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Tips for Avoiding the Most Common Entrepreneurial Errors

Small business owners all want the same thing—to see their entrepreneurial endeavor succeed. Unfortunately, many small business owners get in the way of their own success. The below guide highlights some frequent errors entrepreneurs make that can derail their business’ progress. By educating yourself about these common errors, you can make sure you avoid them yourself.

Assuming you know it all

Many entrepreneurs start a company without a basic foundation of business knowledge. Even if you’re an expert in your niche, that doesn’t mean you know all there is to know about entrepreneurship. A business degree can give you essential skills like communication, leadership, and management. Check this online degree program for options. An online degree lets you study flexibly, so it’s easy to run a business and get your degree.

Not having a business plan

A business plan is a comprehensive overview of your business and how it will be run. Creating this document in advance can be useful, as you can come back to it when questions about your business arise. Plus, you can use it to get funding for your business. Shopify explains what elements your business plan should include, such as market research, competition analysis, product and service descriptions, and financial projections.

Picking the wrong type of legal entity

Registering your business as a formal legal entity can help protect your personal liability in case of legal issues and streamline tax filings and other paperwork. A limited liability company, LLC, is one popular option for small business owners. Instead of hiring a lawyer to register your business, consider using a more affordable online formation service. Before registering, check your state’s laws to determine what paperwork you’ll need.

Not setting a budget

Starting a business costs money. You’ll have to pay for things like commercial rent, inventory, employee salaries, and machinery and technology. Before you start, make a list of all your possible business expenses and figure out how much startup funding you’ll need. You can then create a business budget to make sure you don’t exceed costs going forward. ZoHo provides details on how to write a business budget and includes a template you can use.

Skimping on technology

Many small business owners try to cut down on tech expenses, hoping to bring down overhead costs. In fact, skimping on technology can be a big mistake. The right tech can save you time, stress, and money in the big picture, making it a worthy investment. If you’re worried about overspending, try best practices for saving on tech, such as skipping the extra add-ons and warranties and utilizing IT support.

Focusing only on private-sector clients

Most business owners automatically focus their energy on private-sector clients, whether it’s everyday consumers or other businesses. However, don’t neglect potential government clients. Government contracts can be very lucrative. Plus, if you do a good job, they can result in repeat work. If you’re new to government contracting, the National Center for Responsible Government Contracting can help educate you about the process.

Neglecting to network

Many small business owners are determined to do it all themselves and take an insular approach to their business, constantly looking inward. However, it’s important to look beyond your business’ walls. You want to network, which is a great way to meet potential clients, business partners, and employees. Follow networking best practices, like preparing an elevator pitch and always having business cards on hand.

Starting your own business is an exciting journey. However, it’s important to be smart about the potential pitfalls. From picking the right business entity to educating yourself about nontraditional clients, like government bodies, the above steps can help you avoid common mistakes and succeed as a small business owner.

Want more tips to help promote your business success? Visit the business blog.

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