Five mistakes small business owners should avoid in 2022.

Whether you are a rookie on the entrepreneurial playing field or a seasoned veteran, you can still make mistakes when running your small business—mistakes that can do lasting damage. While you cannot escape the effects of events such as natural disasters, there are things you can do to minimize other potentially fatal errors. The first step is knowing what some of your worst gaffes could be so that you can avoid them altogether.

1. Underestimating time.

One of the truest sayings in the business arena is “time is money.” Although hours are not finite inventory items that can be priced and tracked, they can still trickle through your fingers.

No doubt, you have gotten involved in a project that requires far more of your time and energy than you had ever anticipated. Every additional hour takes you away from other crucial tasks, subtly causing your profits to ebb away. Combat this often imperceptible issue by:

• Recruiting assistants.
• Researching techniques to get the job done faster.
• Learning from your mistakes and devoting more resources in the future.

2. Inaccurate price setting.

If you’re just starting out or are launching a new product, how do you know what to charge for it? For many, the temptation is to see what your rivals are asking and simply charge less. However, that is an incomplete strategy that may leave you losing money instead of making it.

Keep in mind that price calculation should include numerous factors: how much you paid to buy and stock the item, your labor and materials, your overhead and ancillary employee expenses, and even hidden but crucial components like complimentary services and product support. Prevent this common mistake by:

• Knowing your industry’s unique pricing variables in advance.
• Analyzing the pricing practices of your competitors.
• Taking time to map out every cost that goes into your product.

3. Failing to be proactive about late payments.

In the real world, customers may become lax about giving you what they owe, sometimes by accident and sometimes on purpose. When dollars stay in your customers’ pockets instead of flowing into your bank account, you can’t use that cash to meet either your current or long-term needs.

The good news is that help is closer than you think. Your point of sale (POS) system has inventory and invoice management tools that will enable you to automate much of the billing process. Instead of manually sending out reminders or making tons of awkward phone calls to delinquent payers, your payment processing for small businesses equipment can be set to send timely emails that can take most of the burden off of your shoulders. What time you do spend on billing can be devoted to the most complex issues that require direct contact from you.

Keep late payments to a minimum by:

• Billing customers promptly.
• Dealing with complaints or concerns as soon as they arise.
• Ensuring that your accounting staff are efficient and well-trained.

4. Poor or nonexistent procedures.

You chose to start your own business because you wanted to be liberated from working for others. However, that freedom should not extend to a lack of protocols or processes. Without clear practices and procedures, your business will quickly descend into chaos.

At the very least, you need to adopt systems for logistics, inventory management, human resources (hiring, firing, benefits, job responsibilities, workers’ insurance), billing, and payroll, just to name a few. Your POS system should act as a hub around which all of your business systems operate, making everything from product and employee management to customer relationships run more smoothly. Get your systems and protocols in order by:

• Speaking with your payment provider to learn about the tools your POS solution features.
• Dedicating time, research, and thought to the creation and regular updating of documentation that outlines your basic business procedures.
• Making sure that all staff members are fully aware of what is expected of them, as well as the consequences that will occur if your requirements are not met.
• Collaborating with peers, consultants, or legal professionals to make certain that you have left no stone unturned.

5. Failing to ask for help.

This leads right into one of the most potentially destructive errors that business owners can make: Trying to do even the most complex tasks on their own without enlisting the necessary expertise. For instance, you may be the most cutting-edge hairstylist in town, but that doesn’t mean you are equally skilled in tax preparation. Nor is it likely that you understand the intricacies of digital security or insurance.

There is no shame in reaching out for assistance from specialists. In particular, don’t cut corners when it comes to accountants, attorneys, and web developers. Having qualified people on your team might initially take money out of your account, but these collaborations will likely save you thousands in the long run.

Offering products and services to consumers is fraught with risks. While you cannot escape some of them, many can be minimized or avoided altogether with a healthy dose of planning, knowledge, and well-placed assistance. Take pains to prevent these common business mistakes and your retail store will be poised for sustained success.