without the help of paid marketing professionals.

6. Working without a target audience in mind

In an effort to build and manage their online presence, small business owners have a tendency to focus on the cosmetic appearance of their business rather than making sure they appeal to their target market. This error can lead to a website without a clear purpose, audience, or reason to exist. Launching a website before acquiring the proper research data is a gaffe entrepreneurs can't afford to make, so delaying your website's debut is better than going live unprepared.

7. Forgetting about protection

Everyone knows that riding in a car without a seat belt is dangerous. The same principle applies to small business owners. Whether you need a patent for an original design, a trademark for an idea, or a social media manager to protect you against potential online firestorms, safeguarding your business is essential.

Making mistakes is a part of every entrepreneur's experience. But before committing one of these common blunders, arm yourself with a small business owner's greatest defense: knowledge.

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