4 Mistakes Every Startup Should Avoid
 Terry M. Blair

As a new business owner, you can make an infinite number of mistakes. No one has ever started a business perfectly. So expect to make mistakes and, if you’re smart, to learn from them.

But the more mistakes you can avoid, the blacker your bottom line, and the rosier your future.

Here are four major startup mistakes, and ideas you can use to avoid them.

Mistake Number 1: Don’t have a plan
It can be exciting to embark on an adventure with no idea of what is in store.

But when that adventure is a business venture and when your money is at stake, it’s simply foolish to begin without knowing:

• Where you are going

• What you hope to accomplish

• How you are going to get there

Those are the essential elements of a business plan. Incredibly, many startup businesses plunge right ahead without ever drafting one. Don’t make that mistake.

Mistake Number 2: Be unprepared
The two most trying circumstances for a startup business are failure and success. Be prepared for either.

Most startup entrepreneurs have sense enough to know that they may have to underwrite their new venture for months, even years, before it becomes profitable. Have cash enough to meet your bills and expenses, or your business will die.

Few startup entrepreneurs have foresight enough to know that early booming success can also kill a business. Be able to meet astounding, unexpected demand for what you sell. There’s one sure way to drive away future business, and that’s not being able to satisfy buyers when they first encounter your products or services. Can you fill that order? Can you deliver on your promise? Make certain beforehand.

Mistake Number 3: Don’t have a clue what customers want
If you think this isn’t a business killer, ask your banker. The last thing a financier wants to hear from a new business owner is, “Everyone needs what I sell.”

That type of naivety is a sure sign that:

• Advertisements will be bought to reach people who are uninterested

• Direct mail will be paid for that ends up in wastebaskets

• Merchandize will collect dust on the shelves

• And a host of other catastrophic money-losing results

Even if “everyone” does need what you sell (water, air, food, clothing) not everyone needs your particular variety of it (bottled water, air purifiers, chocolate chip cookies, bikinis). Bikini sales have never been strong in Alaska. If you don’t know what your customers want, you risk draining your budget chasing after people who have no interest in your products or services.

Mistake Number 4: Suffer analysis paralysis
There is planning, and there is too much planning. It is one thing to have researched the market for your product, analyzed the competition, projected revenues and market share and budgeted expenses down to the penny. It is an entirely different thing to obsess on these essentials to the point that you can’t pull the trigger.

Temper business planning with common sense, and yes, even a touch of adventurous spirit. No venture is certain. No outcome guaranteed. After you have crunched the numbers, don’t be afraid to act on them. Any surprises – and there will be surprises – can be adjusted for as you experience them.

Don’t let fear of imperfection prevent you from blazing a trail in the business wilderness. Be forearmed and forewarned for sure, but also be bold. Entrepreneurs are not timid and must not be paralyzed by fear of imperfection. Leave perfection to business theorists. Get out there and make some imperfect profits.

(Posted June 2005)

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