1. Too Much Office Space
I made the mistake of getting more office space than I really needed.
It cost me too much money, which of course came from my pocket. I was way too caught up in the ego of having a nice space. These days, I am into virtual businesses and telecommuting–why waste money on rent?
Kathryn Korostoff, President, Sage Research
2. Not Knowing Costs Before Doing
When creating a direct response ad campaign in various national women’s magazines,
I failed to factor in the cost of producing and mailing catalogs to the thousands of respondents.
Gerhard Kramer, Marketing Director, Laura K Designs, Inc. www.Psalm23Jewelry.com
3. Hired The Wrong Bookeeper
Years ago, I made a couple of HUGE mistakes when I hired my first bookkeeper…Although I was referred to her by someone I knew, I didn’t really do my due diligence. And since I didn’t know my way around QuickBooks I also didn’t check very closely to see if she was doing her job as promised. After about 9 months I discovered she wasn’t. It took me two more bookkeepers, two years of time (a bunch of gray hairs) and about $3500 to get it reasonably straightened out so I could actually track revenues vs. expenses. Arrrgh!!
Stacy Karacostas Founder SuccessStream Sales & Marketing Solution
4. Moved Business Too Soon
I moved my business too soon… I loved the new location and space but it put more of a crunch on my cash flow than anticipated so I had a tough road for awhile.
Teajai ‘T J’ Kimsey, Internet Marketing Strategist, www.IdeasThatWork.net
5. Cutting It Close For Commitments
Initially gave all clients 24 hour turnaround on my virtual assistant services. That was great when I had one or two clients, but as I grew I couldn’t keep up. Plus, I didn’t limit how much work that would involve. Transcribing one tape takes a lot less time than transcribing three. And yes, some clients expected that 24 hour turnarond on everything!
Diana Ennen, President, Virtual Word Publishing
6. Not Knowing Local Building and Permit Codes
During the build out of our first children’s gym in Severna Park, MD, my business partner, Joe Dondero and I worked 3 straight weeks on building a giant foam pit to hold over 6000 foam blocks. We drew up our plans, loaded 20 pieces of plywood and other materials into a minivan and moved them into our gym to assemble. 3 weeks later after assembling, installing and wrapping the plywood with carpet our project was successfully completed in our eyes. Needless to say, the first inspector walked in and asked if the carpet met the vertical burn rates in commercial buildings, plus he asked if the plywood was fire retardant. It took us less than 3 hours to disassemble a project that took over 3 weeks to complete and not to mention the back breaking weight of moving the pieces around. A giant lesson was learned the hard way!
John Mann, President, Rolly Pollies International, Inc.
7. A Direct Mail Blunder
I bought a direct mail list for $5k without doing major research on the company, also purchased 10,000 postcards, and paid for bulk mail postage. Mailed out the first 5000 postcards and did not receive any inquiries, ouch.
Jenny Ford, President, Monkey-Toes
8. Paying Payroll Out Of Personal Account
I had the wrong bank account set up and paid an employee out of my personal account instead of the business account.
Janine Joi, Partner, Blue Sage Naturals, LLC
9. Not Getting Money Up Front
The biggest mistake I made as an entrepreneur is not to get money up front. I become a bill-collector, not a businessperson as a result and spend needless amounts of time following up on money owed. Dr. Linda Seger, Script Consultant (since 1981), Seminar Leader, Author
10. Not Researching Your PR Firm BEFORE Making A Commitment
Hired a PR firm based on their glowing pitch and promises without checking out their track record helping businesses like mine. $15k later, piddlling results.
Mike Van Horn, President, The Business Group http://www.businessownerstoolbox.com
11. Not Proofing Carefully
One of the first print jobs I did was a set of inserts for a folder. There was a lot of copy, and I missed one typo and ate the cost of reprinting the job. I now have at least 3 people proof whatever goes out!
Rickey Gold, Pres. Rickey Gold & Associates
12. Doing Business With Family
I made the mistake of partnering with a member of my family. Not always a good idea! And being a newbie at business, I didn’t understand the value of outlining roles and responsibilities to the tee, to make sure if someone’s not pulling their weight, there’s something to refer to IN WRITING. I have since learned the error of my ways and found a different partner, and we’ve documentedeverything in detail!
Melanie Heywood, Founder and CEO, Listasaurus
13. Not Prepared With Clear Deliverables
Not having clear deliverables in writing before beginning a project. As a result there was a lot of ambiguity and my client and I had very different points of view. In the end, it was just a case of having different expectations. We ended up parting ways and neither party was happy.
Danielle Luffey, Managing Partner, DVA Brand Communications
14. No Separation Agreement
Three of us went into business together and formed an LLC. However, when creative differences caused us to go our separate ways the lawyers made out to the tune of over six figures between us. And, friendships were ruined! Always have a prenuptial for the unexpected.
Mark Smith, Founder, iKids Play (the next generation of the business)
15. Not Understanding A Lease
I signed an expensive lease without knowing the meaning of “triple net” or considering what might happen if sales dried up.
Charleen Larson, CEO, JC Earrings
16. A Costly Mistake Dealing With In-Laws
Trusting a Father-In-Law to pay me back for equipment. In 2005, I purchased a significant amount of Equipment from my then Father-In-Law and by doing so it forgave over $85,000 that was payable to a vendor. I took on the debt by adding it to my financing. He was going to pay “above” market rent to pay it back. Guess what? It didn’t happen. The equipment was eventually stolen, therefore sticking me with used equipment that was financed 100% but worth only 50% of the financed value. NEVER trust anyone when you are in business, even family.
Jim Hovey, President, JP Hovey Group, LLC
17. Not Reading Your Insurance Policy
Dealing by phone with an Insurance agent that I had known for over 15 years. I had purchased equipment and had called my insurance agent to insure the equipment. He did so and sent the paperwork 30 days later. I put the paperwork in a drawer and forgot about it. After a severe injury and not being able to work for 3 months, my equipment was stolen and therefore required a solid look at the policy. We later found out that he failed to list 2 of my companies on my policy therefore allowing the Insurance Company, CINCINNATI INSURANCE COMPANY, to deny my claim. My claim was for $450,000.000. The equipment was stolen in August 2006, the case is not yet resolved, the insurance company has not paid, goes to trial in January 2009. Lesson; Review your insurance documents very carefully and remember that 99% of Insurance Policies are written in the favor of the Insurance Company, make sure every detail, even misspelled names are corrected because it will come back to bite you. Oh ya, beware if you have a policy with Cincinnati Insurance, they are known to deny claims.
Jim Hovey, President, JP Hovey Group, LLC.
18. Not Speaking Up For What You Want
Prior to launching my astrology website, www.itsinthestarsonline.com in December 2006, I had booked a PR agency in October 2006 to generate publicity for Valentines Day 2007 for my LoveStars astrology reports for couples.
All was going swimmingly enough with magazine and newspaper coverage.
Then at 5.45pm on 12 February, my PR consultant rang me urgently to let me know I had an opportunity to be interviewed on a morning TV show, Mornings With Kerrie-Anne Kennerley the very next morning at 9am.
However, they wanted me to showcase six celebrity couples in their LoveStars reports.
Seeing as I’d be on for just three minutes, this gave me 30 seconds to sum up each couple which wasn’t feasible. Plus, I felt terrified at the idea of not being totally across all six couples astrologically-wise, having to research their birthdates and do their reports overnight and try to remember the salient aspects concerning each couple’s relationship. In other words, I was afraid of looking like a giant goose on national TV!
Rather than firmly tell my PR consultant – no, let them choose just one couple (such as Angelina Jolie and Brad Pitt) and I’ll happily discuss them in detail – I said no to the whole opportunity.
I have never been able to get another interview on that TV show.
Elizabeth Ball, Director, It’s In The Stars
19. Not Proofreading Biz Cards Before Printed
I approved the proof for my new business cards (with a new logo). I discovered that I transposed the telephone number an hour before I was leaving for a book signing event. It was very expensive to reprint the cards and rush delivery.
Ruth King, Founder and Chief Evangelist, Profitability Channel
20. Purchasing More Than You Should
One big mistake I made when I was starting out was letting myself be talked into purchasing more product than I wanted, to get the wholesale price I wanted.
The salesman at the distributor was much more experienced than me and pushed all the right buttons to get me to buy more than I should have. I knew how many I could sell in a reasonable time, and should have stuck to my plan, or left without any because I used up almost all of my capital.
To add insult to injury, two weeks later the product was in Target priced at what I paid wholesale.
Moral of the story, don’t be afraid to walk away from a deal.
John Schulte, President, National Mail Order Association (NMOA) Author, Direct Marketing Toolkit
21. The Copy For Your Marketing Is Unclear
I was asked to write a book, about how I have helped companies grow rapidly . Most companies I have helped did branding backwards. So I wrote my book and called it dnarb’s journey , as Dnarb to me was obviously the word Brand spelled backwards. After 30 days no free downloads, I reached out to the market and asked why. Quickly I changed the name of my free book to branding backwards, and within 4 months 4,000 people downloaded my free book designed to help businesses understand branding and positioning. You can download a copy at www.outbsolutions.com
Mark Roberts, Managing Director, Pragmatic Marketing
22. Making Too Many Promises
I made too many commitments to appear in front of live audiences and had to re-negotiate where I would appear live to present my workshops or keynote It was the “thrill” of being booked to speak that caused me to mis-judge how much I could accomplish in a month.
Amy Dorn Kopelan, Co-Creator of The Guru Nation
23. Basing Company on Non-Important Ideas
I made a big mistake by basing my production company on movies that put the audience to sleep. Turns out nobody knows/cares how much good it does them. I was really proud when the LA Times called WebcamMurder.com “the most boring talkie ever made,” yet it didn’t make a blip in sales. So I’ve decided to broaden my business. My new movie, Sublime Crime: A Subliminal Movie, puts the audience to sleep better than the first one because it’s mostly a blank screen, but with the added advantage of brief flashes of plt and positive affirmations that will make people feel better about themselves when they wake up. I am hoping this is the ingredient that will turn my business around.
Sondra Lowell, President, Film Sleepy Inc
24. Trying To Get Rich Quick
My two biggest entrepreneurial mistakes were trying to get rich quick and not creating a business that helps others. When you chase money, the quality of your product or service suffers. And creating a venture that doesn’t help others is a selfish pursuit.
Andrew Galasetti, Founder & Editor, Lyved.com
25. Thinking You’re A “Special Case”
Even though I taught business plan classes for those seeking funding, I thought that I didn’t need on. Finally creating one .. using the One Page Business Plan ® program really helped my business.
Maria Marsala CBC, Chief Strategy Officer, Informational Speaker, Author www.ElevatingYourBusiness.com
26. Trying To Do Everything
I tried to do everything myself instead of hiring help. For example: I wrote features, did the layouts, updated the mailing list, did the bookkeeping, updated the website, etc. I was spread too thin and wasn’t doing any of it well. It would have been worth the money it cost to hire help in order to have the extra time to meet my publishing deadlines.
Cindi Leeman, Editor/Publisher for WALK Magazine
27. Thinking Manufacturing In China Was Better
I grew up surrounded by industrial emblems in my father’s uniform company. While my dad was focused on acquiring new business with police departments and security companies, I was determined to find a way to make the goods in his warehouse fashionable.
Upon launching in Jan 2003, my company made headlines when Jennifer Lopez celebrated her engagement to Ben Affleck by getting “Ben” name patch thong underwear (you know those same name emblems that gas station attendants wear) It was the height of the “Bennifer” phenomenon so People Magazine and The Today show were happy to report the sexy scoop. Boom… Blume was up and running… the orders were piling in faster then the seamstresses could sew.
So how does a social worker, turned actress, turned panty designer figure out sourcing for her new clothing label? Well, at first that was easy… a domestic company called American Apparel –a wholesale supplier. American Apparel is certainly a key component that provided me with a large variety of ‘bodies’ in an array of colors that could be purchased one case or even one dozen per style, per size, per color… fantastic! As a small business owner and designer, major hurdles of cash flow and manufacturing were solved.
But as a company grows, so do their options…. and thus the overseas market was enticing. Once the company had grown to a point where we needed to manufacture 40,000 thongs at one time, it just seemed to make more sense to do so for ½ the cost in China …. Or does it??
The first time I attempted to work with a Chinese factory, the language barrier was a big obstacle. So then I contacted a broker/agent as an experienced middle man who could communicate what needed to be done. There was a lot of back and forth. Every detail needed to be approved… the weight of cotton, the colors/ lap dips, style/cut, elastic waistband stretchy enough for a range of women’s hip size, inside labels soft, outside labels… clean white with the strong bold red Blume label. Seems easy- right? But, no such luck. The elastic bands that make the Blume thongs s/m fit women size 0-6 did not stretch at all. Ut oh! Thousands of thongs all ready to get personalized with their name patches had to be returned.
So back to the drawing board, and I tried a third time with a different agent. Once again everything seemed to be going smoothly; after 4 months of another detailed approval process, tens of thousands of thongs arrived at the Blume headquarters warehouse. But it was like a scene out of a nightmare Christmas. Upon opening box after box, it was clear that the thongs were all wrong. Too thin and flimsy and worst of all they were teeny tiny small! Like the size small/medium was more like a negative zero! Nothing like the original sample approved– the difference was very visible. It is like the case of the incredible shrinking thong. (photos available)
Although, the savings would have been significant, I am not willing to risk the quality of the Blume brand and therefore I have made a commitment to stick with my original domestic manufacture- and leave the nightmares of manufacturing overseas behind for good.
Stacey Blume, Blume
28. Not Being Clear With Your Companies Name
I designed my business name using my last name thinking it was clever. Huntingtax when my last name is Huntington. I didn’t consider the fact that new clients or even clients who don’t know my last name would wonder what in the hell Huntingtax meant or was. Clients always just say or use Huntington tax accounting or Huntington accounting instead of my actual business name “Huntingtax Accounting Services”.
Kristi Huntington, Owner, Huntingtax Accounting Services, Inc.
29. Underestimating The Companies Growth
When I began a previous start-up, I underestimated the company’s growth and had to move four times before I finally leased too much space.
Blake Squires, Founder & Chief Strategy Officer, Findaway, makers of Playaway®
30. Working Without A Signed Contract
Hungry to grow my consulting business, I agreed to work without a signed contract for what promised to be a long-term relationship. The client worked me to death –far beyond my retainer hours limit and then dropped me as soon as his big project was done. What a bargain for him. What a lesson for me.
Joyce Wilden, President, Buzz Biz Public Relations
31. Investing Too Much On Self-Promotion
Investing too much money on self-promotion. When I started my agency, I went out and spent a ton of money on mailers, I did custom photography and invested the time to design and print a beautiful piece, but in the end it directed recipients to my website, which really didn’t have anything substantial on it at the time to get clients interested. In hindsight, creating a much simpler mailer, would have been so much smarter and would have gotten me the same results.
Jordan Mauriello, Founder & Creative Director of moreYELLOW
By Mike Michalowicz, Author of The Toilet Paper Entrepreneur