4 Common Blunders That Stop Startup Businesses in Their Tracks

1. Lack of funds

Business needs money. You soon find it does little else but consume funds — lots of it.

If nothing else, the business needs to provide a source of income for the business owner, not as profits to the owner but as a wage or salary to an employee. Nearly every small business I have been in (including my own in the early days) fails to pay the business owner a market wage. Not paying these kinds of expenses hides the true cost of running a business.

While owners may forgo income in the short term to get the business rolling, most business people do this because they don’t have the funds. If they don’t have funds to pay appropriate wages to the workers (themselves), then they probably don’t have adequate funds for sales and marketing of the business. Or perhaps they don’t carry some of the insurances a business really needs to protect it from disaster.

Lack of funds, however, is a symptom, not the problem. The problem here is either poor sales, or poor expenditure control — or both.

2. Too Much Debt

To solve the funding problem many business owners borrow to get the business going. But borrowing money can lead to some unexpected results.

Borrowing large sums of money when you have not learned to manage such amounts can easily lead to disaster. One business I know exhibited this problem. The new owners obtained a $50,000 loan to get the business going, and spent a huge portion of it leasing prime office space and furnishing it to a very high standard. Rather than apply the funds to marketing and sales, they spent it on appearances. They lasted about three months before they shut the door.

3. Poor Pricing

The way many businesses get started is by pricing themselves at the lower end of the market. This pricing strategy has nothing to do with pricing for results. It is just that the business owner really does not have the courage to ask the higher prices that established businesses are charging.

The under-priced business owner soon finds that his customers really don’t appreciate him or the fact that he’s so cheap. He finds that his customers soon drift off to do business with the higher priced people in town, leaving him to find a new customer to replace the one he has lost.

It takes a year or so (sometimes a lot longer) of operating like this before the business owner decides he has little to lose if he puts up his prices. So he timidly asks the next customer to pay more, finds he gets no rejection on the basis of price, and finds now he can afford to offer a better quality service or product to the customer.

Since people do not buy on price but on value, the business owner is beginning to learn that his price is not as important as the value he brings to his customer.

4. Poor Sales and Marketing

Business takes place only when a sale has been made. Yet many attempt business without the skills of finding customers or making a sale. Somehow they believe that customers will walk in the door and all will be well. But too many startup business owners are weak in the these areas. Therefore, the business suffers.

Tips To Assess The Performance of Your Business

A Costly Mistake

The above line of thought could become a costly mistake for an entrepreneur on multiple counts. Effective budgeting helps one assess profit targets while avoiding unpleasant and expensive surprises. With budgeting, one can accurately calculate how his business stands at a particular point in time, and whether the business is a profit making or losing proposition.

With a proper budgeting mechanism in place, it is possible to meet the needs of the enterprise by making the right move at the right time.

Effective Tips for Performance Management by Using the Budget

Some of the most useful tips for performance management include the following:
• Budgeting the right way is the first step in proper assessment of overall performance for any business and its effective management.
• A budget is not merely a sales forecast. It should be created with coordinated input and efforts of the manager and the management team. Naturally, a budget cannot be made hastily. Taking adequate time to prepare the most efficient budget is the order of the day.
• Practice makes man perfect. With constant practice, the forecasting capabilities any entrepreneur will improve substantially.
• There are certain common principles on which every assessment is based, and no company can be an exception to such common principles. Striking an effective balance between the amount of time that is invested, as well as forecasting the accuracies will be the right step in the right direction.

Surplus in Budget for Performance Assessment

Using charts could be very effective to set the timing and working conditions right. Also, an entrepreneur should understand that while either no surplus or deficit budgeting could be good for state level budgeting, it is not so in the case of commercial enterprises.

One can hardly forecast all the expenses that could come up until the end in business. Keeping some resources for the contingencies would be a good step. Moreover, when there is some surplus amount reflected in the budget, it will indicate that the business is not short of funds and is not likely to face a crisis in case of some future financial contingencies.

Multiple Aspects of Business Performance Assessment

Business performance assessment involves multiple factors, some of which are –
• Learning about the benchmarks that mark the characteristic features for good business performance.
• One of the most effective tools is the balanced business scorecard that can assess the business performance very well.
• Leveraging greater values from business reporting; this is necessary, since these reports are generated using a lot of time, energy, and money.

Reasons for a Business Going Bust

Many good running businesses have failed over time, and so, it is necessary to understand the factors involved in the success and failure of any business. Doing so will help entrepreneurs adopt the methodologies and steps that would help their businesses achieve success and minimize

E-Business Success Is Key For Self-Employed And Small Businesses

I found my online presence while searching for a new way to run my business. I’m an insurance broker who made the transition from face to face business production to mainstreaming online. The internet is the key to the long term success of the vast majority of small businesses. The problem is that most small business owners don’t have a clue of how to succeed online. Building an online business is a whole new arena that is foreign to many…unfortunately even to most so called “SEO Experts.”

Many business owners make the mistake of investing capital for a web designing and SEO service that ends up giving them a flashy looking web site that drives no business for them. The do it yourself types will read an e-book and jump in the online business pool and hope to swim. Unfortunately, they all drown because there is simply too much information that needs to be absorbed in order find success. You need to do everything right and understand nothing happens online overnight.

I have become passionate about online business as there is a connection between it and my niche. I sell health insurance products and the majority of individuals doing anything full time that is e-commerce related are of course self-employed and need their own health care. This simple truth creates my drive and mission; to spread health care awareness and e-business success for all self-employed individuals and small business owners.

America’s health care problem has a major impact on small businesses. With the proper resources and the required dedication, your small business owner or aspiring entrepreneur can achieve their independence and create an identity for themselves online. The internet is like outer space, there will always be room for another profitable business web site.

It’s almost disturbing that one of the biggest obstacles for many to reach their online goals is being directed by the wrong resource. It’s like being taught how to drive by a six year old. This is why it’s vital to do your research before investing with any internet service provider. Check them out on Alexa.com and never make a spontaneous decision. It can be a tremendous burden to gather all the information and resources you need to build an e-business and you can find yourself jumping all over the web looking for help.

It doesn’t have to be that difficult. It can be a straight forward, one step at a time process that you can execute with clarity and enjoyment. The only way to experience this is to connect yourself to the right resource. A company held in the highest regard for their e-business building expertise. They have been building business on the web since the internet was just a baby back in 1997. They hold your hand within a community that feels like a big family.

This is the resource I have found and it has saved my online business dreams. I have recently shared their guidance to others on my Facebook business page. I have pooled together an E-Business HQ page on Facebook that will give away all the free e-business master course e-books along with case studies, resources and software that are all free to use for growing and developing your business. Sharing the right resources will help grow small businesses and strengthen our economy. There is much recovery left to achieve in America.

3 Common Mistakes to Avoid When Starting an Online Business

There are many reasons why. Maybe you are totally frustrated with your daytime job and you feel trapped. You want to get out of the Rat Race. Maybe you are tired of working for someone else and it is time for you to be your own boss. Maybe you just lost your job and you have nowhere else to turn. Whatever the reason, an option of starting an online business has crossed your mind, otherwise you would not be reading this article. Let me make one thing clear. Starting an online business requires work.

If anyone tells you otherwise don’t believe them, run the other way.

If you want to start an online business allow me to share with you 3 common mistakes to avoid when starting an online business.

1) Starting an online business without a Game Plan
2) Not having the finances it takes to start and maintain an online business
3) Not Being Patient enough to see things through once you get your business off the ground

1) Starting an Online Business without a Game Plan:

Starting an online business can be very exciting however, before you jump in you must have a game plan. Can you imagine a football team going into a big game not having some sort of game plan? Take the time to put your ideas on paper. I know you have it all in your head, but that is not good enough. You got to write it down on paper. What is it that you want to accomplish? Write it down. What are your goals? Write it down. I know you want to make all this money, but be specific. Make 6 month goals, 1 year goals, and 5 year goals. What is the lifestyle you see yourself living in the future? Write it down. Although, this is not a hard task, many people start a business without knowing the desired outcome.

Now that you have your goals written down, create a game plan as to how you will get there. How are you going to arrive? At this point you may not know all of the specific details however you can have a general idea of how you will accomplish your goals. Put a Game Plan together and write it down. Then, visualize how you will feel once you have arrived. Create a vision board and see and act as if you are already there.

* What is it that you want to accomplish?
* Write a Game Plan as to how you will get there.
* Visualize as if you are already there.

2) Not having the finances it takes to start and maintain an online business:

There are expenses associated with starting an online business. It takes a little bit of money to make money. Although, there are many free online tools that can help you build your business, there are some expenses. Some of these costs are one time cost however there are some fees that are recurring monthly expenses. You must plan and account for expenses. Before starting an online business you will need to set some money aside to get your business started. Once you get your business up and running and you start making some money you may want to consider outsourcing. This will free up your time, however this is optional.

How to Create an Unbeatable Business Structure

As I go through this article I’ll show you what I see in large organizations that have caused many customer service problems and also show you what they should have done to avoid those problems. More importantly I’ll show you what you can do now to avoid falling into the same traps.

AN IMPORTANT CONCEPT.

I use something called “Event-Driven” concepts in order to obtain many benefits for an organization. Basically “Event-Driven” means focusing on whomever or whatever is your customer. Let me start with a basic premise: All systems we encounter, be they human, computer or in nature, have a fundamental characteristic in common – they’re all “Stimulus-Response mechanisms”. For example: A storm (the Event), produces rain (the Stimulus), which produces erosion (the Response). Over time, the response can be something as significant as the Grand Canyon in Arizona.

Every organization simply selects a set of Events that it wishes to respond to from the external world; e.g. A customer wants to place an Order or Request your services. Each external need to which the organization responds is called an “Event”. Now, it’s the “Event” happening outside your business that initiated the action that your business takes. For example when a customer wants to buy a product of service from your organization the Stimulus Request may go through a whole bunch of people tasks (even different departments), and/or a bunch of computer programs (even different computer systems). It may be recorded and retrieved in and out of manual files or even computer databases and so on before it becomes an Event Response out of the whole organization. The total set of individual processes, their data and files make up what I call an “Event-Driven Reaction or Partition” – one initiated by the customer. Note the best context within which to view an Event-Driven Reaction is from a whole business point of view rather than from any one person/department or computer program/ system context. Taking this view will also give us the most benefits to the organization.

Using my example above what appears to be very obvious in this all-too-typical large organization structure is our Event response has been sliced-up (partitioned) for very different reasons than around a customer’s need. In fact the predominant partitioning/structure seems to be based on human skills and computer software package reasons rather than customer focused Event-Driven reasons; the resultant structure even being controlled by a classical military hierarchy, in other words formed from industrial-age and earlier reasons. In an efficient, customer-focused business we must not perpetuate this “fragmented” structure.