Starting a Business For Dummies, 4th Edition

Chapter 19

Ten Pitfalls to Avoid

In This Chapter

Making sure that you have the right skills base

Keeping track of key financial data

Staying out of the failure statistics

Difficult times can cause even the biggest and apparently most established firms to hit the buffers. After all, Lehman Brothers survived the 1929 depression and Woolworths had put in time on almost every high street in the UK, yet both were swept away in the recent downturn.

Around 400,000 small businesses close down each year in the UK and over half of those closures occur in the first year of trading. Although not all the closures come under the heading of home-busting events, no business owners like to have a personal failure on their hands, even if it doesn’t wipe them out financially.

This chapter lists the main problems to avoid – the ones that cripple small businesses so that they have to shut their doors in the first year or so.

Knowing Too Little

Running your own business calls for a well-rounded range of expertise. In the early morning you may have to be coach and trainer to a new employee, by mid-morning (coffee-break time in big business parlance) you can be negotiating with the bank for an extra line ...