Here’s a little video about ten mistakes that a lot of business owners make, often without any clue about the real damage they may be doing — both to their immediate and long term success.  The whole this is only 10 minutes, so if I were you, I’d grab a pen and paper, and take a look now.

And if you’re doing any of them – and you probably are – stop it right away.

Oh, and leave your comments on the blog when you’re done, they might help others in avoiding these horrible traps.

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47 Responses

  1. Rys

    Hi Paul,

    I am new to your site and your e-mails, thank you for providing your wisdom to many of us. When you speak about some of these it comes across as common sense, so I appreciate your perspective, and helping me take off the blinders.

    I recently ready your 2 part article on Charging Higher Prices. I have a question for you. I am trying to create a pricing structure for a product I think ALL businesses can use…I know, I know, you’re probably thinking here’s a newbie that is way out there, thinking he has a product to solve anything and everything…but the question I pose to an owner is this, “Could you benefit from word of mouth referrals”, if so, then my product does just that. The ability to promote the testimonies/referrals about your business.

    Our product does have a monthly fixed cost (not exorbitant, less than $3 per month), but the value to the customer is huge…it really is. How would you go about pricing something like this when we can scale it very easily and there is no competition to what we offer?

    Thanks very much,

    Rys

    P.S. the localinmotion.com site is a new site we are launching here in Oregon, but does not showcase our latest offering.

    Reply
    • admin

      I think the answer depends on your overall strategy, and of course, the actual VALUE to the customer. Fixed costs matter because they put a floor on what you can charge while breaking even – unless you want to fund your takeover of the market. From there, what matters is your goals, and unfortunately there is no “one size fits all” approach. Market conditions matter. Customer perceptions of value matter. Your own growth and market share goals matter. TESTING HELPS.

      Reply
  2. Crystal

    Hi Paul:

    I like the way you read and answer your Blog Offering. I have just sent a note to your Admin.
    Thanks Crystal*

    Reply
  3. Roger Bauer

    As always Paul, good stuff. I’ve been following you for years and enjoy learning from you as I appreciate your approach and application of knowledge.

    Since I tend to do a lot with mind-maps, I thought I’d share the one I just created for your video so that there’s a printable reminder of the mistakes and how to overcome them for those interested.

    Anybody can access the mind-map by clicking the link below or copying and pasting it into their browser address bar (no registration required):

    http://ListSamurai.com/lemberg-mmap.html

    -Roger

    Reply
    • admin

      Roger,

      Great rendition. Thanks.

      You’re going to have a hell of a time mind-mapping Business Profit Blueprints when it comes out later this winter.

      -pl

      Reply
  4. Donna Lang

    Paul- Good Material. Great Style. Important and Laser Focused. Exactly what I needed to hear today.
    I am eager to see what you will serve up next.
    Thanks
    -Donna Lang

    Reply
  5. Ravi Jayagopal

    Paul,

    Terrific tips. I’m so hooked on your style of presentation, starting with Formula 5! Incredible content, incredible value, delivered with your typical awesome style.

    I have been guilty myself of lowering the price to sell more. After I listened to your Raise your price strategy on F5, that’s when I realized my mistake.

    Great stuff, indeed.

    [SIDEBAR] You should probably add a Subscribe to comments plugin, so people can get notified when someone else comments on this blog post. Just a thought.[/SIDEBAR]

    Thanks!

    – Ravi Jayagopal

    Reply
  6. Dr. Box

    Hi Paul,
    thanks for posting this.. I am guilty of at least a few more than I am currently willing to admit 😉
    Hey, I just met with a prospect who has made (and continues to make) every single mistake you mention in this video at least twice. it is truly amazing that some never learn from their mistakes – perhaps because they don’t see these events as mistakes… well, then again.. these folks have $35m in the bank right now and until that number drops by 50% or more I don’t think they will be coming around for guidance. Since they are based in LA I was going to send them over to you 😉

    btw, since it is the season for giving thanks…
    I want to specifically and publicly thank you for over-delivering. Experiencing F5 this past year was one of the best courses I have ever participated in. I invest $20k each year in sharpening the saw and that means that I buy way too many courses! F5 is powerful stuff and your monthly teleconfs are a wonderful way to bring your points home.

    I overheard something this past month that I can not verify but it seems appropriate here:
    “Bruce Lee apparently taught that one can not be a master of 1000 moves but if one were to truly master just 6 moves he could easily defeat any opponent.” – is it a coincidence that F5 includes 6 modules?

    Reply
    • admin

      Hey Ted, thanks for saying so. It’s been great to work with you in FormulaFIVE. Not really coincidence between Bruce Lee and FormulaFIVE. No direct causality – only common sense. -pl

      Reply
  7. Alexandre Boudreau

    Excellent information. I’ve personally made some of these mistakes and they are indeed fatal. Admitting you’ve made mistakes is certainly key as it will allow you to re-orient your business strategy and get back in shape, before its too late.

    Alexandre Boudreau

    Reply
  8. John Chancellor

    I think # 10 is by far the biggest and most costly. Too many people would rather protect their ego than their pocketbook. The concept of sunk cost is just too much for some people to grasp, accept.

    All were good and #4 is a wide spread problem. You must have the margin to do a better job. In the end people will pay for better product/services.

    Reply
    • admin

      John – it depends and I agree. if #10 is a problem, it magnifies all the others. – pl

      Reply
  9. Geld im Internet verdienen

    Wow – what a great presentation – and sooo well layed out and brought across … it really hit home! 🙂

    Thanks a lot, Paul! One can see (and hear) that you ARE one professional! ;))
    Helmut

    Reply
  10. Crystal

    Hi Paul:

    Would like to speak with you regarding linking into my site… Good for people to solve some of these things prior to learning the hard way….

    Also, where is your location…. If you were to receive a one page Vision/Biz Plan and some cost projections, how could your advice be monitized?

    My problem is having solutions but giving them away for free…. people take them and run, perhaps w/o would take years to learn…. but still might stumble if not knowinf when to ebb or flo… course all necessary to be both humble and respectful…. I submitted to my linked in profile a vision/biz plan and look for coaches to refer people to… my love is the creative side of start up and then would like to balance things off with good advice on the basic principles…. Could we come up with a package that could be measureable with its results….??? Hard to do for a start up. I have a biz idea that I am just forming, that has good strategic timing and opp to be successful and could be very duplicatable.

    Reply
  11. Beau Smith

    Great vid, Paul. At first I just wanted the information written down, as someone else mentioned. But then the way you presented it was strong and helpful. Thanks.

    My friend, who is in the internet biz in a big way – he has a server farm in Atlanta, for example – tells me not to learn the Adobe Suite and Dreamweaver and rather to assemble a team of very good people: a graphics person who can lay out the site. A programmer for content management and backend. An overall webmaster who knows about SEO. And maybe a flash guy. I am a sculptor and my product is art- sculpture. So it has to look good and be presented well.

    In the past I have built my own site and worked on it. I’m WYSIWYG kind of guy. I’ve used Publisher (yeck) and Frontpage 2003. But now I’m ramping up my biz and I need a much better site, content management system, all that. Is what my friend suggested the way to go? I paid someone recently who was not a specilist and… Well, my site needs help.

    Second part to the question: I am a professional sculptor. My big product (human-sized copper frog sculpture) sells for a lot, but it doesn’t sell often enough… and materials and labor… Way too expensive to drop that product in galleries on consignment and have to wait for a sale. That is how I’ve done in the past but now things are different plus I must expand. I have gotten help creating smaller versions of what I do, something that shops and galleries could buy outright. Sales for my big work trickle in. I’ve been doing this a long time (20 years) and am established in my biz. Plus I have some prestigious and highly trafficked placements of my work. As I see it, my priority and focus should be here:

    1. Whatever sculpture that comes out of my workshop (sculpture, not craft, though skillfully crafted) should be the best of what can be done in the medium in which I am working. I continue to hone my craft. I also pay someone to reproduce EXACTLY my efforts. My hand is in all the work. But I get others to help me. I am quality control and my stamp is on all the work. I need to make sure to keep a level of production and that all I produce is of high quality. I am always looking for ways to increase my efficiency and effectiveness and make my job easier.

    2. Basically I need to maintain a level of high quality production in sales and marketing. That is, I need to make sure that sales come in every week and I need to constantly be finding ways to make that easier and more efficient. I know my product and I can sell it… Is it a matter of finding good people and dealers and shops and galleries and give them the tools? I’m not a professional marketer. I’m a sculptor. But marketing is essential.

    Does this basically sound right? I’m sure I’m leaving stuff out. But then, this post is long already. Your thoughts?

    Thanks much,
    Beau

    Reply
    • admin

      Beau – you’ve got to make a fundamental decision about whether you want to be a craftsman and do the work yourself, maintaining control, getting it just right — or — whether you’d rather build a team that can scale with you and allow you to focus on the handful of things you are REALLY GOOD at, and build a sustainable business. A business you build around yourself as the key doer can never be sold. It is an income rather than an asset. -pl

      Reply
  12. John Jaworski

    Great Video Paul. I’ve been caught in the “One Big Customer Mistake a couple of times. It’s easy to be seduced by a big Customer, their big money, my big ego….

    If you have a big Customer and they are taking most of your time, what’s the best way to get back some of your time. Would I employ others to take care of them, can I somehow communicate to them that I can’t give them as much attention etc.

    Great stuff! Thanks!
    John

    Reply
  13. Aji

    I did not see the video yet. But I am going to.

    I have to say I loved the title of email you send to the list. How can somebody not click or open with a title like it. I will use the tittle for my letters.

    Reply
  14. Michele Price

    Paul:

    Thanks for a great video. May I suggest a post listing them 1-10 under video. I found myself going back to hear the one I was answering over and over. Loved the points you made.

    What suggestions do you give companies when looking at keeping higher prices or raising them to SHOW more value in real examples please. It helps us connect in our brain when thinking about concept.

    p.s. I am not making #4 giggle learned that years ago watching other biz playing cut throat. I kept raising prices and showing how my service was better. Even when you are able to do that-show in previous business how you are more valuable… when in a new business wrapping your brain around showing value each time with each additional business takes practice.

    Reply
    • admin

      Michele, but then… it would be a product, wouldn’t it? (Business Profit Blueprints will expand tremendously on this while providing scalable solutions.) Let’s talk more. -pl

      Reply
  15. John D. Fogleman

    Paul,
    Great video. I think the one you left out is the most important.

    ~11. Quit focusing on all the negative. Look for the positive and make it fun to go to work.~
    People that are in the wrong mindset tend to portray their feelings and problems. It is so important to focus on the positive things that they have and build on that, and to have fun while they are turning the business around.
    We all love to be around people that are having problems but instead of letting that bring them down they keep forging on even with more enthusiasm than ever.
    It’s not that easy, but it does start with whats between your ears.
    Her is a good suggestion to start, just smile at everyone you meet tomorrow & watch what happens!

    Just like Zig said, ” The truth is, fear and immorality are the two greatest inhibitors of performance.” Do it right and rid yourself of the fear of mistakes and setbacks.

    Thank you for being such a leader in helping others. YOUDAMAN!!!

    Reply
  16. James

    Hi Paul,

    How did you produce the video to show the presentation on the side with you in it?

    Thank you

    James

    Reply
      • James

        Hi Paul,

        Thank you

        Your video really hit home areas i need to improve on keep up the great content

        Cheers

        James

  17. brian

    paul great looking site ? How can i tackle my fear of success, which has underminded my past business decisions. i tend to make at least five of the mistakes you mentioned today. I want my new, digital media consulting business to be successful. How can I determine which system of success to model. there’s so much good advice out today. could you suggest a effective method/answer that can assist my business development.

    Reply
  18. Kenrick Cleveland

    Hi Paul,

    Great video. Great wisdom.

    The part on perfectionism really hits home.

    Here’s a question: Since everyone seems to be lowering their prices these days, how do we enact your strategy effectively that you talked about regarding charging more?

    Thanks,

    Kenrick

    Reply
    • admin

      Kenrick,

      Great question. You maintain your price position, or even increase your price position, by providing more value and powerfully communicating that value. (You may have noticed that of the following: Rolls Royce, Rolex, Fendi, Fabrage, Vuitton, Chanel, Cartier, and Prada, none have lowered their prices! How do they manage to do that? )

      pl

      Reply
  19. Internet Strategist @GrowMap

    Your Tweet about your video had great timing. I not only retweeted this video – I reviewed it at StumbleUpon and linked to it from my latest post. The more businesses that see it the more will benefit. So many do not realize that what they’ve always done is simply not going to be enough during economic challenges. Now is no time to skate – they better be focused on what will bring the most new results.

    While your coaching is most likely out of reach for the small businesses I do my best to advise they can definitely benefit from this video and what you write.

    Reply

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