I've met hundreds of SMEs and business owners… I've seen some rise and I've seen some fall. Some have gone on to have massive success on the international stage, and some are not doing too well. Some are attracting investor interest, and others are contemplating shutting down their business completely.
Business is no laughing matter. Here are some mistakes I've seen business owners make, along the way.
Mistake 1: Cutting corners where it matters
To survive, a business needs to keep their costs in check. For example, does a company really need a permanent office space that costs $7,000 a month in the CBD when it first starts out, and has zero visiting clients, when it can get a co-working membership for a fraction of the price? Of course it doesn't.
An office space may be negotiable but some things are not – and that is when it affects purchasing decision of its customers. For example, having a professional website is non-negotiable in this day and age, customers literally judge the reputation of a company through its website.
There are also other mistakes that companies do which do not reflect a professional image – in the B-to-B industry, this is especially important, especially when dealing with large corporates who are evaluating whether to spend tens of thousands of dollars on your company. If you don't invest in your company, clients won't invest in it too.
Mistake 2: Not investing in staff
I have also seen some SMEs who think too much like a small company, like they will never get bigger. For example, some companies don't invest time and money to attract the right staff, when they have zero hiring skills and have never done it themselves!
So they just count on a referral. While this is okay for a part-time job – for example, a part-time drinks server – it is riskier to look for a highly-skilled person just through one referral, just to cut costs – for example, SMEs who hire, without much thought, the friend of a cousin's neighbour's sister.
After one interview. Without interviewing anyone else. Without doing a background check. How do you know you didn't just hire a serial killer? Just to save time and costs of putting a job ad that may cost a few hundred dollars to attract hundreds of applicants.
To me, this doesn't make sense – if you are going to spend $3,000 on your new staff, shouldn't you spend the $300 or whatever amount on a job ad to make sure it's the right one? I've seen SMEs offer very low pay, and zero benefits, when SMEs should be doing more – not less – than MNCs to attract good talent.
Mistake 3: Not keeping up with the times
Technology is changing very, very quickly. What used to take hours now can take minutes. There are so many technological developments which have made it easier, and cheaper for a company to run their business.
I personally use Virtual Assistants overseas (versus spending over $2,000 on a PA here), at least seven daily apps to boost productivity, and I spend at least an hour a day catching up with all the tech news, apps and business news, that can impact our business.
Not keeping up with the times can be a missed opportunity. For example, Social Media has made it exponentially cheaper for companies to advertise. Companies used to have to spend thousands of dollars on an ad, without ever knowing how many people would come into their store after they saw the ad. These days it can cost as little as $5, and you can track the ads to see if it actually resulted in website traffic.
Business owners should keep up with the times as technology is changing and improving how we do business.
Mistake 4: Having no one accountable for sales or marketing
This is a really big one – and one I've seen the most. Some companies have a salesperson, some companies have a marketing person. Ideally there should be a salesperson and a marketing person working hand-in-hand. But some companies don't have either. And the business owner won't hire someone to do it, or do it themselves. So there is no one actually working on it!
Some companies also make the mistake of thinking sales or marketing can be done by any type of person, with the wrong kind of skills to do this – for example, an admin person, a secretary, an intern with zero experience. Not only will this person hate their job as it wasn't the job skill advertised – chances are, they would probably be not very good at it.
If you had the flu, would you go to a doctor, or trust that a random friend could cure you? Similarly, a salesperson or marketing person can't be just anyone.
Sales is the number 1 thing that helps keep the company going, pays the salaries of the staff, and determines the ultimate success of a company. A business owner's refusal to hire a salesperson could lead to zero sales, and having the wrong kind of marketing can lead to a PR disaster.
So what do you do if you can't afford a sales or marketing person? Well, there is only one way: do it yourself. The best businesspeople I've seen are good at sales and marketing themselves – they're the ones who can communicate their idea, negotiate their contracts, and influence a favourable outcome, no matter what the circumstance.
So if you don't have the right skills, then learn. The internet is a fantastic and free resource! Or invest in yourself and get some professional training. Attend a sales talk. Hire a marketing coach. There's so many things you can do to upskill yourself.
Okay, so here's a mistake I made myself…
I have gone on long enough about mistakes companies make. I have made many myself – one mistake I made in the first year of business was trusting an email service that came free with a particular web package I purchased. I thought, "Hey, it's free! I'll just use it!" without reading customer reviews or doing my research.
It turned out that this service was unreliable and I actually did not receive over a dozen emails from various clients! Imagine that. Hundreds of dollars of missed opportunities because I wanted to save $50 a year.
That was a good lesson learned – don't be cheap! And always be suspicious of freebies.
What are some business mistakes you've made?
The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by Singapore Business Review. The author was not remunerated for this article.
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Liyana co-founded Anagram Group, a corporate training company serving government agencies and MNCs. She is also Founder of Anagram Communications, and provides communications and marketing counsel to SMEs and high net-worth clients. Liyana also co-founded LadyBoss Asia, a website and portal for female entrepreneurs and leaders. Prior to Anagram and LadyBoss, she was Head of Communications for Singapore's largest foreign business chamber, and Content Editor of Singapore Business Review.