5 Crucial Mistakes Entrepreneurs Should Avoid When Buying an Existing Business
You’ve decided to purchase an existing business. You have fresh ideas and plans to make your new venture a booming success. Before you jump in with unbridled passion, it is imperative you check your ego at the door and consider the costly mistakes your enthusiasm might be leading you towards. Following are five don’ts you should avoid as you take over an existing business.
1) Don’t assume a name change is a good thing. Often new owners think they have to change a business’ name to give the company a fresh start. You might be doing more harm than good by alienating existing customers before you’ve had a chance to secure new clientele.
2) Don’t think you have to run your new business all on your own. Sure you want to establish your authority as the new owner, but you might want to consider promoting an existing staff member to a supervisory position. This lets staff know you’re willing to work with them to build a better company and takes a bit of the weight of running a business off of your shoulders.
3) Don’t assume that changing the way inventory is offered to customers needs a radical shift. Some business owners think they need to completely revamp inventory procedures when they take over an existing business before giving the old systems a fair shot. Customers might be used to the way inventory is offered (i.e. printed price sheets versus digital inventory) and will balk at being forced to adapt to your new ways. Work with existing structures at first and then determine what works and doesn’t work with your plans for business growth.
4) Don’t rely on the current customer base as your only opportunity for sales. The previous owners might have overlooked prime opportunities to connect with new customers. Be willing to think creatively in terms of finding new customers and revenue streams. Consider a wide variety of customers that might be in need of the goods/services your company offers.
5) Don’t stick to existing marketing plans. If the business’ previous owner sold to you, it could be that their marketing efforts weren’t working. Dive into the data analytics on everything from social media outreach to SEO; you might find plenty of opportunities to increase eyeballs on your recently purchased business.
Buying an existing company isn’t for the faint of heart. Entrepreneurs often want to build their own company from the ground up. If you’re willing to have an open mind and be creative in your approach to brand growth, an existing business can turn out to be a gold mine of opportunity.