As a small online business that helps other small online businesses, we've seen just about every mistake get made. (And made plenty of them, ourselves.) At this point, we're stoked to see our homegrown company growing like a frickin' weed…but boy, do we slap our foreheads sometimes when we think back to the way we used to do things.
But hey, our mistakes of the past are your pro tips for today! Get ahead of the learning curve with these top 5 wrong moves that every small business owner makes, until they learn a better way.
1. Sacrificing pay for growth
When you’re just getting started, you’re like a mother with a newborn baby—you’ll give anything to help your fledgling business grow. That works fine for new mothers because babies give back pure, unadulterated love. But—cold hard truth warning—businesses love you back in the form of revenue. Yes, you may love your customers, and what you do to serve them, and the freedom and flexibility of being your own boss, and the heady feeling of reward that comes with taking every opportunity to help your business expand.
But if you’re not pocketing enough pay to support yourself and your family, you’re putting yourself and your business in a bad place. At a certain point, you’re going to start burning out and not even know why. And a burned-out owner spells death for a business.
This means more than just enough to pay your mortgage and put dinner on the table. You need to have money to play with. Take a vacation; go to the movies in the middle of the day; buy that artisanal sheepskin rug just so you can roll around in it.
We’re not saying go buy a yacht or anything. We’re saying a healthy bottom line starts with your health, physical and mental and emotional.
2. Avoiding documentation
This is a sure way to fall behind. Ziplocs full of receipts and a word-of-mouth transmission of SOPs may seem like a good-enough holdover until you’re ready to create “official” SOPs. But here’s the thing: those holdovers are your way of doing business. If you don’t write them down, you’re creating a situation where nobody can ever help you because it takes too long to explain. As a result, the whole business depends on you. Forever.
No matter what size your business is now, documenting what you’re doing matters. When you have a record of what’s happening, you can look at it and see how well it’s working and—here’s the important part—make strategic improvements. You’re not just throwing new systems at the situation all the time and hoping that they’re better. Best of all, you can bring people in to support you and not have to spend hours trying to make sense of your brain’s intuition.
3. One bad hire after another
Most people don’t hire until they’re desperate, and then they hire the first person at hand: a well-meaning friend, somebody’s teenage relative, a Craigslist find. Yes, it sometimes happens that you stumble across a treasure and that person grows with you and your business. But that is rare.
The rule of thumb is hire slow, fire fast. But you can’t follow that advice when your business suddenly outgrows your capacity to run it singlehandedly. Whether it’s as simple as seasonal help or a full-time management partner, you need to know what you need before you need it.
Again, documenting your process from day one will allow you to see where you need support, and help you know exactly what skills you’re going to need. So you can’t afford to hire right away? That’s fine—when you’re able to bring someone in, you’ll know exactly whom you’re looking for.
4. Training and educating yourself way more than is necessary
It’s a blessing and a curse that the Internet is full of coaches, experts and “gurus” who are ready to teach you all the secrets for anywhere from $9 to $99.99. Take it from a self-education junkie, they are not all experts.
Only after many dollars and hours spent do you find out that failing forward is the best way to move ahead.
Here’s a little secret: most of the programs you’re building your online business around? They have customer support lines that can give you all the education you need to get your biz up and running. At that point, it’s just a matter of getting in your ten thousand hours. (Here’s to you, Malcolm Gladwell.) Learning to use your programs and software, running into obstacles, calling a friend/Googling the problem/chatting with an online agent, and maneuvering around that obstacle to the next one.
Once you’ve done that for a good amount of time (usually a year), you’ll be grounded enough in who and what your business is to get value out of extra education and training. Just like with hiring, you’ll be able to accurately identify the areas where you really need support, instead of signing up for every course or webinar that comes along.
5. Avoiding investing in a financial system/plan/mentor
This is another one of those “I’ll do it when I’m bigger” things that are best done while you’re small. Getting a solid financial system in place while your business is still young has two great benefits:
- You get lots of practice in thinking and making decisions strategically. It’s good to get that practice while the decisions are low-stakes; you’ll feel much more confident when the stakes rise and a lot more money is on the line.
- You have more control over the direction of your business. If you’ve ever planted a rose bush or a fruit tree and forgotten about it, you know what a pain it is to prune the whole thing back. But if you cultivate and train it to grow the way you want while it’s small, it requires a lot less maintenance from you once it gets big.
When you’re in business for yourself, profit can't wait until you can “afford” the resources you need. A healthy bottom line all comes down to what you value and what you consider your priority to be. If you prioritize your financial health, you’ll pay for the care it needs. Simple as that.
The Bottom Line
No matter what industry they're in, small business owners tend to share one thing in common: a do-or-die determination to see their little company succeed. That determination will drive you to run through walls, which is awesome…unless there's a door in the wall that you just didn't see.
It always feels better to look forward in your business, instead of looking back. Plan ahead now, and you’ll be ahead of the curve.
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