Vesta Digital Blog

How to Avoid Costly Business Mistakes

Posted on: November 15, 2010

business decisionsEveryone who starts their own business has made mistakes. There is absolutely no better way to learn. The more mistakes you make, the more you improve as a business owner and more importantly, as a person. Many small business owners make similar mistakes, so here are some ways to avoid making bad decisions that can cost you an unnecessary amount of time and money.

These tips are based off of Steve Pavlina’s “10 Stupid Mistake Made by the Newly Self-Employed.”

1. Sell to the right people

Try to sell to people who would actually use your product. While it may be exciting and you might want to push your product or service on anyone and everyone you talk to, avoid annoying friends, relatives, and new acquaintances. Don’t sell to people who simply do not need what you’re offering.

2. Don’t spend too much money

This is common sense really. Until you have steady cash flow, don’t spend your startup cash unless it’s an absolute dire necessity. “Your business should put cash into your pocket, so before you ‘invest’ money into it, be clear on how you’re going to pull that cash back out again,” Pavlin says.

3. Don’t spend to little money

I’m not contradicting myself when I say don’t spend too little money either. There is a balance between cautious, conscious spending, and frugality to the point where it interferes with your level of efficiency. Get your money’s worth when it comes to long-term purchases, like your business website.

4. Be real

Please avoid putting on a fake front. Number one, people can see right through it. Number two, it will earn you a poor reputation almost immediately. If you are running your business by yourself, don’t refer to yourself as “we.” When people ask about your business and product, you need to be honest. You should be charging prices that honestly reflect their value.

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