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The 7 Most Common Mistakes Local Business Owners Make

Here’s how to avoid the most common mistakes made by local business owners.

The Future Is Made Of Mistakes!

1. Managing Time Poorly

The first online marketing company I built is named “Kala Digital”. Kala means “time” in Sanskrit, one of the oldest languages in the world.

The reason I called the company “time” is because time is people’s most valuable asset. So it made perfect sense to call my company the same.

What most local business owners don’t realise is that how they use their time will determine their long term success or failure in their business. Most importantly, using time correctly will allow you to set yourself free from your business over the long term and do more things you enjoy, such as:

  • Spending time with family and friends
  • Travelling
  • Going Fishing, Kiteboarding, Shopping (or whatever hobby you enjoy)

So how do you increase your time efficiency in your business? When you are starting out, I would advise that you outsource nearly every item in your business that is not your core function. What do I mean by core function?

I mean the following:

  • If you are not a bookkeeping business, outsource your bookkeeping
  • Outsource payroll
  • Outsource administration tasks. Filling out forms. Preparing sales contracts. Sales meeting preparation. Develop systems which ensure other people (whose time is not as valuable as yours) can do all of these tasks for you.
  • Outsource marketing. If you are not a marketing agency, you should outsource your marketing. As a caveat to this — I would highly encourage you to read everything you can get your hands on around marketing and sales. You won’t be able to hire a great online marketing agency if you do not have a base knowledge of marketing or online marketing, and you may become susceptible to shady sales pitches. This could mean the difference between success or failure in your business.

On the contrary, what I would maintain control over, in the beginning, is sales and customer service.

The better you are at sales, the more likely you will have outstanding success in your company. Further to that — when you attend to customer service queries, you can see where the gaps are and where your customer satisfaction can improve. Consequently, you can increase the amount of referrals you receive and may get large hints as to what systems to build next to wow your customers.

Talking to customers is absolutely vital, and that’s why I think you shouldn’t outsource sales or marketing in the beginning.

2. Not Installing A CRM Software (Customer Relationship Management/Marketing Software).

It amazes me how many companies I see that don’t implement some kind of Customer Relationship Management tool from the beginning.

Some local businesses even operate WITHOUT a basic SPREADSHEET. I find this madness.
With content marketing playing an increasingly important strategic role in local business online marketing, it is vital to have some kind of automated content marketing system.

Content marketing is a whole other topic for another blog, but it’s very important you understand that it’s becoming more and more important and that you should never allow your business not to have a system to track and maintain leads.

3. Underestimating The Importance of Sales and Marketing

One of the first books I ever read was Rich Dad Poor Dad by Robert Kiyosaki. It fundamentally changed the way I viewed the world. So much so, that I immediately dropped out of University (College) and started my entrepreneurial journey. At this point in my life, I was studying Accounting and was painfully shy.

The book said one main thing that has stuck with me forever. You need to learn to sell, and you need to be the best at sales and marketing in your company.

So I did as the book instructed and immediately went and got a sales job, which was still to this day the hardest job I have ever done. It was full commission (if you didn’t sell, you didn’t get paid). It involved knocking on 240 strangers doors per day and trying to sell them a telephone plan. And this is how my entrepreneurial journey began. At this stage, I wished I could go back to College/University …haha! Studying was easy compared to being faced with constant rejection.

But I stuck to the process and learnt how to sell. All the time while I was doing this I was devouring books on marketing.

Today, as I run my company, I see my sales and marketing as the primary success factor of my company. It’s that simple. Robert Kiyosaki is right: Sales = Income.

The moral of the story is this: you must make the effort to learn sales and marketing. If you do, your business will thank you for it, and so will your life.

You can start by Googling the Consultative Sales Approach and any books by Jay Abraham. You will get some of the best information on both topics by taking time to study the above.

Be the best you can be at sales and marketing, and your business will flourish.

4. Not Having A Strategy

Most business owners fail to make a strategy. Sun Tzu once said, “Tactics without strategy is the noise before defeat”.

When local business owners start their entrepreneurial journey, they usually fall into one of the following categories:

  • They don’t want a boss anymore
  • They want to control their own destiny
  • They think they can “do it better”.

At none of these points does strategy cross their local business owners mind. I can tell you unequivocally that the first thing I would do when entering ANY business, is craft my strategy. I would start doing this by dissecting my competitor’s products and services and understanding their value proposition in the marketplace.

I would look at what they are offering, and figure out how I could do it faster, more efficiently and with more quality. I would figure out what the customers really wanted, and build my entire value proposition and marketing strategy around the primary concerns of the customers.

A strategy allows you to win. So you better think long and hard about it.

5. Taking On All Work Offered By Customers.

This was one of the classic mistakes I made when growing my first company.

At first, we were a website design firm. Then I started doing consultancy work to supplement my income. Then my customers were requesting graphic design. Then they were requesting Linkedin marketing.

I said YES to it all! I thought that saying yes to it all would lead to more and more business and more and more opportunities. What I failed to understand was that we were fast becoming masters at nothing! And we couldn’t build the systems required to produce consistently great products. And that’s essentially what a business is: a system that produces cash flow.

Just imagine a system that produces oil one day – it cannot be used to produce beer the next. It’s inefficient and doesn’t make sense. It’s the same with your company.

So here’s my advice… START saying NO. Once you do this, you can focus on building systems and recruiting people to run them. By doing this, you will build an asset that you will be able to sell in the future.

6. Not Setting Up Systems From The Beginning Of Your Company

A business is a system that produces cash. So take a guess what you should be working on from the beginning of your company? You guessed it. Systems. You need to work on systems for the following aspects of your company:

Sales Systems:

What are your value propositions?

What will your sales team (you in the beginning), say to the customer when you go on sales calls?

What questions will you ask?

How will you showcase your products and services? How will you present value?

Marketing Systems:

What mediums will you choose to market your company in?

What is your unique selling proposition?

How will you market your company better or different to your competitors?

How will you track the success of your marketing?

What are the most important statistics you want to track to determine the success of your marketing?

Finance Systems

How will you track your cashflow?

Who will do your invoicing?

How will you chase up your debtors?

How will a sales order go to finance without your involvement (if you have a sales team)?

There are LOTS more systems and questions involved in setting up each of these areas of your company. But the most important part to remember is this: the longer you leave setting up systems for your business, the LONGER YOUR BUSINESS WILL ENSLAVE you.

The key to removing yourself from the equation of your company is to set up great systems. This will enable you to, over the long term, get back most of your time and you will then be able to spend more time on the things you love to do.

7. Not Understanding This Fundamental Truth.

There’s one fundamental truth to growing every company.
It is this — “there are only 3 ways to grow a company”.

  • Increase the amount of new customers
  • Increase the average order size of those customers
  • Increase the frequency of purchase of those customers.

EVERYTHING in your marketing should have one of these three objectives.

Within each of these three items, there are many ways to grow your company. But understanding this fundamental truth is a great start to see the simplicity of business, once you understand it.

So there are the seven most common mistakes that most local business owners make when building their companies. I wish I knew these when I began, so I hope you can benefit from this knowledge to help you grow and systemise your business faster!



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