5 Common Mistakes Product Businesses Make

I recently did a podcast episode sharing the 5 most common mistakes I see product businesses make and how to avoid them.

I’ve written it out here for you, however, if you would prefer to take a listen, head on over to Products to Profits on Itunes https://apple.co/33oJiAQ or anywhere you listen to your podcasts.

Everybody sets out to have an amazing business that’s going to give them the perfect lifestyle and create their dream life of flexibility and the financial rewards of being a business owner. With all these great intentions, I see a lot, as a business coach, that the business sometimes ends up controlling you. That’s something that we obviously don’t intend to have happen but sometimes we can make a few mistakes along the way.

I actually think that making mistakes is a good thing because, here’s a secret, business mistakes don’t stop your momentum, they help you figure out a better path. I think people are too fearful of making mistakes. It’s often a taboo subject that we should cover up or blame our mistakes on other people but I think we need to accept mistakes to build our confidence and have really fabulous strategies to implement in our business. You’ve got to treat your mistakes as learning experiences. And, in the world of entrepreneurship, you are going to make a lot of mistakes. Trust me! I have made a lot of mistakes in 24 years and I’m constantly learning from my mistakes and I am able to recover as quickly as possible from any mistakes that are made.

5 Common Mistakes Product Businesses Make

1. Lack of Self Care

The first mistake I see a lot of is a lack of self-care which is very common with the women I coach. Many of us are mothers and we’re juggling raising children, running a household and building a business. We are wearing so many hats simultaneously that burnout is one of the downsides of actually not having enough “white space” for yourself. Not having self-care or having any dedicated time in your working week that allows for some “white space” for you.

Now, “white space” doesn’t have to mean that you’re taking baths and doing yoga classes and having massages, it’s simply blocking out a dedicated time in your working week, every second day or every morning before you get started, to essentially have a plan of conquering your three biggest goals for the week / what tasks you need to implement, so that you feel as though you’ve got momentum but at the same time you’re also allowing yourself to have time to invest back into your business. Personal development is so underrated and it’s something that when you invest in yourself and invest in Personal development it basically creates more opportunities for you to scale your business.

If you’re nodding your head and thinking

“I actually do need to look at how i’m managing my time” and if you’re feeling depleted, if you’re feeling like you’re a headless chicken running around raising children, caring for your family and you are also wearing so many hats in your business, it’s time to actually look at how you can create more of that “white space” so that you can invest more into your investment in yourself and also into the success of your business.

2. Not Finding a Mentor or Business Coach

This is a really common mistake I find.

I’ve just been on the Gold Coast where I hosted a fabulous two day VIP Retreat for my business product clients. Everyone flew in from all around Australia and we had a magnificent time. It was completely life-changing! And, what came up a lot with the 16 of us was the fact that a lot of people tend to share and to get feedback and advice from family members and friends. It isn’t always great advice and they get a little frustrated because their friends and their family just simply don’t understand what it’s like to be running a business.

So my best advice to you is to find a Mentor or a Business Coach. Get advice from a legal professional when you need it, or get business financial assistance from an accountant. Work with professionals, not family and friends, and make sure it’s paid advice not free advice that essentially will help you step up in the business. Let go of any advice from people that have no experience in running a business so therefore can’t really provide real-life advice.

You’re better to get feedback and validation from a community of other like-minded business owners. I have so many fabulous clients in my Mastermind that also get to come away on the special VIP Retreat where we create the “white space”. We provide them with the space to be able to grow their businesses and also to be surrounded by other like-minded women in businesses that are all going through very similar experiences and sharing experiences. I think that’s what makes these retreats so uplifting!

3. Bad Pricing

The third common mistake I see is with pricing. Particularly with people that are hand-makers. People that are not factoring in any labour component in or any fixed costs.

It’s okay when you start out. You have a small side hustle that might be something that you do because you don’t really enjoy your job and you want the creative outlet. You go to markets and get great product validation and great feedback and think “Hey, I’m on to something! Its fabulous and i love it! It’s creative and it’s gonna be a pathway for me to have my own business.”

What happens, is that people move from a small side hustle and sometimes rapidly scale up and without realising it they’re not that profitable anymore. If anything they’re underpriced.

One component that you need to factor in when you’re calculating your retail price, or even your wholesale price, is the fact that they’re going to be fixed costs. You’re going to grow and you’re going to ideally have staff that you have to pay a salary. You might sign a commercial lease? You’ve got costs that are now starting to eat into your profitability. So, when you’re pricing you need to take your raw cost and you need to also factor in labour and handling.

For example, you might have a candle business. This might be calculating how long it takes to do the labelling and the boxing and the packing. This may take a person 5-10 minutes per candle.  You need to account for this time so you can calculate your per-unit cost. Really look at your pricing. You need to be set up for profitability from the very beginning in order to actually grow up business. Because revenue is really just vanity metrics. If someone’s trading over $1 million, they might not actually be that profitable at the end of the day if they’re selling their product under-priced.

4. Not Knowing your Target Audience

The fourth mistake is a big one! Not knowing your target audience!

It is incredibly vital that you know your customers. The tricky thing is, that your customers can vary and can actually be looked at a number of different ways. It’s absolutely critical that you find your ideal customer and you start to build a customer profile so you’ve got a really clear understanding of who you’re marketing to. It is extremely important to create an environment where every person who interacts with your customer is gathering data to know them better.

You really have to have a solid understanding of how they behave and why your product is a fabulous solution for them;

– what value it adds to their life?

– why they are repeat customers?

– what do they love about your product? and

– why they keep coming back?

It’s just really about knowing your ideal customer and by being niche. Like myself. I am very niche; I only work with creative women who are commonly mums, who want to grow their businesses over $1 million and they have a physical product. it’s much easier to target your audience when you have a solid niche when you can identify what your customer’s needs are.

I think that when we’re thinking about your target audience we can look at your data. What the sales are telling you? You could look at your social media insights – Instagram provides insight on demographics, location, gender etc. There’s lots of data that you can extract in order for you to understand who is your niche, who is your best customer, how are you going to reach them, where they hang out, what they love, what are their other interests etc.

Targeting and Pricing are my two biggest critical success metrics – the “secret sauce” to helping business women scale their business to over a million dollars.

5. Not Outsourcing to Scale

And finally, the number five mistake to really avoid, especially when things start to take off in your business, is not hiring help. Not looking at letting go, not outsourcing to scale, I would say is a really common mistake.

If you want to scale your business it is impossible to do that over a million dollars without hiring help. It’s just simply not humanly possible. I’ve never seen it done.

It’s time to pull up your big girl pants! ⠀

Do you want to avoid the 5 Common Mistakes Product Businesses Make? I can help.

Within the Creative Product Institute Mastermind, you will create a strategic plan for scalability and consistent thriving cashflow to launch your business to the next level.

If 2022 is your year to scale your Product Business, book a complimentary 30-minute call with me here to see if The Creative Product Institute is right for you.