Professional Business Plan Specialists

Reach new heights

News And Articles

5 Common Pitfalls To Starting A New Small Business

5 Common Pitfalls To Starting A New Small Business

Table of Contents


There are several reasons why entrepreneurship is a popular choice. From being your personal boss to creating time for yourself to name a few. It’s no surprise that more and more people have selected to start their businesses. Although starting a small business is a new exciting step for every new business owner, it can also be an overwhelming and stressful experience. New business owners face many new challenges in the first years of owning a business, and it is not surprising that many companies fail during this initial period. As a new entrepreneur, it is essential to take a proactive approach to prevent potential pitfalls from increasing your chances of success. Aside from entering a new industry and not knowing how the market works, there are other common mistakes that can lead to failure of your small business.

Here are some of the most common pitfalls to avoid as a new business owner:

#1 Poor Planning Strategy

When starting a business, it is crucial to understand the importance of a business plan and how it can contribute to the success of your business. Without having one, you may find yourself shooting blindly in the dark. It is essential to establish your business’ vision and mission. It is also vital to create a detailed analysis of specific aspects of your business, such as your financial forecasts (this should contain your budget, employee salary and other expenses). Due to the lack of proper planning and preparation, some small businesses eventually fail as early as the first few months.

#2 Inadequate Funds

One of the biggest financial mistakes you can make as a business owner is establishing your business while not having adequate funding. Since a newly-opened business will not immediately bring in a profit, money will be a necessity to support its daily operations. As a business owner, you will incur significant costs when paying for the necessary licenses and permits, equipment, supplies, employee salaries, and legal fees and taxes. Not having enough start-up funding is one of the most common reasons half of all start-up businesses fail in the first five years. To ensure the success of your business, make sure that you have enough funds that can act as a support system when your business is at its weakest point. Thus, before starting your dream business, it is advisable to assess your needs and secure an adequate amount of cash that will be able to keep your business running until it’s already providing you with stable Return on Investment.

#3 Ineffective Marketing or Promotion

In today’s fast-paced market, it is essential to keep up with the competition to avoid failure. Thus, developing an effective marketing strategy is necessary to run a successful business. With the recent advances in technology and social media, which provide effective marketing platforms, successful marketing campaigns can be launched even on a small budget. Creating a good marketing strategy will help your business reach its target audience and cater to your customers’ needs. Starting a new business is full of surprises. As a new entrepreneur, it is crucial to be aware of the peaks and troughs of the process to increase your chances of success. Managing a business, regardless of size, has its challenges.

#4 Forgetting about Social Media

There may be no denying that social media has become essential for every business. Whether it’s Twitter, Facebook, Instagram or Pinterest, the truth is that every network has validated to be an excellent conduit and has supplied tremendous benefits for businesses when it comes to increasing third-party endorsements, improved sales, and added exposure. There are now several free online social media courses designed to aid entrepreneurs build their businesses. Sites like Udemy, Khan Academy, and Cousera may be invaluable.

#5 Not Willing to Delegate

As an entrepreneur, you may feel compelled to take on all duties and micromanage every aspect of your business. This could be very difficult to manage, and you may end up making more errors than not. Sure, you want to understand the demands and intricacies of your business; however, you may want to create a work-life balance. This means you want to delegate work to your employees or, if you are a sole entrepreneur, to trusted suppliers to lighten your load and offset the worries you may have. Why try and create your own website if you don’t have the skills? Or create logo if you are not creative? Sites like Fiverr, and Freelancers can provide assistance.

Established in 2006, we have successfully written more than 12,500 Professional Business Plans for clients across 25 countries. As South Africa’s Leading Business Plan Company, we are confident that we would be able to assist you too. Kindly note that we also offer “Investor Pitch Decks”, “Excel-based Financial Models”, and “Proposal/Tender Writing Services” in addition to our Custom Business Plan Writing Service. Please visit our Services page for more information.

We look forward to being of service to you. Please feel free to contact our Founder, Dr Thommie Burger, on +27 79 300 8984 should you have any questions. He is also available via email and LinkedIn.

JTB – Your Business Planning Partner.

Share this article…

Share on facebook
Share on twitter
Share on linkedin
Share on whatsapp

Recent Articles

Business Plan

The Business Plan and 4 Superb Philosophies when Writing One

Creating a new business is a process fraught with difficulty and failure and many businesses fail in the first twelve months of trading.
Most businesses operate in competitive markets: They have to compete against and out manoeuvre competitors in order to answer the question of how they will gain market share and establish a competitive advantage. Not all organisations arrive at the same answer and for good reason.


Buying a Business vs. Startups: 12 Possible Reasons Why One is Better

Before I start off, let me be upfront by saying, 99% of would-be entrepreneurs out there do not have the funds to buy an existing business. But, in an ideal world, if you do have the funding available, it would be worthwhile to look at the reasons why buying a business is an easier path to becoming your own boss than starting from scratch. So why should you buy a business versus start your own?

Investor Questions

Investor Questions – 10 Critical Questions You Will Be Asked When You Seek Funding

Investor questions are dreadful to new startups. Entrepreneurs need to be prepared when pitching their start-up companies to investors by anticipating the questions they will receive. Presenting to potential investors will involve as little as 10 questions and as much as 100 questions. We have focused on the Top 10 Most Common and Most Difficult Questions that entrepreneurs can expect when presenting their Business Plan.

Startup funding

Startup Funding and 8 Costly Mistakes to Avoid

Startup funding is perhaps the greatest challenge to new companies. Startup companies are faced with many challenges, and one of these are securing funding. Securing and managing funding can be one of the most exciting – and nerve-wracking – parts of being an entrepreneur.

Subscribe to our newsletter.

Stay informed and opt-in for our newsletter via email. We respect your privacy and we never spam.