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January 27, 2016
Growth  |  4 min read

The 7 Deadly Sins of New Employers

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Clate Mask

The stage two business typically has two to three employees and is generating $100,000–$300,000 in annual sales. There are about 1.7 million of these businesses in the United States alone, according to Infusionsoft research. These “New Employers” are beyond the stage one self-employed solopreneur, but they are not out of survival mode. And they frequently commit one or more of these seven deadly sins that will eventually kill the business if not remedied.

1. Failure to hire the right person. That first hire is almost as scary as going out on your own. Suddenly, you’re feeling responsible for someone else’s income. What’s even scarier? They are responsible for YOUR income! If you get this hire wrong, you’re in trouble.

2. Failure to fire the wrong person. When there are only two or three people in the business, if the owner doesn’t let go of a non-performer or a bad fit, that bad employee will ruin the business. Sadly, too often the kind-hearted or confrontation-averse employer punts on this critical responsibility. For a while, the business owner takes little or no income. But eventually, either the employee must go, or the business will fail.

3. Nobody is responsible for selling. The most common failure at this stage is the belief that selling is a necessary evil, that the product or service will sell itself or that “we’re all responsible for selling.” No. Selling is serving. The product won’t sell itself. You must sell or die. And if you, as the business owner, aren’t responsible for selling, you better make sure someone is. Or the business will fail.

4. Roles and responsibilities are not clarified. When two or three people in the business all share all the responsibilities (many times this happens in a partnership or small family business), it might feel good for a time, but it will eventually kill the business if you don’t separate out the roles and give clear responsibility to each person. Then, you must count on each person to pull her weight and get the job done. No free-loading.

5. Failure to stick to the unique selling proposition (USP). Your USP keeps you from doing all things for all people, or doing “whatever it takes to make a buck.” This is counter-intuitive because you’re in survival mode. But as my former CMO, Greg Head, says, “You must focus to grow.” He’s right. Stick to your target customer and USP.

6. Negative thinking. The critics are only stronger when you have more responsibility than just yourself. The stakes are higher. The fear of failure is more pronounced. Your business is not yet well established. You start thinking, “Who am I kidding?” “Am I a charlatan?” “If they only knew…” Well, don’t succumb to the negative chatter all around you—from friends, families, customers, cowardly bystanders, and especially YOU! You’re on the right track. Critics suck.  Keep driving forward, and you will succeed.

7. Failure to follow-up. You have more business cards, prospects, and customers than you can keep straight in your head. Get a system for following up with these people. It will dramatically improve your likelihood of success. Failure to follow up is one of the biggest reasons small businesses fail.

SBS Idea of the Day: Make sure, absolutely sure, that one of the people in your stage two business is the sole owner of the responsibility to sell.

Read the other posts in Clate's Seven Deadly Sins series:

The 7 Deadly Sins of Solopreneurs

The 7 Deadly Sins of Steady Operations

The 7 Deadly Sins of 7-figure Businesses

The 7 Deadly Sins of Growth Companies

For more insights from Clate, check out Clate's Corner on the Infusionsoft Knowledge Center.

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