Everyone in business makes mistakes – but you can learn from others before making them. In this feature we look at five common errors which can trip up your business, and how you can side-step them.
1. Ignoring what customers want
It may seem obvious, but without customers you won’t be in business for long. And to attract customers, you have to give them what they need.
Rather than relying on gut instinct, ask the people who count. Carry out market research. Talk to existing and potential customers about ways in which you can improve your products and services. And don’t be complacent. Your customers might be quite happy – but who says a rival won’t make them happier still? Identify key rivals and review your offerings on a regular basis to ensure you remain competitive.
2. Failing to get the right technology
Think through your IT needs. It’s important not to over-invest in hardware you’ll never use – but equally you shouldn’t get left behind. New technology standards emerge on a regular basis, and getting stuck with old or incompatible technology can be a costly mistake. Seek specialist advice before parting with your hard-earned cash – and plan how to keep your IT up and running. Most small businesses don’t have the resources to employ full-time support staff, which is why services such as BT IT Manager can make sense. IT Manager provides your business with support and advice – from planning to everyday issues – without the cost of increasing your staff levels.
3. Getting the wrong people involved
Even with the latest technology to put you in closer contact with customers, business is still about building relationships – and that means finding the right people. Consider advertising in specialist or trade publications. Find out from people who work in that area what publications they read. Word-of-mouth recommendations can help minimise your risk, and it’s cost-effective too. Follow up on references, asking questions such as, “Would you re-employ this person?”
Recruitment can be costly, and keeping staff not only provides customers with continuity but also builds team experience and retains knowledge - so hold on to your team. Money isn’t the only answer. Think about other benefits such as flexible working and consider what motivates individual employees. Ensure too that you have a regular and effective appraisal system.
It’s also important to get the right fit when it comes to attracting investment. Before you seek finance, make sure you know all about your product and your market – including hard facts and figures. Don’t be tempted to mislead investors; you’ll only store up trouble for the future. And don’t assume potential investors will know the ins and outs of your market. Through closer communication, you can ensure the interests of your business and those of your investors are aligned.
4. Uncontrolled costs
As a business grows and you take on new services, it’s easy to let costs spiral out of control. Consolidating services such as communications or energy with a single supplier will help you stay on top of outgoings, and ease your admin – leaving your accounts department free for important jobs such as chasing up payment. BT’s Business One Plan simplifies your communications by combining your broadband, landline and mobile into one easy to manage package which could also save you time, money and hassle.
5. Poor business planning
All of the above mistakes will be easier to avoid if you prepare a comprehensive business plan. This will not only help you attract investment, but it will enable you to review performance and help you identify areas of concern. Your business plan should set objectives in the short, medium and long term. Be realistic about the sales you’ll make.
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