Starting your own business is one of the most exciting things that can happen in your life. As you set off into the world of entrepreneurs, you depend on enthusiasm and passion for getting you through all types of hardships. However, both enthusiasm and passion can be a boon and a bane for entrepreneurs. If you don’t think about your actions and decisions, you may drive your company to financial and operational ruin. While there is no foolproof plan on how to start a business, knowing the several common mistakes that new business owners usually make that can have a devastating impact on the company, will help you to avoid them. Here are five common mistakes that can be detrimental to your startup:

Choosing the wrong team

Picking a team for your business is like selecting who to play with for a basketball tournament. While you could pick your friends as your teammates as you are comfortable with them, it isn’t necessary that you will succeed and win the tournament. To go far in the tournament, you would have to have a strict selection process so that you get the best players for your team. Similarly, for businesses, it is important to have team members who have varying skill sets. They should also share common values and have trust in other teammates when the company is going through troubled waters. 

Only planning for success

All entrepreneurs dream of making it big in their respective fields. However, due to unpredictability in the business world, not everything will go according to plan. To be successful in the business world, your company should have flexible processes and contingency plans in place. This way, you will be in a better position to deal with things as you face them. 

Not setting up a business bank account

Using your personal account for your business can lead to confusion if you aren’t careful. Also, the tax department will investigate your account as it looks suspicious. The best option is to have separate accounts for your business. Banks also have different terms and conditions for business accounts which are beneficial to your company. It will look more credible and professional when you write checks with your business account.

Failure to check legality of your business name

This is one the most common mistakes made by entrepreneurs. They fail to check if their business name has been taken by someone else. Infringing on another business’s trademark will land you in a lot of legal trouble. Don’t go around creating social media pages, marketing campaigns or business cards without checking the legality of your business name. 

Inaccurate pricing of products and services

Most entrepreneurs have no idea on how to price their products and services. They either come up with an approximate value or they base the price solely on what their competition charges. It’s extremely important as an entrepreneur to have solid information about the actual cost for each product and service. This will help in finding out the actual cost of production. You will also be able to make adjustments in pricing accordingly.

Making mistakes is a part and parcel of life. The most important thing is to be aware of what they are so that you can work on them. Ultimately, you will be able to build a successful business by learning from your mistakes.

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