Over 90 per cent of new businesses often fail in their first three years of operations and many may fail due to premature scaling. The few that make it to maturity stage do so by avoiding or learning from common mistake that others make.
Here are a few of the mistakes start-ups make and how you can avoid them.
Business plan is probably the most important document you must prepare when starting a new business. It entails what your business is about, who the target market is and how much profit it can make in its first year. Quite bad many did not attach enough importance to their business, they never go back to read it after the first time. The document should be updated on regular basis.
Ignoring profits over revenue growth
Some start-ups lays more importance on revenue, subscriber growth over profit. While these are important factors venture capitalists look out for when deciding to fund a business, it is also important to have one eye on profitability without actually making profits.
Lacking focus and direction
Businesses that fail don’t get their priorities right, a new business owner must clearly decide what their priorities and objectives are and how they intend to achieve it.
Having a poor distribution network
Every business needs a very organized and accurate channel to market its products or services. Start-ups that fail to realise this often fail to gain any market share and often fail with time. As a business owner Once you identify your target market next up is to figure out how to get to them.
Source: The Punch