Common Mistakes We All Make and Ways To Avoid Them (written May, 1993)
Admittedly we are in a very unpredictable business. There are good months and there are bad months. There are ups and there are downs. Being prepared for them starts with avoiding the most common mistakes below.
Common Mistake #1) Putting too much money into fixed expenses that do not create sales. It is nice to have a beautiful desk and a nice office in a nice building and a digital one touch dial-matic telephone, but the fact remains, if you put too much money into those expenditures that do not produce and create sales, then there is a good chance you will find yourself strapped when your advertising budget comes up – and when you don’t advertise, guess what? You won’t make any sales. My suggestion: Keep your costs down by using what you have and put your money into advertising promotion. Advertising creates sales. Sales create profit. Profit allows you to spend on nice fixed expenses.
Common Mistake #2) Not focusing in on the right customers. A good price for a mailing list or a cheap ad in some publication might look great, but are you targeting the right type of person you are looking for? For example, a local windows contractor advertised in our local newspaper here where I live last week and has been every week for the last few years. I asked him how is doing with the ad and he said he has had poor results. Well I pointed out that he might be having poor results because even though the ad is nicely priced, this particular newspaper, which boasts a circulation of over 18,000 is only delivered to 6,000 homeowners. That means 12,000 of the circulation he is paying for are people that don’t need his services. The key is to make sure your ad is seen by as many of the type of customers you are trying to sell as possible. One time, I ran an ad for free Information on a money making opportunity in The National Enquirer – 3 million circulation – and the ad was priced OK. It wasn’t expensive considering it is read by over 3 million people. At the same time, I ran the exact same ad in Small Business Management that boasts a circulation of only 60,000. The ad cost double the price compared to the ad in the National Enquirer. Which one brought me in the most responses? You guessed it. Small Business Management brought me in over 600 requests and if you can believe it, The National Enquirer brought me in only 17 responses, plus the quality of the leads were far superior from Small Business Management. What does that tell us? Focusing in on the right customers and getting our advertising in front of the right people are going to bring us in the most response and the best quality of responses. Circulation and Price should not be our main factors.
Common Mistake #3) Underselling your services. The price is one consideration for a customer. Quality is another consideration. The cheapest price is not always the best way to promote. It will hurt the quality of your service for sure. It may not bring in enough money to cover your costs of doing business and on a personal note, I have found that the type of people who complain about prices are the same type of people who will give you the most headaches. Don’t charge an arm and a leg for your services, but definitely charge a fair and reasonable price so you can give the best service you can and the quality your customer expects and you make enough profit to make it worth your while to work with them.
Common Mistake #4) The last most common mistake I see daily is to try and re-invent the wheel. Everything you and I are doing now has been already been done by someone else. History always repeats itself. Learn from the mistakes of others and do not try and re-invent the wheel. I heard this saying years ago and it applies here: “A smart person learns from their own mistakes. A genius is a person who learns from another persons’ mistakes”. Do you want to be smart? Or do you want to be a genius? Keep your eyes and ears open to all ideas to learn from what others are doing and what mistakes they have made.
There you have it. Avoid these 4 most common mistakes and you will be giving yourself a fighting chance to succeed. Thank you for listening. God Bless.
The author of this article is Larry Costello, President of All-American Print & Mail, 2200 Wilson Blvd #102-57, Arlington, VA 22201.