Of all new businesses started, one-third fail within a year and 70 percent fail within five years. According to business authorities these are the 17 most common mistakes that cause these failures.
When you work on your business plan be sure to address these concerns and make sure you deal with each one.
1. Plunging in without first testing out ideas on a small scale.
2. Under-pricing goods or services.
3. Underestimating the time it twill take to build a market.
4. Underestimating competition.
5. Starting with too little capital.
6. Starting with too much capital and being careless in its use.
7. Going into a business with little or no experience, and without first learning anything about it.
8. Borrowing money without planning just how and when to pay it back, and budgeting it accordingly.
9. Trying to do too much business with too little capital.
10. Not allowing for the setbacks and unexpected expenses that are inevitable in business.
11. Buying too much on capital.
12. Extending credit too freely to customers.
13. Expanding too rapidly.
14. Failing to keep complete and accurate records, so that the proprietor drifts into trouble without realizing it.
15. Carrying habits of personal extravagance into the business.
16. Carrying too many relatives on the payroll
17. Mistaking the freedom of being in business for oneself for liberty to work or not, whenever one feels like it.
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