Common mistakes made by inexperienced and unseasoned businessmen
The first is the failure or inability to distinguish between what is fact and what is opinion. Opinion is seldom infallible. It is never better than the information on which it is based, the qualifications of the person voicing it and his ability to correctly interpret the information at his disposal. Sometimes businessmen inclined to read and hear opinions and accept them as facts, then make decisions based on those opinions without further investigation or study. Paul however also said that when he made such kind of mistake, he never blamed anyone – even those who gave him their opinion, he only can blame himself for accepting it without question.
As an example, he told a story about a manufacturer he knows well. This man read a trade journal article mentioning that one novelty item is in great demand. He believed the article and spent US $100 000 to set up facilities, buying raw materials to produce that item. Sadly, when he was ready to go into production, he discovered that half-a-dozen other firms were ahead of him and beginning to distribute the item to the market. And the market was saturated even before his salesmen could start selling his product.
In order to succeed in any deal, project or endeavor, the businessman must assemble all the available pertinent hard facts and study and analyze them himself. It is fine to ask for advice and opinions of others, but he must not follow the advice blindly. He must understand the opinion and back his decision based on good facts.
The second mistake relates to risk taking. Unexperienced businessmen hesitate to take risk and sometimes this reluctance hinder the success. After careful study and painstaking analysis, he made the decision and start the plan to implement his decision. But he must at the same time, bear in mind that there is always a possibility that some completely unforeseen elements or developments will turn up to alter or even wreck his original plan. He is, however, must secure in the knowledge that he has done everything within his power to tip the odds for success in his favor. He must accept that he cannot think of nor insure against every contingency. Businessmen must take calculated risks to succeed. If it is is not risky at all, everybody can succeed in business: stock transaction, industry or commerce. The risk involved in investments would be offset by the potentials for eventual profit.
The businessman who is able to calculate his risks – and then is willing to take them—has his battle for success nine-tenths won. The remaining one-tenth is the unknown variable, the unpredictable factor “x” that puts the zest and excitement into the game. Without that “x” factor, business would be hopelessly dull, routine and uninteresting.
The third mistake is not following through his plan. After making a decision based on sound judgement and facts, the businessmen must follow through with all his might.