Having your own small business has some awesome benefits. You get to be your own boss, set your own hours and have creative freedom. The world is your oyster!
But it can definitely get overwhelming at times.
Under the pressure of wanting your business to take off and succeed, some things may inevitably slip under your radar.
And while there is no one-size-fits-all business plan, here are 10 common mistakes that you could avoid to help your business run smoothly.
In the excitement of launching your business, you might find yourself rushing to get things done. You want things to keep rolling, and taking too long to think feels like a waste of time.
This might be anything from not doing enough market research, or hastily jumping into business with a vendor.
Solution: You’re allowed to take your time. This isn’t saying yes to procrastination, but rather a reminder that you can still hit your goals and to-do’s without feeling chased!
Make sure decisions are best suited to you.
2. Doing It All By Yourself
Many small businesses are a one-person operation. Props to you if this is you! In fact, you might be extremely used to doing everything yourself.
However, it doesn’t mean you have to be a jack of all trades. Keeping on top of everything gets very complicated very fast, and any mistakes you make along the way might cost you more in the long run.
Solution: You might want to consider consulting an accountant for your finances, or a lawyer to ensure that your business legals are all in check!
You might even consider getting a legal subscription service.
3. Not Choosing The Right Business Structure
In the midst of planning your business product or service, the thought of how to structure your business may not be the first thing that comes to mind.
Generally, there are three options: sole trader, partnership or company. Each has its own pros and cons! Will you be personally liable? Will you have a partner?
Solution: Choose the structure that makes the most sense for your business. It’s different for everyone! If you’re not sure, feel free to ask!
4. Jumping Into A Partnership
Doing everything alone is intimidating and having a friend, significant other, or family member as your business partner seems like the perfect solution.
It can be! However, it’s important to be mindful that personal and business relationships do not always translate. Personal and professional time division can also be quite difficult.
Solution: You and your partner should get along well (of course), but also have complementary skills that contribute to the business in ways you can’t. It’s also important to address how much your partner wants to be invested in the business.
There are several things to consider when choosing the right business partner.
5. Not Putting Agreements In Writing
Sometimes, business partners will forego putting the details of their partnership in writing. You get along so well and have known them forever — having a contract between you sounds way too serious, right?
But what happens if the business fails? Or either you or your partner eventually want to leave the business? Will you share everything 50/50? How will you divide time commitments?
If you have a company structure, you’ll want to get a Shareholders Agreement.
6. Failing to Protect Intellectual Property
Intellectual Property (IP) includes almost all the intangible things in your business. It could be your designs, brand, ideas etc. It’s the core asset of your business.
If you don’t protect it, someone else can claim a right to your IP and copy your business verbatim!
7. Hiring People Incorrectly
You’re looking to expand your business and want some employees on board. Sometimes, it’s easy to get caught up in looking for the perfect candidate and forget about the correct employment procedures.
Solution: Double check if your employment contracts are adequate. There are many aspects to consider such as pay, classification, the type of work, confidentiality, termination etc.
8. Not Separating Personal And Business Accounts
You’re just starting out and not making any profit yet, so you think: what’s the point of setting up separate bank accounts?
As a business, you want to know where every single cent is coming in from and being spent on. It will eventually get really confusing trying to separate your personal and business expenses.
Plus, tax time will eventually roll around!
Solution: You don’t have to start off with a business account if it’s too daunting. Just make sure you have a separate checking account for all your business stuff.
It might be best to hire an accountant in the long run.
Alternatively, you can use a business management platform to separate your business and personal accounts. For instance, Thriday – an all-in-one transaction and accounting platform for small businesses – allows you to open a business bank account online in minutes using your IDs and business registration details. Thriday also uses AI to automate your banking, accounting and taxes so it’s easy to stay compliant.
9. Not Using Social Media To Your Advantage
Social media is a fantastic marketing tool for all businesses. And, it’s also often free to use! Your individual circumstances will determine the best platforms for your small business.
Remember that social media can also generate additional revenue on top of your small business.
Solution: Play this to your advantage! If you don’t have a huge marketing budget, you might want to start building an online presence on the free platforms available.
10. Don’t Forget Why You Started
Having your own business will sometimes get really tough. It’s easy to get carried away with the negatives and lose sight of why you’re here in the first place.
It might be your passion, your lifelong dream or you’re just all about that hustle!
Solution: Whatever it is, business will have its ups and downs. Channeling stress productively is a life skill we can always keep on developing.
Remember to give yourself some time off and enjoy the process.
If you need any help with your small business legals you can reach us on 1800 730 617 or email email@example.com for a free, no-obligation chat about your needs!
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