Three amateur business mistakes you should avoid

Starting a business is an exciting time. You’ve gathered experience, you’re passionate, and you want to leap right in. But before you jump into the deep end, make sure to avoid these three mistakes.

Don’t charge too much or too little

One of the biggest mistakes inexperienced entrepreneurs make is not knowing their worth. They either get nervous and undercharge clients, or guess and overcharge. Both can be damaging to your business, and here’s why:

Overcharging

If you’re accidentally overcharging you may struggle to find customers and clients who are willing to pay. They may also have higher expectations: if you underdeliver you’ll end up with unhappy reviews.

Until you’ve established yourself, it’s wise to charge around the industry standard.

Undercharging

You might not realize just how damaging charging too little can be. I’ve spoken to people who say they’ll charge less than their competition until they’ve gained experience and confidence, and many of them end up broke.

Others simply don’t realize how many overheads are involved in running a business! After all, you’ll need to earn more than just your wages.

You need to pay tax, rent and overheads, and put money aside for equipment and other unexpected costs. In addition, you’ll need to charge for time. Some projects will take longer than others, and charging everyone the same fee could leave you struggling.

Start off too cheap and you also run the risk of losing clients and customers when you inevitably raise your prices.

Don’t undervalue yourself! A great tactic when it comes to pricing is finding out the industry average. How much do other businesses and people charge for their time? How does the quality of your work compare to theirs?

If you’re producing work of a similar standard, you deserve to charge, and therefore earn, as much as they do.

Don’t wait until you have better equipment

A few years ago some friends of mine decided to create YouTube tutorials. Some of them grabbed their smartphones and got stuck into creating, and others spent months deliberating because they wanted top of the line cameras.

Here’s what I observed: those who jumped right in thrived. Most of them earnt enough to organically upgrade their equipment. And while the others were hesitating, my smartphone friends were already building their businesses.

Right now you probably have all the tools you need. You might not have the highest quality equipment, or the slickest packaging, but it doesn’t matter.

You have a product or a service you want to show the world.

Many of the biggest businesses started off shipping their goods in brown paper bags. They handwrote addresses, and they took product images on their phones. A lot of them started in garages, in living rooms and in student dormitories.

If you’re hesitant to begin because you haven’t got the polished look your competitors do, relax. They didn’t start off polished either.

Don’t let nerves bring you down

People strike out on their own for all sorts of reasons. They come from diverse backgrounds, with all kinds of experience. Some are seasoned professionals, and others are straight out of school. But there’s no checklist when it comes to being an entrepreneur: if you have a dream and the focus to pursue it, you’re in the club.

That said, starting a business can be a stressful time. You might doubt yourself and your products, you might question if there’s a place for you, and you might find yourself endlessly comparing yourself with others.

There’s no easy fix, other than to remember that successful entrepreneurs have come from everywhere. You’re never too old or too young to introduce revolutionary ideas into the world.

The best advice I can give you is to stick to your purpose. Why are you pursuing what you’re pursuing? Whether you want to create something entirely new or improve on existing products, keep your reasons in mind. No matter how much you worry, stay focused on the Why and it’ll lead you in the right direction.

The key thing to remember is that everyone has to start somewhere. So figure out your pricing, start with what you have, and stick to it. With a little elbow grease, there’s no reason you can’t reach success.

- Lena Klein