Last Updated 7 months by Emily Standley-Allard

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Starting a new business is not an easy task. There are hundreds of things small business owners need to go over and get on track to make sure that they are heading in the right direction to make a profit. 

But what about the things that small business owners shouldn’t do when starting a small business?

To help get business owners moving in the right direction, we contacted Pamela Foley, founder of AOU Creative, a brand management agency, who shares ten things not to do when starting a business. 

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Starting a business without ticking off the necessary legal boxes is like constructing a building without a solid foundation. This isn’t just about avoiding trouble, but it’s about building a secure framework for a business. 

“Business licenses, zoning permits, and tax registrations, disclaimers and more may seem like mundane paperwork, but they’re essential for operational legality and integrity.

Not taking them seriously can lead to fines, legal headaches, and possibly even the closure of your new venture,” says Pamela.

This holds true of ecommerce stores and all online businesses.

Never Underestimate the Importance of a Killer Website

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A website is not a luxury, it’s a necessity.

It’s the digital storefront of a business and often the first interaction customers will have with the brand.

Neglecting a website is equivalent to turning customers away at the door. 

“Make it eye-catching, user-friendly, and responsive, so it looks good on all devices. And remember, your website should be an authentic representation of your brand’s persona, style, and ethos,” advises Pamela. 

Avoid Mixing Personal and Business Finances

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Personal and business finances should never mix. Even when running a small operation, business owners must separate their finances.

This simplifies accounting and bookkeeping, and it protects personal assets in case the business encounters any legal challenges. 

Don’t Perform Copycat Branding

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Authenticity is the basis of a memorable brand. Copying your look, feel, or messaging from a bigger player in the industry can lead to customer confusion. 

“Take the time to understand your brand’s voice and the problem you’re solving for consumers.

Create a unique brand identity that showcases your uniqueness and let that authenticity shine through in every aspect of your business,” comments Pamela.

Not Insuring Your Business

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Starting a business without insurance is like driving without a seatbelt and risks too much. Insurance does more than cover owners in catastrophic events.

It can also be essential for day-to-day operations. 

“Though I can’t give you legal advice, depending on your industry, you might consider various types of insurance, like liability, property, or even cyber insurance, to protect customer data,” suggests Pamela. 

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Ignoring Social Media Metrics

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Social media can collect data about a target audience’s behavior and preferences through engagement rates, shares, and click-through rates.

This data can refine branding and marketing strategies, making social media a crucial tool for business growth.

Not Creating a Business Entity

Starting as a sole proprietor may seem simpler, but it exposes personal assets to business risks.

Creating a business entity like an LLC or corporation separates your business and personal liabilities, offering a shield for your personal assets.

Check with your accounting and legal team to learn more.

Or use Tailor Brands to set up your business simply!

Tailor Brands

Being Inconsistent in Branding

A brand is a story that is being told to the world. A story needs a consistent narrative to be effective.

An inconsistent brand narrative confuses the target audience and weakens the brand’s impact. 

“Whether it’s the color scheme, logo, or tone of voice, consistency makes your brand memorable.

Apply this consistency across all platforms, from your website and social media to emails and packaging,” recommends Pamela. 

Don’t Make Verbal Agreements

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Handshake deals might seem sufficient, especially if business owners are doing business with friends or long-time associates.

The problem is that verbal agreements are not only difficult to enforce but can also lead to misunderstandings and disputes. 

“It is a good decision to always put agreements in writing. Contracts set clear terms and provide a legal framework for resolving disputes should they arise.

They may seem like a hassle now, but they can save you countless hours and resources in the long run,” says Pamela. 

Never Rely Solely on Paid Ads

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Paid advertising may help business owners reach new audiences quickly and efficiently, but SEO and word-of-mouth are beneficial for steady growth.

“Typically, focus on organic results and use ads as an add-on. You may need to change your strategy based on what is needed,” says Pamela. 

Remember, starting a business is not just about getting off the ground, but it’s about laying a strong foundation for sustained growth and success. 

Follow for the best ways to grow your audience, your revenue and your business online!

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