Do You Make These Mistakes In Your Company? Fix them soon for Business Success.
Being an entrepreneur is a great challenge and at the beginning of the entrepreneurial career it is common to make mistakes in business management, since you are responsible for doing everything in the company, going through 3 levels of management (strategic, tactical and operational) in all areas of management (planning, finance, marketing / sales, people, processes, etc).So the question is: what are the main mistakes that entrepreneurs make in business management and how to fix them?
1.Lack of planning: unfortunately there are many entrepreneurs adept to “fazejamento”(illustrative word in “portuguese” that means: “DOES! in any way without planning”) , in this way, according to research conducted by Sebrae, it is no wonder that one of the 3 main reasons for mortality of small companies in Brazil is the lack of planning, accompanied by lack of entrepreneurial behavior and poor management.The solution here is simple – plan – have goals, targets and indicators that ensure business survival and growth.
2.Mix personal finances with company finances: you will never know the actual results of your business financial indicators (profitability, profitability, breakeven, etc.) if you make this mistake, you will have great difficulty to calculating the price correctly of selling your products and services. Determine a monthly pro-labor (salary) for you, either based on what it would pay for an employee to do what you do or based on the amount they need to pay their personal expenses.
3.Make financial controls head or on paper: whatever the size of your business, it is humanly impossible to do all the financial controls of the head company, even the basic controls as daily control of cash and / or cash flow.Get free or paid software (there are good versions around R $ 130.00) to manage your business, so you organize and standardize your business, and you have more time to think and act strategically instead to do “firefighter management” and to put out fires all day.
4.Use “matemágica”(illustrative word linking Mathematics with Magic), to form a selling price: if you form a selling price of your product / service multiplying by a magic number be careful, you can have a lot of damage doing this and still have the illusion that you will make a profit. Sales price formation should be based on fixed costs (paid every month), variable costs (paid according to the volume of purchase / sale), profit (result of the difference of incoming and outgoing ), model of business (competitive differentials) and competition.
5.Make the mistake of not including everything in financial controls: it is not uncommon to find entrepreneurs who disregard important financial information such as pro-labore, depreciation of machinery and equipment, food, lodging, fuel and toll expenses when buying goods and ending the month with a mystery of “where the money went.”Do not fall into the temptation of “I will record this expense later” or “a little bit makes no difference”, some bottlenecks will only be identified when controlled with indicators, bid all inflows and outflows of money to ensure good control and management of the business.
>6.Make the mistake of not searching and not following the market: current customers are increasingly demanding, connected and following trends, so if the entrepreneur is not attentive can end up being “fired” by the market.Opening or having a business that does not compete in the market is something almost impossible nowadays, in addition to the profile of the current client it becomes imperative that the entrepreneur identifies the KSF (Key Success Factors) of its segment of performance, compare your company with the competition in relation to these factors and take the necessary steps to stand out and be expert in one or more factors.
7.Non-professional or non-existent digital marketing: either because of lack of knowledge or lack of technical knowledge on the subject, many entrepreneurs still resist this type of technology and some use it in an amateur way. Digital marketing is not fashion or trend but rather something that has come to stay then or you seek the basic knowledge needed to use excellent marketing, sales and relationship channel, or hire a professional to do it for you, otherwise your business will not be remembered or recognized on the Internet, which can be extremely detrimental to your business.
8.Not paying attention and not listening to the current customer: there are few small companies that do research for satisfaction, they think it is something only for big companies. In this case, I point out here a finding by one of today’s top marketing consultants, the North American Philip Kotler, he says that conquer new clients costs 5 to 7 times more than maintaining existing ones, so the entrepreneur needs to do research of satisfaction to have feedback from its customers and, based on the results, create loyalty strategies and increase the average ticket (Billing R $ / Sales Realized).
9.Makes the mistake of not knowing how to sell: there are many sellers, but few sales consultants, while the first is concerned with selling products / services, the second sells solutions to the needs, problems and desires of the customer. Your company needs to have sales consultants. Selling is a process in which it is necessary to know the market very well (customer, competition, suppliers and trends), for this the entrepreneur must research and know valuable tools as a map of empathy, person, consumer buying and sales funnel to professionalize your sales process, train your team and increase your chances of success.
10.Lack of interest to develop as leader / entrepreneur: unfortunately a significant portion of entrepreneurs is a slave to the business itself, some even manage to take some leftovers as pro-labore. Perhaps, this situation happens because they do not see themselves as protagonists of the business, that makes happen, that will not put the blame in the market (government, competition, supplier, customer, etc.) for the failure of the company, that is, they do not see themselves as leaders, for even if they are successful at the beginning working alone, if the business grows they will have the challenge of setting up a team to help them continue their success, so the best solution here is to develop as a leader and entrepreneur.
11.Make the big mistake of not investing in the development of your team: the justification for this mistake is almost always the same “I will not invest in my employee because then he leaves”, so, in this type of situation, I ask that the entrepreneur do the reflection otherwise, that is, and if not invest in the employee and he stays. There are countless successful entrepreneurs who are also great leaders, these two skills go together, in both cases you will need a good team, which is built with training and development.
12.Lack of a process recruitment and structured selection : Most small businesses in Brazil are familiar, this contributes to the error of hiring employees, having as main reason the fact of being related. It is not wrong to hire a relative to work within a business, however, one must also take into account other factors such as: knowledge, skills, attitudes, experiences and compatibility of the profile of the future employee with the objectives, mission, vision and values of the company and profile of the team of which it will be part.
13.Lack of standardization of processes: this error is related to the short-term thinking of the entrepreneur when thinking that as it will always be he who will do everything is not necessary to standardize. Standardization of products, processes and services is not only to enable others to continue to do what you have always done, it is also important to ensure quality, optimization of resources, cost and loss reduction, basis for sales price formation and allows the expansion of the business, can make it scalable and replicable (franchise and affiliates).
Now that you know the main mistakes made by entrepreneurs and know how to fix them, think if you make one or more of these errors and, if so, make a plan of action to correct soon.
Author: Rafael de Souza – Business Analyst at Sebrae-SP.