Starting a business can have many implications in an era of informed customers, multiple competitors, and lack of information asymmetry in this digital world. One wrong move initially and all your hard work and brand equity will nosedive, and you will be back to square one.
The term VUCA (volatile, uncertain, complex, ambiguous) world is quite real, which is what every entrepreneur feels today. This blog will highlight some of the mistakes you should avoid while starting a new business in the UK.
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Mistakes that Business Persons Usually Do
Let’s dive deeper into some of the mistakes which entrepreneurs make in the initial stage of their business and how you can avoid it. Here it goes:
This is one of the critical things to contemplate and decide over before starting your business. It could be a sole proprietorship, general partnership, limited liability partnership (LLP), private or public limited company, etc. These structures have their share of advantages and disadvantages.
Many entrepreneurs keep thinking about which business structure to go for, or many are stuck with one business structure and want to change it.
Choose the Product or Service
You might get fascinated seeing an entrepreneur excelling in his business, and you try to emulate that. However, the product or service he is selling might not be in great demand, or he already has a customer base, and you are trying to enter his territory with the same product or service.
Experts and business consultants have always cautioned entrepreneurs to stay away from this approach. You should develop enhanced products and services to gain a competitive advantage and deliver value to your customers.
The bottom line is, what is working for an entrepreneur might not work for you. Thus, do thorough research of the market you are trying to target.
Identify Your Business Model
This is another fundamental mistake that entrepreneurs make in their business. Multiple business models vary from one industry to another. You can choose to become a cost leader in your industry and optimize operational costs to reap more profits.
You can be a prime business by offering excellent customer service and charging a premium for the same even if you have to take loans for the unemployed in the UK.
Many business owners make the mistake to switch to different business models after they have failed in one or try to copy other businesses. This is something you should avoid.
The supply chain is an integral part of any business. It includes vendors and suppliers who provide you with raw material. It includes your logistics partner, players in your distribution network, etc. You have to have good working relations with all these stakeholders to effectively serve your customers.
Many entrepreneurs are always on the lookout for new partners that disturb their supply chain, and thus it affects their business, and customers switches to other companies. Stick to a single or a couple of supply chain players to have consistency and stability in your business.
Unleash the Power of the Internet
Internet is available for every individual and every business, but not everyone uses it the same way. You have to spell out how you will use the internet to your advantage.
Internet is unarguably a powerful tool for your business, but you have to use it, it cannot work on itself.
Many entrepreneurs make the mistake of targeting their competitors to win their customers and business from them. This is not how you should use the internet instead of communicating your target audience’s value offerings. Inform them how you are planning to help them with your products and services.
Start-ups in the UK are building and centered on the premise of modern technology, but not every small business and start-up is on the same page on this front. Many entrepreneurs are still relying on outdated technologies in their organizations, some due to lack of money and some due to lack of awareness about new technologies.
Technology helps businesses to acquire more customers. It helps to reduce operational costs. It leads to customer satisfaction and whatnot. The bottom line is, technology is inevitable, and it is something without which you will have a tough time running your business in a technology-driven era.
Thus, you can be a laggard when it comes to cutting edge technology adoption, but do not make the mistake of missing this bus.
Presumptions about Customers
Many entrepreneurs often rush into knowing their audience and bucketing them all in one category. They think that all these customers are similar in many aspects, and thus the product is meant for them.
This is not true as customers have diverse and complex tastes and preferences these days. Thus entrepreneurs have to evolve with the changing needs of their customers regularly.
Entrepreneurs will have to make adjustments to their product to make it future-ready and keep interacting with their customers to know what they expect from the business.