Those who are new to the world of small business ownership are bound to make some mistakes, but many can be avoided, with a bit of education and insight. Here are five of the most common small business mistakes that new owners make, and some tips to steer clear of them.


Lacking sufficient funding.

You’ve heard all about bootstrapping a company—starting out with very little funds. Sometimes that works well. Other times, it’s a recipe for disaster.

Avoid this mistake:

  • Carefully project your first year’s expenses.
  • Add another 20% on top of your projection.
  • Prepare a thorough business plan that will help you get sufficient funding.


Failing to make a marketing plan.

You’ve got a great product or service. One that is so wonderful, you’re sure it will sell itself. Guess what? It won’t.

Avoid this mistake:

  • Identify your target customers, and figure out where they are.
  • Prepare a comprehensive marketing plan to reach those customers.
  • Hire some professionals to create marketing materials that make a great first impression.


Cutting corners.

So your next-door neighbor says he can build you a website for $25, and your high school-aged niece would love to design your logo— for free! Sound like a great way to make money? Think again. Cutting corners makes you look amateurish and tacky.

Avoid this mistake: 

  • Identify your strengths, and use your time at those endeavors.
  • Find some great professionals to help you with branding, marketing, web site development, interior decor... anything you don’t know.
  • Pay professionals the standard rate for their field of expertise—they’re worth it.


Forgetting to delegate.

You can try to do it all, and you might even succeed... for a few weeks. Then you’ll crash from the stress and lack of sleep, which doesn’t help your business succeed, does it?

Avoid this mistake: 

  • Hire bright, talented employees who can take over specific aspects of your business.
  • Encourage self-sufficiency, and give employees the proper tools to do their jobs.
  • Delegate tasks to those who can better handle them, while you deal with tasks that only the owner can address.


Spending too much time at the office.

Yes, in those first early years, you’ll be spending long hours, slaving away at your business. While the growth period will require a lot of diligence on our part, you need to keep some balance in your life. Otherwise, you risk burnout, and losing important relationships.

Avoid this mistake: 

  • Remember the important people in your life, and schedule time to spend with them on a regular basis.
  • Get some regular exercise—even if that means just going for a walk during lunch.
  • Eat healthy; avoid alcohol and junk food.
  • Take a break occasionally. Go to a movie, take a long weekend vacation, read a book.
  • Find some stress relievers, such as massage or meditation.