When it comes to opening a business, Wade Brannon knows what it takes, and, more importantly, he knows what mistakes to avoid. Since 1984, Brannon has overseen the opening of more than 300 businesses. Brannon is the owner of Pigtails & Crewcuts, a children’s salon franchise with more than 30 locations across the country. In addition, he once served as senior vice president and principal of Heavenly Ham, which he grew from a single retail store in Hilton Head, South Carolina in 1984 to more than 230 locations across the United States. Here, he shares the top 10 mistakes that people make when opening a business.
1. Unrealistic expectations. Research, research, research. You owe it to yourself and your employees to do your due diligence long before those doors open, so that you’ll have an idea of what to expect. Look at what your competitors are doing. Determine if a trend is growing or shrinking. Research whether this concept will be a good fit for your market. If you’re opening a franchise, find out what kind of support you can expect, and determine what other kind of support you’ll need to supplement along the way.
2. Over-planning. Nothing ever works 100 percent according to plan, so don’t get too caught up in the details. Be flexible, so that possible delays in construction or inspections don’t throw you off. I also like to tell people to plan for the worst-case scenario, and be thrilled when the results exceed their expectations.
3. Under-planning. There are a lot of steps that are involved with opening a business, and it’s important to start with some basic guidelines and keep yourself on task. Write up a to-do list, so you can reference it when you’re feeling overwhelmed.
4. Short attention span. You have to work for success. Over the years, I’ve seen many business owners quit after three, six or nine months, frustrated that their bank accounts aren’t already overflowing. It takes energy, devotion and, most of all, time to develop a loyal following.If you’ve made the decision to open this business, you need to fully dedicate yourself to the time needed to make it work.
5. Going it alone. Word-of-mouth does wonders for business. Get out there and get involved in your community. While you’re spreading the word about your business, you’ll also pick up pointers from friends, family and neighbors. Welcome their advice (within limits). Also, consider taking on a partner, if you think you’d benefit in the long term from the support and camaraderie.
6. Too little cash. First and foremost, before opening a business you must be sure you secure enough capital. It’s not only important to have the funds to get the business up and running, but owners should also stow away a rainy-day fund, just in case.
7. Befriending you employees. Keep a healthy distance from your employees. You are their boss, not their friend.
8. Breaking your marketing budget. While researching your business, determine your audience and learn about how that demographic responds to marketing. Are they social-media savvy? If so, do you understand what it takes to reach them? Do they still read newspapers or flip through the Yellow Pages? Determine who they are and hone in on how to best reach them. Don’t select multiple methods and spread your budget too thin right out of the gate.
9. Banking on a grand opening. Never hold your grand opening on your first day of doing business. The grand opening shouldn’t happen until you’ve been open long enough to work out the kinks. Soft openings give you and your staff a chance to adjust to day-to-day issues and schedules before inviting the whole world in to see. New customers aren’t always as forgiving as you’d like them to be.
10. Communication with your family. Whether you know it in the beginning or not, your business will impact your entire family. Before opening, consider your family’s situation. If you have a young family, do you want a business that requires you to be away from home for extended periods of time? Can you realistically divide your time among your family duties and the requirements of running a business? Talk about all of these issues extensively to make sure there are no surprises—or hurt feelings—down the line.