It’s estimated that over 627,000 new businesses open their doors every year. And with those new beginnings come many visions realized, milestones reached, and successes celebrated.
Every up has its down though, as many entrepreneurs can attest to. Embracing failure in business, after all, can be a good thing — it makes way for personal and professional growth. But with that being said, there are some missteps you don’t have to make yourself in order to learn from them.
Here are six business owner mistakes that are completely avoidable.
Not Monitoring Cash Flow
If numbers aren’t your jam, managing the financials of your business probably won’t top your want-to-do list. But that doesn’t make it any less important.
In fact, not paying attention to your business’ holistic financial health is one of the easiest ways to put yourself out of business. This means you need to monitor cash flowand profit. Profit may be the big shiny end number — but cash flow is what you plan growth around, representing what you actually have available to spend at any given point in time.
Running Solo for Too Long
You can only wear so many hats for so long before growth reaches a standstill. And while it might be hard to let go of control over certain areas of your business, needing to do so should be a sign of achievement.
Hiring a virtual assistant or your first full-time employee is a great way to make room in your schedule for high-level planning and selling. Additionally, it serves as a stepping stone in developing your skills as a leader and operational processes that’ll make your team more efficient as it grows.
Acting Without a Plan
Every new business needs clear objectives to guide your actions and help in gauging success. If you’re acting without a clear vision for where you want your business to end up, you might as well be stumbling through the dark.
Take time, in the beginning, to write up a solid business plan. Better yet, consult with fellow entrepreneurs and mentors as you do — using their advice for the sake of setting goals that are both realistic and attainable.
Keeping Personal Finances Intertwined with Your Business
It may not be convenient to separate personal finances from those of your business but it’s worth it. Because the more intertwined they are, the more difficult it becomes to readily draw up financial reports, track expenses, and plan around incoming revenue.
Removing the blurred lines also makes it easier for you to establish a psychological separation between the two. You become more inclined to spend business dollars based on strategy over impulse.
Underestimating the Value of a Break
Time is money and just like money, it’s not always about how much you have but how you spend it that truly matters. In fact, there are scientific studies that show working less can actually make you more productive.
You don’t have to work around the clock to achieve success. Simply manage your time better. Also, leave room for vacation — your sanity will thank you for the time off.
Making Poor Hiring Decisions
When you need bodies in chairs to get the work done now, it’s easy to lose sight of how important a solid foundation can be for long-term growth. If you cut corners when hiring that first employee, you’ll get exactly what you bargained for. And more often than not, will find yourself right back where you started as a party of one.