The U.S. Bureau of Labor Statistics reports that more than 18% of new businesses fail in their first two years. More than half don’t survive past the fifth year. With such negative statistics, how do you launch and run a successful startup? 

Like many new entrepreneurs, you’re probably fired up about your business idea and can’t wait to launch your company. But before you do, spend lots of time on research to ensure you avoid the mistakes that plague many new businesses. Make the right moves in the beginning to avoid headaches later on. Here are five mistakes to steer clear of when starting a new business.

Not Creating a Business Plan

As the old adage goes, “If you fail to plan, you plan to fail.”  Too many startups start without a business plan. You should have a business plan, even if it is just one page. 

You don’t need a long or detailed business plan. But it will help you know where to focus your energy and resources. It will also serve as a reference point for your team and provide milestones for measuring your progress. In the business plan, include the operating costs, your ideal customer, and how many products you anticipate selling.

Ignoring the Competition

If you sell your product for $10.00 apiece and your competitor sells theirs for $6.00, guess who is going to sell more? Researching the competition helps you know what your competitors are doing well and what challenges lie ahead. Competitive research will ensure you don’t repeat your competition's mistakes.

Research will also help you understand market saturation. For example, if you want to open a pet grooming business, find out how many similar businesses exist. The market may already be saturated with this business.

Inadequate Financial Preparation

Some entrepreneurs neglect financial planning and underestimate how much capital they need to get their businesses up and running. They end up with insufficient money to achieve their goals. To avoid this, prepare financial projections for your new business. They will also help you secure financing.

The good news is if you have enough money, you may only need to borrow a little when your finances are affected. An online car title loan can be enough to keep you going till you make more sales.

Expanding Too Quickly

When your business starts becoming successful, it’s easy to assume that growth will continue. But if you expand too rapidly, you may end up closing up shop. The growth spurt may be only temporary. Don’t expand your business because you’ve sold more products in 3 months. Take a slow and steady approach to expansion.

Not Investing in Marketing

If you don’t invest in effective marketing, no one will know your business exists. Most small businesses don’t spend money on marketing, they use free marketing strategies. But these strategies take time to produce results. Start marketing your business before you launch it. And after you do, run marketing campaigns continually if you want your business to be successful.