Mike and Maria were clothing designers and constructors. They enjoyed working with these skills and decided to start a new business. They recognized the absence of finely tailored suits for business women. They were also aware of a business area in their town that they thought would be ideal for a specialty shop.
This was avery exciting idea, so they acquired as much start-up money as they could and opened the doors of a shop in this ideal area.
Once people began noticing the business, many assumed that they could bring clothing there to be altered. The display in the window was made up of dressed mannequins and tailoring supplies. Since the owners and their partners thought it would only take a little of their time and bring in revenue, they decided to take in a few alterations. Of course, they did a great job and the alterations service grew leaving little time to develop the custom tailoring Vision. Alterations and small jobs for theater costumes took up all the time and provided enough income to support the business without little profit. This continued for years and the business never became what it was meant to be. After several years of struggling to make a profit, the doors were closed.
These owners made a mountain of mistakes. With just a little thought, you could probably name many of them. In this article, I will highlight a three of the major ones.
1. The owners weren’t true to their original Mission and Vision. This happens to new businesses because they haven’t taken time to do the planning homework necessary. Most entrepreneurs have great ideas in their heads and it seems as if nothing could go wrong. Mike and Maria did not take time to write and commit to definitive Mission and Value statements. The act of writing a clear Mission and a clear Vision helps you design the future that you really want. Commitment will keep you going in the right direction.
2. The owners didn’t realize the value of business management and they didn’t have the necessary skills. Beginning a successful business requires a knowledge of the management requirements. Each element of the business required adequate management. Many new business owners think their superior skills will be enough to make them successful. Success in business requires a big picture perspective, that is, the owners must position themselves as working on building a business rather than working in the business only. This requires management skills such as strategic planning, performance management and others. Planning how you want to apply these skills in your new business will help you avoid the many pitfalls inherent in new businesses.
3. The owners had no idea of the actual cost or complexity of running and maintaining the type of business they where entering. Technical skill is not enough. New owners must study the industry, visit similar businesses, or do something to give them a realistic idea about what they’re getting into. Mike and Maria bought equipment and supplies. They also hired additional tailor before earning any money. They quickly used all of the startup funds because there wasn’t a plan for how to apply the money.
These are just three mistakes that they made but a little more detail and a quick analysis will reveal more. As you design your business, be aware of the importance of careful planning before you launch no matter how exciting the venture seems to be. Learn the management skills you need to work on building a successful business. In this information age, you can research almost anything. Take time to do research and it will help you become an expert manager in your business. Your business can survive and become a leader in your industry.