Several myths related to small businesses are well nurtured by people and eagerly passed on to new entrants. However, to run your business confidently and successfully, you need to have clarity in your mind and not get confused with these false notions.
1. If you are a start-up the Government will provide a grant
There is no blanket assistance or grants that the Government provides to start ups. There are special assistance programs which offer grants to small businesses selectively. You need to find out if your business is eligible under these schemes.
2. Venture capitalists will invest in any start up
Venture capitalists are not bound to provide money to start ups. They invest money in equity and become partners at their discretion. Venture capitalists would primarily invest only in those start ups that have an intellectual property driven business and have the potential to scale up and yield extraordinary returns.
3. More time to enjoy life with family and friends
The best part of having your own business is that you can be your own boss. But remember this does not mean you have the luxury of time. Since it is your own capital that you have invested you will always have to be on your toes. Unlike a job your role is not limited to your post, but rather extends to all organizational functions.
4. Personal expenses can be accounted in the business
If you think you can evade taxes by putting all your personal expenses into the business, you are mistaken. The Income Tax department is very vigilant and knows it all. In most cases they will be able to find out if you have done so.
5. You just need a few months to make your business profitable
Businesses are like new born babies and you need to nurture them before they learn to walk on their own. In most cases it takes time to set up a system that will run efficiently enough to generate sufficient revenues so as to become profitably. A two year waiting period is generally expected for businesses to be profitable.
6. The product is good so it will sell on its own
If you have a good product, it is only you who know it and would be interested in telling others about it. So no matter how good your product may be, you need to have a marketing plan ready to ensure that all your potential customers know about it. Even if they know about it, you need to convince them to try your product and experience the benefits.
7. You need a business plan only to raise funds
A business plan is not just about sharing with investors, but it also guides you on two things. First of all, it tells you whether you should go for the business at all. Besides, it helps you envisage how much you would need to invest to run the business profitably.
8. Small businesses will be litigated for not providing health coverage
Businesses are not required to provide healthcare coverage until they achieve minimum employee strength, which is generally a large enough number. So most small businesses are exempt from the compulsion to provide healthcare coverage to their employees.
9. Coining a name for the company does not require external support
Coining a name for your business is not just about what you like, but it should also be what would appeal to your customers. There are legal aspects as well as the name that you chose should not infringe upon somebody else’s trademark. So hire an attorney before you finally coin a name.
10. You can secure your personal assets by incorporating
Incorporating your business does cave a separate identity for your business which has its own set of assets and liabilities. However, this does not mean you can always protect your personal assets. In many cases, while running your business, there will be situation wherein you will have to sign documents giving a personal guarantee.
11. Social media is the success mantra
Being on the social media is important but you need to be conscious about the fact how much time and money you are spending on it. Social media is just part of a larger marketing strategy. You need to consistently evaluate whether your social media campaigns are going right and delivering the desired ROI.
12. Spend more money to make more money
Just spending money does not ensure profits. While your business is young you not only need to prioritize your spending but also see whether the resulting benefits justify the amount spent.
13. Passion is all what you need
No doubt you need to be passionate about your business, but let your passion not turn you blind about the market dynamics and changes. The strategy that you envisage has to consistently undergo change depending upon how the market responds.
14. A business degree is important for you to succeed as an entrepreneur
The best part of doing a business is that you do not need credentials or degrees to take it up. It just requires a will to do and a passion to succeed.
15. There is a good chance that your start-up will fail
Although numbers would suggest likewise but you need to realize that start ups need to be supported for a longer time before they start to deliver. So one of the essential elements required that will help you succeed is an ability to continue despite the setbacks you may receive.
16. If you are small you need not register your business
Most people who have just started up do not feel the need to register, but no matter what is the size or age of your business registering your business is mandatory.
17. You have to offer the lowest price in order to win over competition
Customers are not always seeking the lowest price for products. To find a place for your product in the market all you need to do is differentiate and position it accordingly. Depending on how well it fits the market needs it will generate revenues accordingly.
18. Cash flow is a constraint
If you are doing things correctly there will be people to provide you the resources. If you find your business constrained for finance, do an internal check if you can do something to improve cash flows. If there is no scope you can seek external funding form friends or financial institutions.
19. The larger you grow in size, the better it is for the business
Growing your business is important and essential but you need to ensure that the systems in your organization are geared up for the same. More importantly, market where you to intend to grow should be ready to absorb your supply.
20. Do not take risks
Most businesses fail not because they play it safe but because they don’t take the desired bets and risks. Not taking any risks is the biggest risk for a start up.
About the Author: Boni Satani is an online marketer associated with Zintel Communications – Australia’s leading toll free number solution provider. Zintel empowers small and large businesses to offer great customer experience.