Your first business: Key mistakes to avoid

The statistics are damning, but the rewards are utterly lucrative. That’s the easiest way to describe starting your business and on the plus side, more and more people are seemingly taking the plunge.

Unfortunately, becoming your own boss is so much different than working for someone else. Suddenly, you are in charge of every element of your business, when in the past you may have just had a small segment of the company’s operations to look after.

It means that small mistakes can start to consume your business and through today’s article, we will talk about how to avoid some of the most common ones.

Mistake #1 – You invest in “nice to haves”

When we talk about “nice to haves”, the list is endless. However, one of the best examples is a big, shiny office. Sure, this might feel great to be part of, but at this stage of your business it’s rarely necessary.

Sure, you might have found the best place to open your business, but you don’t need to find the biggest premises in town. Try and live as much within your means as possible at this stage – there is plenty of time to buy or rent the luxuries once you are established.

Mistake #2 – You hire too early

This next mistake is very similar to the previous one. A lot of people fall into the trap of hiring their first employee as a matter of urgency.

Sure, there are some cases where this is vindicated, and if you happen to have some funding behind you there’s every chance that you fall into this category. On the most part, it’s a responsibility that you just don’t need though. Suddenly, you have committed to pay a salary each and every month and for a new business, this is a huge step to take.

Mistake #3 – You price yourself too low

In a bid to grab as many customers as possible during the early days, this next mistake shouldn’t come as a surprise. However, you simply must resist the urge to lower your pricing structure to ridiculous levels.

Granted, the customers might come in, but it’s at a cost. You’ll find that it’s very hard to move to your “real” level of pricing, and you have done yourself and your company a major disservice.

Instead, price yourself fairly, and rely on proper marketing to get customers through the door.

Mistake #4 – You forget about tax

We’ve used the word “forget”, but for many people this can just be about “ignoring” tax matters.

You have now moved into a time where your boss isn’t doing the tax legwork for you. At the end of the year you will be greeted with a tax bill – and it will be up to you to settle it. In other words, make sure you put enough money aside each month to cover the inevitable bill, and don’t fall into the trap that many find themselves in where they have the authorities chasing them at every opportunity.

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