What mistakes did you make when starting your business? by jk6276

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musing-threads · @jk6276 · Oct 31 '18 (edited)

$4.29

What mistakes did you make when starting your business?

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👍 musing, futuremind, saiful39, luueetang, jolasol819, marksantos

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This should have been my first warning sign. <em><strong>Mistake number 1.</strong></em></p>\n<p>I strongly believed at the time that I could do a better job and build the business up.  I didn't have a lot of money saved, so I borrowed the funds to buy the business from my parents.  This was <em><strong>Mistake number 2</strong></em> as it was a big risk I was taking, and by borrowing from my parents, I was involving them (and some of their retirement savings) in my risk. 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From a purely business side of things, absolutely a mistake. From a personal life choice perspective, definitely not a mistake.  But for money reasons it was so I shall make this <em><strong>Mistake number 5.</strong></em>  I moved close to my business and started living with my girlfriend at the time.  I had found love just before I bought the business, and my partner lived close by.  Financially, moving in together in a expensive rent part of town, was a big mistake.  I don't regret this one for a second.</p>\n<p>The relationship caused more issues for my business.  My staff felt I was taking too much money out of the company for personal use.  They also formed an opinion that my partner was using me and was only in it for the money.  I knew this was not the case, but perception is everything.</p>\n<p>Despite all this the business kept growing.  I eventually put my prices up, had doubled the size of the weekly takings, and was slowing the bleeding of money out through debts and late payments.  Things were looking promising, and then we got more good news - My partner was pregnant, we were going to have a baby.</p>\n<p>As things progressed, I experienced more negativity and doubts from both my family, and my staff.  They were pretty much all of the opinion that my partner (at this point my fiance as I had proposed) was taking advantage of me. A gold-digger they suggested (or at least gossiped behind my back)</p>\n<p><em><strong>Mistake number 6</strong></em> in all this was not having any other assets backing me up.  The lease on the business was due for renewal. Despite the fact sales had grown, the company had very little money, and some large debts accrued over the two years of misguided management on my behalf. The shopping centre I was located in required stores to renovate the store before they would get a new lease.  I found myself trying to borrow $100,000 from a bank, during the middle of the global financial crisis (2007-08).  This proved to be impossible as I had no outside assets (property) to secure a loan.  The franchise company I was a part of wanted to keep the store operating, and I was in debt to them for a significant amount of stock and franchise fees that I was behind on paying for.  They ended up taking back the store from me in February 2009.</p>\n<p>That was the end of my business career.  I had lost $70,000 of my parents retirement money. I was in personal debt on credit cards, tax debts, behind on car payments and so on to the tune of around $40,000. I had some very angry staff that didn't end up receiving their entitlements, a fiance, a teenage step-daughter and a 6 month old baby - and no job.  </p>\n<p>We ended up moving out of Sydney all together, moving 500 kilometres away to restart our life. We moved in with my partners parents, I got a job working for a big supermarket chain and moved on with life.</p>\n<p>10 years on, I can say I do not regret this time of my life.  It was a massive learning experience.  And as for the \"gold-digger\", well she stuck by my side through all that life threw at us. We had another child and finally got married a couple of years ago.  Still in financial difficulty, have been living week to week for 10 years.  But happy, with the love of my life, and having survived some down times and carrying a lot of guilt around for many years about how badly things went wrong. </p>\n<p><br></p>\n<p>I hope my story can help someone to avoid some of the mistakes I made (there was others but these were the highlights)</p>\n<p>Thanks for reading, </p>\n<p>John aka @jk6276.</p>","appDepth":2,"appParentPermlink":"fkd97q7lx","appParentAuthor":"ajayiwaldorf","musingAppId":"aU2p3C3a8N","musingAppVersion":"1.1","musingPostType":"answer"}"
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futuremind	21,180,927,217	100%
saiful39	3,979,443,130	100%
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@futuremind · Nov 1 '18

What mistakes did you make when starting your business?

<p>I really enjoyed reading your analytical breakdown of your perception of mistakes in your business endeavor. This is valuable advice for the interested entrepreneur.</p><p>I'm interested in starting my own collectible trading business. There are many people trying to create deals with me, and many middle men appearing. My intuition in this is strong, in detecting ulterior motives. Your response here has helped me put this in perspective a bit. </p><p>In a competitive world, I believe skepticism and intuition of the motives of others, is not only necessary, but also, a much needed skill for success. </p><p>That is not to suggest I couldn't be overly paranoid, as you stated in regards to perception, sometimes it can produce inaccurate results, but I've learned to trust my instincts over time.   </p><p>I've also just encountered my first mistake as a seller. Missing merchandise. I'm not sure how to handle this productively, but my idea is to offer a similar merchandise for free, as well as offer a refund for the missing merchandise if this is not substantial. Hopefully the costumer is cool in this respect. I still have to figure out how I made such a critical mistake though! There is so much to consider when it comes to managing a business. </p><p>Thank you for taking the time to compose this excellent information!</p>

👍 jk6276, green-heron

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@jk6276 · Nov 1 '18

What mistakes did you make when starting your business?

<p>Hi @futuremind, thanks so much for taking the time to read my answer and respond.  While I may know very little about the collectable trading field, many aspects of running a business are universal.  I guess to sumarise my experience, having a dream and fulfilling it is great, but unless you also can apply a critical, calculating view of the situation, you may end up in trouble.   </p><p>Research lots, take the emotion out of your decision making.  Take advice, but make your own decisions, don't just blindly follow the advice.  Back your judgement 100%, but never be afraid to admit when you are wrong.  Analyse everything - your business, your competition, the market. Do a SWOT on your business - and a proper no-shit SWOT without any emotion attached.</p><p>Best of luck with your venture, and thanks again for letting me know you got something out of my answer here.</p>

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