Home Money & Business Mistakes in Business: 10 things you should never do

Mistakes in Business: 10 things you should never do


10 business mistakes to avoid

Mistakes in business are inevitable. The first few years of business are actually for making mistakes. Whether you survive past the 5-year mark depends on the types of mistakes you have been making, and the lessons learnt. There are mistakes that bring growth, and there are others that bring failure. Here are the 10 business mistakes you should never make:

#1. Starting a business without systems in place

One day I visited an M-Pesa shop and found the attendant reading a book. She was so carried away by the book that she only lifted her head to look at who was entering the shop and then went back to her book.

You have probably visited a store, checked a few things that you wanted to buy but the attendant neither welcomed you nor made any gesture to help you acquire it. This is what happens when you start a business without a structure.

business systems

As a business owner, you need to be able to run operations without even reporting to work. If you let everybody report when they want, work as they want and leave as they want, you will not operate for long.

Naturally, the only thing most employees love about work is the paycheck. The majority of workers especially in Kenya want to sit idle in the office waiting for payday. They will complain about all the targets you set for them, give excuses about why clients are either not buying or returning, and find new ways to spend the company money.

Read Also: Make free money hosting travelers at your home

As a business owner, you should be able to know whether your employees are reporting to work in time, doing their work, selling your product in the best way possible and bringing value to your company every single day. You need to put systems in place to track operations and processes without micro-managing people.

#2. Failure to manage processes/systems

Back to the M-Pesa business, there was a time you probably visited an M-Pesa shop and were given a different number to deposit or withdraw your money. The agent number was at a different location, and the agent was using her employer’s resources to run her own business. This was before Safaricom put restrictions on such practices. However, these malpractices are not just limited to M-Pesa.

There are supermarket/shop attendants who see you buying something and then propose to give you the same item from a different location and at a cheaper rate. My friend has encountered several such attendants, especially when refilling his gas. I have encountered them at Bata, where they propose to give you shoes at a cheaper rate but you pay them directly.


It is not enough to have CCTV cameras to check how stock is moving, how clients are being handled, and what time employees are reporting or leaving work. You need to closely monitor those systems and ensure that everything is running smoothly.

Your systems may be working but if you do not manage them, you are not better than one who has no systems at all.

#3. Failure to track cash flow


Money will be coming in, and money will be going out. I have met women who sell items in the Maasai Market. One of them told me she can make sales worth 20,000 in a day, another 200,000 in a day and yet another, 300,000 in a day depending on what they are selling. One day I sat with them, saw how cheaply they were selling their products, how they bought expensive lunch for themselves, paid for transportation and storage of their products and realised that they were operating at a loss.

Once, I discovered that the lady who was selling a skirt at 800/- after a client negotiated a 200/- discount had actually spent 1,000 to make the skirt. She had paid for the stall, storage, transportation and took lunch worth 500/- that day. You see, even if she makes sales worth 50,000 and does not know how much of that money is profit, she will continue running an unprofitable business.

You need to know how much it cost you to get a product to a client and see if it is a worthy venture. For instance, if you run a consultancy and a client calls you for a meeting at a hotel where you spend 2,000/- on a meal, you need to see if you are getting value. Perhaps you spent 2,000/- on fuel, spent 5 hours in the meeting, and gave the client a solution that would turn his/her business around. Your rate should factor in the 4,000/-  you spent, and value for the three hours!

Most business owners are satisfied in knowing that the business can pay rent, salaries and cover other expenses. This is not enough. You must be able to tell whether your business has broken even, how much profit you are making, and if there is any growth taking place in terms of revenues.

#4. Becoming comfortable with current achievements

Comfort is one of the biggest mistakes in business. A friend of mine was relocating to a different country and decided to sell his business. When he asked for my advice, I asked him how much money he was making daily. For over 10 years, he had been making 15,000/- in sales! When I asked why he was not growing his revenues, he said he was busy doing other things. Yes, he was paying the bills and making some profit, but 15 years is a long time to be stagnant!


The business environment keeps changing, and if you are not careful your business will become irrelevant the moment you rest on your laurels. If you are comfortable with your current revenues, what will you do when expenses grow?

You cannot keep paying people the same mediocre salaries because you are not pushing them to make more sales, or because you are reluctant to innovate new products. In business, everything eventually changes and so should your current product, revenues, processes, employees, and technology if you really want to grow.

#5: Hiring incompetent people

Every new employee needs training on how you do things, but they must have some skills that will enable them to discharge their duties. One of the mistakes business owners make is hire friends and relatives who do not have any professional skills and experience to run their businesses. If you really want to help those people, send them to school, find them jobs elsewhere or just give them the money. As long as they are not qualified, they should not work for you.

Ever visited a bank, asked for a service only for the attendant to say, “I don’t know, let me ask the manager”?  This has happened to me more than once. Not just in banks, but other organisations as well.


There are employees who give clients misleading or false information because they do not know. You have probably been turned away because “we do not offer that service”, only to find out later they actually do. It’s either that the person did not have the information or was too lazy to help. This is something you cannot afford to have in your business.

Every client is precious, and it costs too much to secure just one client; do not let them go!

#6. Keeping disgruntled employees

Attitude is more important than talent in any business. A good attitude is like a magnet, it attracts the right people – clients and strategic partners. Employees become disgruntled for various reasons, ranging from pay to targets to jealousy. These are the employees who talk negatively behind your back, tell new employees ‘kampuni sio ya baba yako’ or ask them ‘How can you find me here and start giving suggestions?’


Disgruntled employees keep talking about what is wrong at and with work will cause others to disrespect you and become inefficient. They have been quitting for the last 3 years, and give other employees new reasons to quit every day.

Keeping disgruntled employees can hurt your business beyond recovery, so let them go early.

#7. Failure to innovate


It is said that failure to innovate is to die. Innovation is the key to the growth of any business. To attract new clients, retain old ones, beat the competition and differentiate yourself, you must innovate.

One of the best ways to remain innovative is by collecting feedback from clients, listening to the suggestions and of the sales team as well as recommendations from other employees.

Read Also: Disruptive technologies are here to stay

#8. Revealing your trade secrets

Every thriving business has one thing that sets them apart from competitors. There is something unique you do that keeps you in business. That is your trade secret. Giving out your secret is like Samson revealing the secret to his strength to Delilah.

innovation in business

One thing you need to know is that competitors will always try to bribe one of your key employees to sell them secrets. Do not overtrust any employee to the point of telling them all your secrets. Anybody could be selling your secrets to competitors. The day you reveal your secrets is the day you will get out of business.

#9. Fearing to fire

In business, you will have to relieve some employees off their duties. Your best employee can make a very costly mistake. Will you have the courage to fire them? It is said that to be a successful business person, you should be able to fire your own mother.

#10. Fearing to hire talented people or to delegate roles

When all is said and done, you need to be able to do work through others. Yes, you need to have some secrets, do some things yourself, but at the end of the day, you must know which roles to delegate. You cannot see the bigger picture if you are entangled in small roles. As a business owner, you cannot do everything and expect to accomplish anything. You must decide to be the manager or entrepreneur, and let other talented individuals take over operations.

talented employee

One of the common mistakes in business is thinking that talented employees are a threat. This is common among SME owners who decide to fire any employee who seems more knowledgeable than them. Instead of cultivating an intrapreneurial culture to nurture innovation.

Not every employee wants to start their own business, let alone compete with you.

As long as you have systems in place and keep your secrets safe, you don’t need to be afraid of hiring talented people.

Previous articleValentine’s Day heartbreak: How to stay safe
Next articleJob in Nairobi: Female Graphics Designer to run a cybercafe
Linguistics graduate and seasoned online journalist, researcher, content manager and SEO analyst.