Operating a small business is something many people dream about because they associate it with flexibility and freedom. However, the reality of running small businesses is that they’re subject to many of the same risks and challenges other companies face on a daily basis. In fact, there’s a distinct disadvantage tied to the feeling of being able to do just about everything on your own. This can be a careless approach to doing business and should be avoided. With this in mind, here are five things you shouldn’t do when running a small business.
1. Fail to Create a Business Plan
Many small businesses fail because owners don’t take the time to create proper business plans. It takes more than simply having a vague idea of what you want your business to do. Success requires looking beyond the ideas, creating a plan, and using it to guide your business as it grows. Define precisely what your business will do, identify your customers, and set goals that measure your progress.
2. Do It All Yourself
Many small business owners make the mistake of trying to do everything on their own. This not only takes up all their energy but also takes valuable time away from doing the things that will grow the business, such as marketing. Instead, small business owners should outsource some tasks so they can focus on growing their businesses. Although this will add to the amount of business expenses, delegating some tasks will ultimately pay off in more time to devote to business development.
3. Forget about Time Management
When you’re the person who’s responsible for the business, it’s easy to fall into the habit of blurring the lines between work and other important aspects of life, but it’s essential to establish clear boundaries. Along with the temptation to work longer hours, you may also be tempted to skip meals, forego sleep, and put off physical fitness activities. These unhealthy habits may quickly become routines that ultimately negatively affect your ability to make sound decisions that keep your business growing.
4. Fail to Pay Taxes
The Internal Revenue Service offers quite a few incentives and tax breaks to small businesses, but you must make sure your business meets the criteria to take proper advantage of these financial benefits. According to business news magazine Kiplinger, the odds you’ll be audited by the IRS are less than 2 percent. However, you don’t want to leave things to chance.
5. Ignore Liability
Running a small business may give you a false sense of security that could lead you to disregard the need for adequate insurance. Granted, you may not need certain coverage. For example, if you’re a self-employed accountant working from home and your business model doesn’t involve inviting clients to your home office, you may be able to skip premises liability coverage. However, there are other types of business insurance you’ll likely need, such as professional liability insurance, which helps business owners recover costs incurred if errors or omissions are made in the services or goods the business produces, and general liability insurance, which covers claims for false advertising, property damage, and personal injury. Make sure to check with a commercial insurance agent about the coverage that applies to you.
If you’re a small business owner, make sure to protect your business by purchasing the right insurance coverage. For affordable, reliable business insurance as well as homeowners, renters, motorcycle, and auto insurance, San Diego residents call on the trustworthy professionals at Altra Insurance Services. Reach out to us today at (619) 404-6311 to learn how we can satisfy all your insurance needs.