I´m always interested in reading news and magazine articles that revolve around giving tips to new business owners. Today I was scanning through some articles on CNN and found one that talked about the five biggest mistakes that new business owners make when starting out.
The first tip I´ve read about time and time again: being undercapitalized from the beginning. The same thing was said in the book I read by Maxine Clark, owner of Build A Bear. Don´t go in with access to too little money or you are doomed to fail. Think about the costs involved in opening your business. Include little costs, too, such as supplies and incidentals. Write these into your business plan and make sure that you have more than enough money to cover the costs of any "surprises´. I think I stated in a previous post that when I first wrote my business plan, I had forgotten to include in it the need for advertising money, which will be one of my largest costs in the beginning.
Which leads us to another tip: underestimating the importance of sales. Much of your attention in the beginning should go to sales and revenue. Expenses take care of themselves as sales grow, so concentrate on this area. How can you increase your sales? How can you attract new customers? What can you do to ensure that once you have customers they will become repeat customers, or they will at least spread your name in a positive light after they have used your service or bought your product? You have to get your name out there to get the people in, and so this should be included in your sales efforts.
The article also discussed the idea of not losing focus, which is why it is so important to write a business plan. You want to know where you are going and what you have to do to get there. As Joena, owner of Silk ´n Shea, said in a previous blog post (http://www.allbusiness.com/blog/WorkingMothers/11535/005471.html), you should even go back and check that plan each month to see where you stand and to make revisions as needed.
You can read the rest of the tips at http://money.cnn.com/2006/05/08/smbusiness/five_mistakes/index.htm.