So you're ready to take the entrepreneurial dive. You are going to plunge into the depth of waters that you have never treaded before. Realize that whether
you are starting a business from scratch or buying a franchise, there are several mishaps that a novice will want to avoid to increase the chances
In this three part series, we will cover the 10 common mistakes of business ownership. I have broken this into the following segments: selecting a business, financial mistakes, and short sightedness.
Business ownership can give you the opportunity to build your dreams, set your own course and navigate the waters of success on your own terms. The business selection process involves knowing your skills and abilities, your goals, and making sure that you keep all this in mind along the course. It is easy to get trapped in the following:
Mistake #1: Choosing a business because you love the product or service.
I covered this topic in a recent post, Finding the Right Match: Balancing YOUR Skills and Interest. It is easy to get trapped in the "love" of a product or service. Just because you love repairing cars as a hobby or love to make chicken salad, does not mean that it will be a good entrepreneurial path. You can quickly grow tired of what you once loved and/or you may not be objectively looking at what is entailed in running that business. For example, food service can be a 7 day a week venture with spikes in busyness throughout the day. If you want to be home in time for Johnny's soccer game and Sally's dance recital, you may not be able to make it if you open a restaurant with dinner service.
Success strategy #1: Choose a business because you possess the skills needed to make the business succeed, you can afford it, and it supports your goals (work/life balance, income, legacy, etc).
Mistake #2: Choosing a business because you already have experience in that industry.
This mistake can be a double edged problem. Just because you are an expert in a particular field does not mean that you know it all. It is easy to get caught in that trap! If you feel that you know it all and are overly familiar with a particular industry, you may not heed the advice of others that have traveled these waters before and know how to "make it work."
And, because you are an expert it is also easy to believe that you know the best and only way to do things which puts you in the role of the technician of your business. You can then become so mired down in the day to day operations of the business that you are doing all the work and not building a business that will have resale value in the future..
Success Strategy #2: You need to function as the owner of the business not the doer of the business. Therefore, you need to separate the function of the business from the function of the owner.
Mistake #3: Choosing passion over practicality
Easy to say that the business has to fit my "personality" and I have to be passionate about it. Remember the passion comes from the successful outcomes of business ownership and leveraging your skill set to reach those outcomes.
Success Strategy #3: You need to look at your business as a means to an end. It is a vehicle, delivering you to your end destination. Successful business owners are passionate about achieving their goals.
Business ownership can provide the opportunity to build the vehicle that will help in achieving your dreams. Avoid these common mistakes that could turn your dream into a nightmare. In order to reach your destination, planning is critical, listen and seek the experience of others that have chartered these waters, and make smart choices that support your goals. It is easy to follow your heart and not your head, beware that your heart may not be able to properly chart the course or navigate choppy waters.
In part 2 of this 3 part series, I will cover the financial mistakes that people make in business ownership.
At FranNet we help people understand if franchise business ownership is right for them as a path to self-employment or an investment, please give me a call at 678.249.9867 or fill out a contact form today.
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