As a new business, it is easy to fall into traps and make mistakes. There are lots of pitfalls that stat-ups must navigate and some are easier to avoid than others. Whether you’re brand new to starting a business or have done so before, it is worth being aware of some of the potential mistakes your new business could make.
The following article will discuss some of the most common mistakes new businesses make and how to avoid them.
1. Naming Your Business
Picking a name for your business is an important first step when starting a new company. Yes, you can rebrand later down the line, but the initial name is still important.
It is vital you ensure that your name is unique and not already registered by somebody else. In addition, you want your company name to capture the values of your company and indicate the industry if possible. Using a business name generator is a great starting point for this as you will be able to find unique names with little effort or imagination. You will then want to register the name and buy the domain in order to secure the name.
2. Tracking Expenses
Failing to keep track of your expenses is an easy but potentially costly mistake to make as a new business. Whether they are big or small, all expenses should be documented.
Start-ups have many options available to them if they intend to do this themselves but equally, you can hire an accountant to deal with this side of things if there is a lot to manage.
This goes hand in hand with tracking expenses. Everything your business does from meetings to sales must be documented. This is incredibly important and needs to be done correctly and professionally. Once again, hiring someone who can take care of this on your business’s behalf is a smart idea.
4. Mixing Expenses
Keeping business expenses separate from personal expenses is crucial for a new business. It’s easy for the lines to blur when starting up but not mixing them will make paying taxes a lot more straightforward than they otherwise would be. Having a financial accountant is the best way of keeping these separate and avoiding stress and potentially avoiding losses when it comes to taxes.
5. Intellectual Property
Patents, copyrights, and trademarks make up intellectual property and are absolutely invaluable to a new business. It is important to be on the ball from the start when it comes to protecting your intellectual property. Further down the line, you could come into unwanted legal battles if you fail to do so.
Creating a contract to use with your customers (even if you don’t have any yet) is a must from a very early stage. Contracts allow you to protect yourself in the event of any trouble. You can base your contracts on existing contracts from other similar businesses in your field and consult a lawyer to make sure everything is correct and above board.
7. Non-disclosure Agreements
On the subject of contracts, non-disclosure agreements are also vital. These should be drawn up as soon as possible before you even start discussing the possibility of a company with other people. This will protect the information being discussed from being used against you. Anyone who signs a non-disclosure must keep matters discussed private and confidential for a stated period of time.
8. Tax Payments
Companies need to pay taxes ahead of time by calculating them in advance. Failing to do so can land you in hot water so profits and losses per quarter must be constantly up to date.
A tax advisor will help you keep all your tax-related affairs in order and prevent you from accidentally flouting tax regulations. Taxes should be monitored regularly and not just on a yearly basis. In addition, by hiring someone to deal with this side of things, you will have more time to dedicate to business matters.
9. Business Lawyers
In order to protect yourself and your company from any wrongdoing or legal issues, hiring a business lawyer is advised. Business lawyers can help you make informed decisions regarding legal agreements and prevent you from getting into sticky situations further down the line.
10. Infringing Trademarks
trademarks can encompass names, logos, designs, and words. Infringing on these trademarks by using other businesses’ registered trademarks can cause a lot of unwanted legal issues. Careful research to make sure you are not infringing on another company’s trademark is required to save potentially lost time, money, and effort if you are caught.
A simple web search is the least you should do but if you want to be fully protected, it is advised you conduct a thorough background check to make sure you are within your rights when starting your business. As always, a professional can be hired to help you with this phase of starting up your new business.
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