– Hey, everybody. So today we’re gonna talk about the 10 most common mistakes
that I see new entrepreneurs or wannabe entrepreneurs make that cause their businesses to fail. And this is across all industries, and not just online businesses. Now we’ve got a lot to cover, so let’s just jump straight into it. One, they treat their businesses like a magical money vending machine. Seriously. I see it all the time. Most people who say that
they want to start and build a new business aren’t actually
looking for that at all. Instead, they just want a
magical money vending machine, a magical money vending machine where if they put $100
in, they’ll get $200 back. But funnily enough, it
doesn’t quite work that day. Here’s how it actually works. Most businesses take at least
six months to turn a profit. “Six months? Really, Sarah? What a scam! “Why on earth would it take so long? “I want money right now.” I’m sorry, but that’s
extremely unlikely to happen because you see, a business
isn’t some ambiguous thing that you do to make money. A successful business is when you do these three things well. One, you find or create great
products or services to sell; two, you put those products
in front of the right people; and three, you give those
people a great reason to buy. And there is a learning curve at getting good at these three things. Some people are a genius
at doing them naturally, but like most things in life, the majority of us will have to learn through education and experience. Now if you choose to
live in a fairy-tale land where you have unrealistic
expectations of overnight success then you can expect a
failure rate of 99.9%. And let me explain why. In a recent video that
almost no one watched, I highlighted a subscriber’s store, Kyan. He said, “My print on
demand business has failed. “I don’t know what I did wrong.” So I took a look at his
new business venture. Kyan’s entrepreneurial goal
was that he wanted to start a clothing line aimed at pug lovers. And so he had a cute pug
created for him by an artist. And then he slapped two
slight variations of the pug onto two T-shirts, one
awake and one sleeping. And then he went and slapped
it onto socks and a pillowcase because why not? And that was it. That’s all Kyan has done. Basically, he made and advertised two slightly different T-shirts, and it turned out that
nobody wanted to buy it. It was a radical idea. Try again. Make a new design. It’s your first time ever
creating a T-shirt design, Kyan. Why would you expect
that your first design would be a million-dollar hit? And so as I said to Kyan, the only reason his pug store failed was because he gave up immediately. Now let’s compare Kyan’s
response to failure to my good friend Michael Shih, who designed this T-shirt for dog lovers that has made well over $100,000. When he launches a new T-shirt design, he’ll see how customers respond to it. If a T-shirt doesn’t make money, he’s very happy to tweak the design based off customer feedback,
and keep tweaking it until he creates a money-making design, like this one was here. So it’s cliche, but it’s true. If Kyan had kept building
on his failed designs like Michael does, then
those failed T-shirts would simply have been
a delay to his success. And instead, by treating it like a magical money vending machine, he
declared his store a failure, and thus, he made it a failure. Two, they fall for shiny object syndrome. I know that this is a mistake
that I’ve definitely made when I was first starting
out as an entrepreneur. I’ve got a great idea. I’m gonna start a clothing line. It’s gonna be amazing. What’s this? Starting a social media agency? Cool. I’m gonna start one of those too. The problem though is that if you fall for shiny object syndrome, then
all of your business ventures are almost certainly going to fail. And to figure out why, we just need to do some
simple quick maths. You’ve only got 24 hours in a day. Most of you watching will
spend at least eight hours at work, and then you’ll
spend at one hour commuting and preparing for work. After taking out eight hours for sleep, that leaves you with
just seven hours a day, which is not much time. With those seven hours,
you’ve got to cook, clean, help out your friends and
family, and manage your life, plus, have some downtime as well, so that you don’t go insane and burn out. Most people will realistically be left with one to two hours each workday to work on their new business. And obviously, with weekends,
you have far more time. Perhaps you are very disciplined and you’re willing to
work eight hours a day. That means for most people, you are likely to have
around 20 to 25 hours at week at most, on average, to work
on your new business venture. Now consider this. One of the business models
that we teach on this channel is opening an online store and then dropshipping products in it. Usually, I recommend that
most new store owners devote at least 15 to 20 hours a week on their new business. And that’s actually less time than most other business models because of the fact that
this one is semi-automated. So just think about it. If you are trying to start
two, three, five businesses, you’ll literally run out of
time to launch any of them. So pick one business, and stick to it. Three, they overthink taxes. You know, I recently received a comment from one of my viewers
who was watching a video on dropshipping and taxes. “I almost don’t want to
start a business anymore. “I don’t even know if I should bother. “I hate taxes.” Well, Dominic, you know what? I hate taxes too. Almost no business owner I know
likes thinking about taxes. And one of the benefits
when I was working a job job was I literally didn’t have
to give a single thought to my taxes. Here in New Zealand,
if you work a job job, thanks to a system called PAYE, the government will take taxes
out of your paycheck for you. So by giving up my job job
and becoming an entrepreneur, handling my tax returns is
now a new burden that I have. But you know what else I have? I now have the freedom that I am no longer chained
to my day job and desk. Thanks to passive income
I built from my businesses since I now don’t have to
exchange my time for money, I’m fulfilling my life dream
of traveling around the world in business class and first class since I no longer have a
salary cap on my income. So sure, I have to spend
one to two days a year working with my accountants to make sure that my taxes are in order. But you know what? I think that’s a sacrifice
I’m willing to make. Four, they think that
their business is awesome, but their customers do not. This here was a comment that I received from a subscriber, Emileo. He had just started a
new business venture, an online dropshipping store, and wanted me to give him feedback. Now when I saw that the URL to his store literally had his name in
it, I was like, “Oh no.” This store was clearly not
set up to serve customers. It was set up to serve Emileo. And as I reviewed the store,
that’s exactly what I found. The store was, and still is to this day, simply a collection of random products that Emileo likes and is
interested in himself. This store is admittedly one of the more interesting stores I’ve ever seen. It was ugly then, and
it’s just as ugly now, but I’m not surprised, as Emileo has built the
store with himself in mind, and that makes it much
harder to be objective. Why? Because most of you
watching, including myself, suffer from illusory
superiority, a cognitive bias that makes us think we
are superior to others. Another name for it is
the Lake Wobegon effect, named about the fiction Lake
Wobegon town, where it’s said that all the women are strong,
all the men are good-looking, and all of the children are above average. You may have noticed that
almost everyone you meet will say that they are
an incredible driver and that everyone else is terrible. If you’ve ever wondered
why everyone thinks this, now you know. Unfortunately, the Lake
Wobegon effect means that it’s actually quite difficult for us to be truly objective about the things that we create and do, which is why analytical
data can help us do that. A year ago, I made this video about why I thought new dropshipping stores shouldn’t sell expensive products. I was proud of it. Packed with information, fantastic. And then I looked at the
video retention stats. Wow, what a blow to my ego. Hmm. Yeah, okay. Maybe I was wrong. When I re-watched that video, I realized that, especially
in the second half of it, I did very little to make
it visually interesting. It was mostly just me sitting and talking directly to a camera. And, you know, thanks to
the Lake Wobegon effect, I found watching myself
talk for 13 minutes to be extremely engaging. But funnily enough, my
viewers didn’t agree. Ever since then, I’ve made a huge effort to vary up my videos visually, ever going so far as to
hire an animator full-time, and the results speak for themselves. Five, they eat McDonald’s. So earlier this year, I was
in Canada, visiting friends. A few years ago, they
started a new successful business venture, beekeeping and honey. They’re an awesome example
of a pair of millennials who hated their 9-to-5 life
and took action to change it. However, they’ve recently
been suffering a lot from having no energy and exhaustion, and were struggling to
keep up in their business. And so I was very surprised
to walk into their house and discover this, McDonald’s bags. They said, “Yeah, we eat it “because we don’t have
enough time to cook.” And I was like, “No wonder
you have no energy.” Look, I get it. As a new entrepreneur,
you have limited time, so you’ve got to cut some
corners to save time. But don’t do it buying McDonald’s. For breakfast each day,
I have the same thing, oatmeal, yogurt, and coffee. For lunch, I have more coffee, yogurt, some vegetarian sausages, and almonds. And then for dinner, I
have lots of vegetables that I chop up and throw
into an oven for 30 minutes, along with some more vegetarian sausages. Plus some snacks, of course. And guess what? Not only is the food healthier
and cheaper than McDonald’s, but it’s faster for me to prepare this than go through a
drive-through to get a Big Mac. In the beginning, your
business relies on you. In the future, you’ll
build up passive income and be able to take breaks
with less consequences. But at the start, you
can’t just call in sick. Eat well and exercise. Don’t cut corners with your health. Six, they cut corners in the wrong places with their businesses. So I recently received this comment from a subscriber who asked for feedback for their new business venture, an online store that sources
products with dropshipping. In it, he said that he watched this video, a 15-point checklist of mistakes new online store owners make. He said he watched it
and made none of these. And so I decided, all right, let’s see if he has indeed
followed the 15-point checklist. And would you believe that John had not followed
my 15-point checklist at all? Shocking, I know. Coming in at number 10
on my list was this: create unique product descriptions that sell the benefits of the products and not just the features. Well, as you can see, this is one area that John chose to cut
corners in to save time. But this was a big mistake. Choosing to give up fancy
dinners that take an hour to cook in exchange for simple, healthy food that takes five minutes prep? Good time save. Not taking time to make a
well-written product description? Bad, very bad! As an entrepreneur, your
goal is to make money, and to do that, you need to
do two things really well. One is marketing. Two is sales. For an online store, your product page is literally your pitch to the customer. If I said to you, “Hey, I’ve
got this back brace for sale,” would you go ahead and buy it? No, of course not. It’s my job to explain to
you why you should buy it, how it will help you, and
convince you that you need it. So yes, you do need to
look for opportunities to cut corners because
we all have limited time, but you should always
prioritize your sales and your marketing. Seven, they try to compete on price. Let me just say this now. No matter your business,
no matter your industry, price competition is bad. Everyone loses. So what is price competition? It’s a price war, when you
try to compete with others in your industry on price. And guess what? You don’t have to do that. You see, Navin, just because
someone is selling a T-shirt on eBay for $10 doesn’t mean that you have to sell it for $10 too. Case in point. When I was running my video game store when I was just 16 years old, one of my biggest sellers
were Pokemon games for the Nintendo DS and
the Game Boy Advance. One way I’d get customers in is I would relist some of my games on this website here, Trade Me, which is New Zealand’s version of eBay. No idea what people list
this for sale for today, but back in my day, people
were selling this for $20. Now all Pokemon games, even slightly less popular
games like this one, are still all mega popular. So there were always a lot of
listings, but you know what? I didn’t care. I’d list my copies of
Pokemon Emerald for $40. Trade Me customers would see
five listings side by side for the exact same game. Four listings were priced at $20 each and one listing, mine, was $40, and guess whose game sold the fastest? Mine did. Mine sold the fastest because
I differentiated myself by having an amazing product listing. I had an awesome photo. I had a fantastic product description. I had an external website. When customers were buying from me, they weren’t just buying a
game; they were buying trust. So Navin, stop looking at your competitors who are selling items and
services for lower prices and think that you need
to price-match them. Think about other ways to
differentiate yourself instead. Eight, they underestimate
their customers’ intelligence. I remember receiving a comment from one of my subscribers, BossTech. He was an entrepreneur who had started a new business venture. He had set up an online
store selling watches that he was importing from China. Now, on the surface, it looked
like a fancy watch store, what with that picture of the
businessman on the front page in a suit wearing a nice watch and all. There was just one problem
with that though, these prices. They look pretty cheap for
nice watches, don’t they? They certainly do, and
that’s because BossTech wasn’t selling nice watches. He was reselling cheap fake-luxury
watches from AliExpress. And yet here was BossTech
trying to give his store this luxury, professional aesthetic. But you know what? It didn’t work, because
customers aren’t stupid. Just because you mimic a fancy watch store and give your watch a pretentious
French name like Bande doesn’t mean customers will fall for it. And, you know, perhaps BossTech
wasn’t trying to pretend that he was selling fancy
watches for cheap prices but it certainly came off that way. Remember, your customers are smart. Don’t underestimate their intelligence. Nine, they try to do
everything themselves. You know, something I find almost ironic is that while John was
cutting corners in his store and saving time by not
writing product descriptions, chances are he probably cleans his house, which is something that you can easily outsource to someone else. A while back, I had someone
comment that they noticed that there had been a significant shift in how much money I’m making these days. What changed? Well, as I said to them in a reply that could have probably
used a spellchecker, in the past few years,
I’ve placed more emphasis on doing something I’m
genuinely bad at, hiring people. And you know what? It’s massively paid off. By hiring people to
help me complete tasks, I’m able to save time,
which I can then use to expand and grow my businesses. Of course, most people are
not willing to do that. Most people are obsessed
with preserving their money rather than their time, which leads me on to something
that’s extremely important. 10, they are afraid to
invest and lose money. So I recently went over to
my parents’ house for dinner, and I had a really great
conversation with my father that I shared on my
Instagram post that explained why I’m willing to spend so
much on business class flights. And by the way, if you want to follow me, my handle is @sarahchrispy. I was telling my dad that I
hate comments like Kyan’s, the pug T-shirt guy,
lamenting spending $200 and not making that money back
immediately and giving up. I said to him, “I wish
people would realize “that seeing instant
returns on their money “isn’t realistic.” But my dad surprised me. “Sarah,” he said, “I don’t
think you’re being very fair. “People work hard for their money. “They spend many, many
hours each day working jobs “that they don’t want to do to earn it. “That money is precious to them. “Of course they’re afraid to lose it.” And I actually paused, and I was like, “Wow, Dad. You actually made
a pretty good point there.” And so I thought, why am I so surprised at this hesitant reaction
from new entrepreneurs who don’t want to spend and invest money? And it was then that I remembered, I used to work in a 9-to-5,
more like a 9-to-6 job too. On the side, after, and
sometimes during work, I would work on growing my
new video game hacking store and business. During this time, I spent
literally thousands of dollars on purchasing products
to sell and advertising and traffic campaigns that
turned out to be duds. Now, of course, it was a great investment. I learnt my niche inside-out and I became great at
driving traffic and sales. But getting there was
definitely a sacrifice. My job only paid me an average salary. It wasn’t like I had
lots of money to blow. Yet during that time, I never counted the dollars
I lost like Kyan did. In fact, losing money to make
mistakes and learn lessons never bothered me at all. What makes me different from Kyan? And then it hit me. Most people are obsessed with money. I’m obsessed with time. Losing money wasn’t scary to me, because I knew that once I was successful, I could make that money back. But that time that I
spent stuck at my job? That was something that
I could never get back. And so I became obsessed
with doing whatever it took to escape the 9-to-5 grind. And that sense of urgency meant that instead of viewing money as
a scarce resource to protect, I viewed it as simply a tool to helping me gain back
my time and freedom. (sawing) Remember, you can always
make back your money, but you can never make back your time. Thanks for watching this video. I hope it was able to help you. And if you are a wannabe entrepreneur who wants to start their own business but you don’t know how, then
you should be sure to download our free ebook, “The 6 Steps
that 6-Figure Online Stores “Follow to Make Over $10,000 a Month.” and you’ll find a link on
how you can download that in the video description below.