Monday, August 11, 2014

3 Things New Business Owners Are Failing to See!

There is no manual for being a new business owner. You can go to business school, your family can have owned a business, or you may have held an important decision making role for a Fortune 500 company- regardless, you are still not completely prepared to be a new business owner. Why? Well, each business owner has a specific journey designed around not only his or her industry, but the approach and resources associated with their business and related to their chosen industry.

This said, there are three common areas new business owners fail to pay attention to, or “see”, when launching a new venture. The first, and biggest miss, is cash flow versus profit. Forget making a profit for the first two years. This occurrence is rare. You need to maintain a moving 10-13 weekly cashflow forecast to survive. Most new business owners fail to maintain a working cashflow and then, when an emergency happens, it isn’t there and the business folds.

New business owners have to work in general terms, not specialties. Why? Chances are you will not have the budget to hire a marketing team, writing team, sales team, graphic designer, web designer, social media account manager, etc. right off the bat. These positions will have to come with growth. Ironically, you need many of these positions to obtain growth. Thus, these hats will have to be worn by you! So, be a generalist and not a specialist!

Finally, know that you have competitors and they have established customers. It is very hard to grab a customer away from another business simply based on better pricing. There are countless studies that reflect this. Instead, people tend to change products or vendors based on improved or better features, not pricing. So, think about how your company can appeal to the competition’s clients from a features point of view. Most new business owners dive into price point wars right away, which kills their potential for growth.

Until next time,

Twyla Garrett

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