10 Perfect Ways to Destroy an otherwise Potentially Good Business
I'm no Letterman, and the following are not intentionally humorous. I could give you a list of 100, but here are my top 10.
10. Believing that it is easier to make money with Multi-Level Marketing than other small business options. Multi-level, whether it is an establish brand like Amway, or a brand new offering like Scentsy, requires tons of work to turn them into businesses. Finding, motivating, and managing part-time workers is like herding cats.
9. Believing you will get rich easy with any scheme, but especially affiliate marketing. If anyone says they want to sell you the secret to a get rich scheme, ask them why they aren't so rich that they could care less about selling it to others. Most of the online efforts to help you become a great affiliate marketing are just making their income selling you the method.
8. Starting or buying a business that you know nothing about. Many, many people buy or start businesses that they have no education, experience, or even passion about. Odds of success are pitiful.
7. Thinking your product or service is so great or in demand that you don't need to market or sell. If you have Gold at $10 an ounce, you still have to put up a sign.
6. Having one customer represent more than 20% of your revenue or profits. When you allow a client to dominate (think especially WalMart, Target, CVS), they own you. This is also true for the $1,000,000 wholesaler or manufacturer selling to a major account. If they switch horses or go out of business, you are toast. If they stay with you, they dictate the terms.
5. Believing that you can undercut your competitors who are gouging consumers. Many enter business because they are on a mission to help consumers whom they believe are being ripped off by the rapacious businesses they will compete with. Margins are what they are for a reason. The market is very good at driving overprices to reasonable pricing and underpricers out of business.
4. Failing to stay on top of trends in your industry. Famous statement - There is only a small difference between a goods business and a museum. Book retailing was a great business not so long ago. Not to mention newspapers, magazines, cameras, GPS devices, ad infinitum.
3. Offering open credit terms without adequate research and a great collection plan or without adequate cash flow to finance the accounts receivable. So many cases where otherwise great businesses give easy credit and end up broke.
2. No business plan. Maybe one person in a hundred is able to run a business from the seat of their pants. Why take the chance. Spend 48 hours of your life writing up a plan. That time could be the difference in success and failure. Don't have 48 hours. Pay someone $3000 to do it for you.
1. Clearly the biggest one. Entering business without full support of spouse, or with inadequate understanding by spouse of sacrifices that may have to be made in time, energy, stress, and money.
Your business and your marriage will suffer, and the suffering of each will impact the other.