I opended up the topic of small business around here. When it comes to starting a side business, we all face similar issues. Do I go as lean as possible or do I spend some money today to invest for tomorrow? Should I go to that conference next month or should I save up for a new printer? No matter which way your decision goes, today I wanted to look at some profit/money killers affecting small business:
From business cards to high tech laser printers. There are many financial mistakes that will hinder the growth of your side business. I remember listening to a Seth Godin interview a ways back when he brought up how he used the corner print shop for the longest time. This really hit me. We all feel the urge to purchase a brand new printer, when in reality the corner print shop is just fine. Is your side business as lean as possible? Chances are that money is being spent on areas it simply shouldn’t be. Can you identify these problem areas?
Trying to outsource your Human Resources or investing heavy amounts of capital into IT infrastructure can kill your startup business. Investing thousands of dollars into an advanced business system will do you any good at the very beginning. When you first get started, your primary goal should be to solve problems. A complex business system will just create problems for you. These will be problems that interfere with you being able to solve problems for your clients. Once you stop solving problems for your clients, chances are that your business will cease to exist.
It’s 2010, do you really need an office? Too often does a small business owner invest too much money into space to conduct business. The reality is that these days all you need is an internet connection to conduct your business. No longer do you need an office space with a personal secretary to handle your business matters. Now everything can be done from your living room, or the local coffee shop.
Outsourcing is important. Especially for those that have read the ever popular 4-Hour Work Week book. Outsourcing has become a staple of every business. Unfortunately, it has gotten to the point where new business owners want to outsource everything (from minor administrative tasks to mega projects).
Don’t get me wrong. I’m all for outsourcing mundane tasks, but where do you draw the line? How does one determine what to outsource? The problem is that it becomes difficult to distinguish. Once a small business owner realizes how easy it is to outsource certain tasks, there’s no telling how far they will go. Therefore, it’s critical to realize that outsourcing isn’t the magic formula for getting a small business off the ground. The key will never be fully known, but it won’t be as simple as passing off all of the work.
What other small business profit killers have I missed? What mistakes have you seen your small business make?
Image source: NYCEDC
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