Invest with a plan!

One of the biggest mistakes that I had made when I first opened my start up was investing money into sections of the business without any real direction or strategy behind the investment itself. You would be surprised how detrimental it can be for a small business to invest money into aspects of the business that will never really help the growth of the business itself or will do very little in helping you to turn a profit.

This is a mistake that any business still in its baby years would experience, and to this day there are multi-million-pound companies that are still investing money into arms of their companies that will never provide a return of investment that they are looking for. It’s also unsurprising how common this is for businesses around the world.

The truth is, many companies around the world will make this mistake at some point in their history. There is also some upside in making such an easy mistake. It will provide the business owner with some experience in what they should and should not do in the future.

Investing into your business will always be a risk, but that is why it is important to make sure that your investment is somewhat planned. If you have made some efforts to ensure that any steps you take will provide ROI, then that is the best you can possibly do in terms of an investment situation. However, the more research and due diligence that you participate in for your business, the higher chance you will see a drop-in failure rates regarding potential investments.

There is also a defeatist attitude in not providing the best possible research you can into any potential business investment steps, so you should always be prepared to find out as much as you can regarding a possible investment before proceeding with anything.

Branding is not that important

One of the largest mistakes I have seen many companies make within their initial periods is relying too heavily on the naming aspect of both their overall brand, and their products or services offered. There is an underlying effect of positive results that come from a great name for both your brand and the thing you are selling to customers, but there are many negatives that come from the overall focus on branding of yourself.

While it may seem defeatist, spending less time on your companies branding of both its name and its products can really help both your personal confidence and the overall length of time for your business to compete. I am personally speaking from experience, as I have at points spent weeks feeling like I cannot make any progress until I felt that my businesses name and products names alone would entice customers to spend their money with me rather than competitors.

However, the focus on branding is detrimental when you stall operations to focus on such a small issue. The name and branding of your company will make very little to no difference on how your customer will see your company. The name of your company matters more to the business owner than it would ever matter to a customer unless your name directly undermines your business itself.

There is a lot of be said of your branding itself in terms of colour schemes and logos over the name. Logos are one of the defining factors for a customer to decide if they feel your business is great or not. Whatever the name of your business, the logo is the most important aspect. If the logo looks great in comparison to the name, and the colour schemes are eye catching for the average consumer, then you will see more success than anything else.

Quality first

One of the most difficult parts of a start up is ensuring that your product is at the level it needs to be. Many start ups base their initial expected success on how great or better than competitors their product is. However, even though their product may be vastly superior in comparison to their competitors, there are still a few factors that will come into play during the initial start-up phase.

The most important piece of the puzzle here is to ensure that the consumer or customer themselves are aware of how superior your product is compared to your competitors. If the customer is unaware that your product is better than your competitors, then there is little reason for customers to purchase yours rather than a competitor.

This can be done through advertising. Advertising your product both on your business website and through other channels is the key factor in enticing customers to purchase your product, rather than look at yours without reason to trigger a purchase. This can be difficult, and a lot of experimentation is necessary in order to accurately and convincingly advertise your product over competitors.

Another way to do this is through quality control and long term build up of your brand. A great custom furniture Sydney based company has used this model with a lot of effect. The basis is to ensure that over time, your brand and product name has become popular through word of mouth and increasingly positive reviews until the product can survive and be advertised within its own merit.

Of course, there is the third option which is to invest heavily into advertising while always ensuring high quality control of your product. Over time, your brand and product will automatically be the go-to for customers around your location. This is the best of both worlds but difficult to accomplish.

Taxation

You may not be surprised to hear this, but many companies can fold for the most obvious reasons: tax. When you first begin trading, taxation is not the key issue for you as you are struggling to make a profit as is. While some companies may have the “problem” of having to pay corporation tax within their first year because they make a profit, most start ups fail to see any profits within the first 3 years.

The problem with when you do begin to see a profit is that you need to immediately work out the tax that you now owe. With people who are not good with accounting or have never experienced auditing their own finances for a company, there will be a lot of things you are unaware of. All the way down to what may count as an expense or not, and what you are able to be taxed on.

What you will find is that many of the expenses that you part with during the running of your business reduce the overall tax. Many initial starts up owners believe that they are taxed on all incomings, but this is incorrect. You are taxed on most of the income that didn’t need to specifically be reinvested.

What you should do before you begin to work through your accounts is speak to a registered accountant who will be able to provide you information regarding what is subject to taxation for your specific business. While it may seem like a lot of the income your business brings will be taxable, there are a lot of ways you can avoid the total taxation. Accountants are also useful in finding ways for you to save money, and they will have creative accountancy methods to ensure that your business is not being taxed more than suitable.

Tales of a startup

Here at Tales of a Start-up, I wanted to go through some of the many challenges and successes that I faced when I first opened my start up company. If you have your own start up, then you will be partially aware of the many issues that I faced when I wanted to get my companies feet off the ground.

Creating and successfully running your own start up company is more difficult than you may think, despite how experienced you may be within your field or business market. When you first create your start up, it will most likely be in a market or industry that you already know, so you will feel that you do not have much to learn. This is the first big mistake that you can make, as there is always something new worth learning for your company.

Ignoring any chance to learn new pieces of information regarding your business is a key way to ensure that your business falls before it has even begun. You need to learn as many new things as you can for your business, as you will quickly find the marketplace passing your experience by. There will always be innovations, and the best companies are those that replicate those innovations the first chance it gets, or they are the companies that create and innovate first.

The modern classic example of this would be a company such as Woolworths. It was a household name in every western country in the world and was for the last 50 years of its trading life. Now, there is a generation that has no idea of what Woolworth is, because they could not innovate like other supplies have such as Amazon. They also refused to replicate the model by not delivering their many items without charge, putting the nail in the coffin.