The road to creating your own business is waylaid with possible mistakes on all sides. One wrong move, one wrong partner or contract, and everything could come crashing down around you. Since you are putting your all into your business, you should pay attention to the following list of the five most common mistakes that entrepreneurs make and how to avoid them.

1. Picking the wrong partner 

Even though it may sound like a great idea to start your own business with your best friend, you have to take into consideration your friend's qualifications. The person may share the same passion for the idea that you have, but if he has no idea how to run a business or frequently mishandles his own money, you should not invest your capital or time with him to get a business off the ground. On the other hand, if you find a potential partner who has all the business skills in the world behind her but you cannot get along with her, you should avoid partnering with her as well, as confrontation will do nothing to help your business get off the ground. You need to find someone who has the best of both worlds: skills and personality.

2. Losing sight of your market 

It's true that the larger your market is, the better your sales are going to be, simply because of the law of averages. But if you try to please everybody, you are going to lose everybody. If a product is so generalized that you cannot pin down whom it should be sold to, you will not know whom to pitch to. Also, pitching to the general public takes away the sense of personal need that niche products provide. Know whom you are selling to for optimal success.

3. Not knowing how to budget

If you run out of money at any point in your business startup, that is a pretty good sign that your financial future is not too great either. A successful business owner will be laying down budgets from day one, in addition to finding ways to make money stretch. He or she will also realize that you need to always have some sort of financial cushion, because an emergency can strike at any moment. In that case, if you do not have anything to pull from, your only option could be to shut your doors.

4. Not staying in touch with your customers 

If you do not gather feedback from your customers, especially in the early phases of your business, you will not know what is working for you and what is not. If sales start to dip down and you do not know why, it could take time that you do not have to turn the ship around. Getting feedback means that you will have a pulse on your business, and will know exactly what adjustments to make to better it.

5. Getting your emotions involved 

Your emotions are obviously going to be the driving factor in your business, as the passion you have for the idea or solution is going to be why you start it in the first place. But if you get too attached to what you are doing, you will open yourself to the possibility of being blind to the changes needed to further your success or to the one idea to leave behind in pursuit of a more sustainable future.

Published on: Sep 2, 2014