Most surveys agree that 9 out of 10 startups fail within first five years of their existence. This really comes as no surprise, seeing as how it is easy for a startup to succumb to relentless cash burn, face an inability to raise enough capital or simply suffer from poor leadership. While failure due to these major issues may seem inevitable, sometimes a startup might get endangered by an easily avoidable mishap.
In order to see just how deep the rabbit hole goes, here are four examples of such mistakes that could cost your company dearly.
1. Not Adjusting Your Strategy To Changes
Imagine a scenario where you do all the research about the local market, devise a sound business plan to match it and set things into motion. Unfortunately, several months after you have launched your business, a powerful competitor arrives and changes the game entirely.
Due to a lack of experience, a lot of aspiring entrepreneurs believe that market research is something that should only be done prior to a launch, which makes them lose interest in this field immediately after. Sure, once your clients start abandoning you in droves and your sales begin plummeting, you will notice that something is going on.
Nonetheless, by this time, it might be too late. In order to be ready for this, simply keep an eye out for new faces in your industry, especially those who are encroaching on your turf. The easiest way to do so is through Google Alerts. By receiving an instant notification, you can start devising a way to stay competitive right away and therefore increase your odds of survival significantly.
2. An Expensive Lawsuit
Today you would be surprised to find out what people are suing others for. In January 2014, a guy from Oregon sued Nike for not mentioning Nike Air Jordan can be used as a dangerous weapon. Furthermore, a Chinese man won the lawsuit against his wife for ‘deceiving him she was good looking by undertaking a set of cosmetic surgeries’. This is just the tip of the iceberg.
Ridiculous as these examples may sound, your company might find itself accused of faulty advertising or even a telemarketing fraud that are similar to the above-mentioned. Sometimes, you will actually be the one to blame but not due to malicious intent but due to sheer ignorance. The best way to avoid this is to get in touch with specialized legal advisors like experienced Bordas & Bordas consumer fraud lawyers. Needless to say, a brief consultation with an expert can make the safety of your marketing campaign ironclad.
3. Disregarding In-House Theft
Another major issue that can bring your company to the brink of ruin is the mistake of disregarding the problem of in-house theft. Sure, you may handpick your staff and believe in them 100 percent but a single dishonest member of your crew can cause your business to suffer a substantial loss. Luckily, there are more than a few ways to prevent in-house theft from happening. One of the methods is organizing a peer system, where no one is left alone around office valuables. You should also try out security clearances and indoor surveillance system, at least for your storage area.
4. Ignoring The Insurance
Finally, one of the greatest lapses of judgment you can make as an aspiring entrepreneur is to convince yourself that your business is too small to insure. The more you grow the less room you will have in your budget to handle this properly, which is why you should include property insurance, vehicle insurance and product liability insurance on your list of expenses from day one. Moreover, you should also find some room for things like workers’ compensation insurance and surety bonds.
Conclusion
Of course, the above-listed four issues aren’t the only mishaps that could run your business into the ground. However, they are the ones that are commonly ignored. Honorable mentions are ignoring cybersecurity, as well as relevant laws and efficient business practices. As you can see, avoiding these mistakes is really not that hard, provided that you know they are a real threat in the first place. Knowing that there is a trap is the first step in successfully evading it.
I hope you enjoyed this article about avoiding various common mishaps that can ruin your new startup.
Interested in more articles about securing your startup?
Read My Posts:
- Tips To Generate The Leads You Need
- Getting Your Business To Go Global
More Bootstrap Business Blog Below
1. Not Adjusting Your Strategy To Changes
Imagine a scenario where you do all the research about the local market, devise a sound business plan to match it and set things into motion. Unfortunately, several months after you have launched your business, a powerful competitor arrives and changes the game entirely.
Due to a lack of experience, a lot of aspiring entrepreneurs believe that market research is something that should only be done prior to a launch, which makes them lose interest in this field immediately after. Sure, once your clients start abandoning you in droves and your sales begin plummeting, you will notice that something is going on.
Nonetheless, by this time, it might be too late. In order to be ready for this, simply keep an eye out for new faces in your industry, especially those who are encroaching on your turf. The easiest way to do so is through Google Alerts. By receiving an instant notification, you can start devising a way to stay competitive right away and therefore increase your odds of survival significantly.
2. An Expensive Lawsuit
Today you would be surprised to find out what people are suing others for. In January 2014, a guy from Oregon sued Nike for not mentioning Nike Air Jordan can be used as a dangerous weapon. Furthermore, a Chinese man won the lawsuit against his wife for ‘deceiving him she was good looking by undertaking a set of cosmetic surgeries’. This is just the tip of the iceberg.
Ridiculous as these examples may sound, your company might find itself accused of faulty advertising or even a telemarketing fraud that are similar to the above-mentioned. Sometimes, you will actually be the one to blame but not due to malicious intent but due to sheer ignorance. The best way to avoid this is to get in touch with specialized legal advisors like experienced Bordas & Bordas consumer fraud lawyers. Needless to say, a brief consultation with an expert can make the safety of your marketing campaign ironclad.
3. Disregarding In-House Theft
Another major issue that can bring your company to the brink of ruin is the mistake of disregarding the problem of in-house theft. Sure, you may handpick your staff and believe in them 100 percent but a single dishonest member of your crew can cause your business to suffer a substantial loss. Luckily, there are more than a few ways to prevent in-house theft from happening. One of the methods is organizing a peer system, where no one is left alone around office valuables. You should also try out security clearances and indoor surveillance system, at least for your storage area.
4. Ignoring The Insurance
Finally, one of the greatest lapses of judgment you can make as an aspiring entrepreneur is to convince yourself that your business is too small to insure. The more you grow the less room you will have in your budget to handle this properly, which is why you should include property insurance, vehicle insurance and product liability insurance on your list of expenses from day one. Moreover, you should also find some room for things like workers’ compensation insurance and surety bonds.
Conclusion
Of course, the above-listed four issues aren’t the only mishaps that could run your business into the ground. However, they are the ones that are commonly ignored. Honorable mentions are ignoring cybersecurity, as well as relevant laws and efficient business practices. As you can see, avoiding these mistakes is really not that hard, provided that you know they are a real threat in the first place. Knowing that there is a trap is the first step in successfully evading it.
I hope you enjoyed this article about avoiding various common mishaps that can ruin your new startup.
Interested in more articles about securing your startup?
Read My Posts:
- Tips To Generate The Leads You Need
- Getting Your Business To Go Global
More Bootstrap Business Blog Below
