Small Business Success Stories and Common Mistakes

About 30% of small businesses in Canada fail within five years of starting up, an Industry Canada report shows. It's a scary number, but one that's understandable - there's so many things that can go wrong. The main reason most small businesses fail according to the report is because of mismanagement. About half the failures can be attributed to bad management decisions, not a slow market.

The good news is that 70% of start-ups make it through that first five years. One thing that many of these successful businesses have in common is that they have learned from their mistakes. I came across a couple of successful small businesses in the Financial Post that have shared their mistakes so that others out there can learn from them.

Some mistakes are ones that are widely spoken of, such as trying to do it all yourself, losing touch with your target market and marketing to too broad an audience. But some of the mistakes are worth mentioning here, like that made by Erin L. Schiffman, 31, the chief executive of graphic design company Schiffman Creative in New York City.
Erin says that one big mistake the company made in its early days had to do with a contract offering a big pay cheque. The company excitedly jumped on it without nailing down specific details, such as a time frame and payment schedule. Erin says that they were still working on the project almost a year later with no end in sight. Given the amount of work that went into the project, the large fee turned out to be not so large. Erin says the lesson learned is not to start working on a project until a solid contract that covers both positive and negative possibilities has been signed by both parties.