Ticking the Market Research Box
This is probably the most repeated mistake, when a bank and or a county enterprise board says you have to have a solid business plan with accompanying valid, relevant and current market research, then having a business plan seems to become an obstacle not an important business aid.
Confidence beats a business plan
This is probably the most likable mistake, and one that I hear from others regularly. “My confidence is so strong that nothing will stop the launch of my new company.” Hmmmm.
Not changing when the market demands it.
When a client’s new product or service is it met with resounding … silence? It is imperative to be smart and humble enough to be able to change course when the market just isn’t responding (also known as low sales). Possibly even advise to close.
Lack of consistency in the business strategy
Some have to be reminded that they can only be successful at what they do well. It turns out that For instance, I worked with a welding company at one stage. Many of their clients asked them to come back in order to do their handyman work as well. When the we ldingcompany started doing that, they found that their high-margin welding business started to suffer. This company eventually realised that they were welders, not a handymen.
I’ve got no advice to offer you. Teaching a budding entrepreneur patience is one for the Lord himself.
Lack of funds is an odd dilemma because it seems like all have suffered from it. Can it be a real dilemma when it is the norm? Too much money can also be a bad thing and underfunding is typically only realised after the fact – particularly when business plans are not adhered to and sales targets not being met.
Can you really ever have enough money to satisfy all of your entrepreneurial fantasies? Outside the Dot-com era, I would think not. I believe that a slight lack of money, combined with superhuman drive is what defines an entrepreneur. The ability to stretch a Euro and be creative with cent is what creates successful lean businesses.
Over-projecting results and sales
Since part of being an entrepreneur is finding opportunity in everything, it’s probably no surprise that most find it easy to over-project earnings and sales. Many have fallen flat on their faces with projections.
Overconfidence usually has a client believing that the whole world wants what they have to offer. So what I ask clients to do now is to let the business plan sit for a few days, then review it again. Then I ask them to apply a very specific and highly technical formula: Take the initial projections and either cut them in half, or double them. Generally I cut my sales and rate of sales in half, and double my expenses. Now how are we doing?!
Not hiring people early enough
The value of hiring (or delegating to) the right people for the right job. This is a money-making strategy, especially when we factor in the cost of the client doing low-value work: usually production versus sales and management. If a client can pay someone €12 an hour so that they can concentrate on making sales and growing the company, it simply makes sense for them to do it.
Managing the people on my team
Most clients have also learned over the years how their style of management can ruin or accelerate a team’s skills. My job is to make sure the right skills are being transferred to the right staff. Freeing up the clients time to make more profitable decisions.