In this episode, we explore Bad Business Habits that can slowly but surely undermine growth and profitability. Surprisingly, many business owners develop unproductive habits without fully realising their long-term effects. Accordingly, addressing these bad business habits is essential for building a sustainable and thriving enterprise, no matter the industry.

The Pricing Trap: Harmful Discounts

Firstly, one of the most common bad business habits is underpricing products or services to attract more customers. Although offering discounts may initially seem like an effective strategy to boost sales, it often leads to reduced margins and undervalues your offerings. Instead, setting fair and well-considered prices that reflect the true value of our work benefits both the business and its customers. Pricing correctly establishes trust and ensures profitability in the long run.

Doing Everything Alone

Another bad business habit involves attempting to manage every single task on your own. However, this can lead to overwhelming workloads, inefficiency, and eventual burnout. Delegating responsibilities to a capable team or outsourcing certain tasks is crucial for success. Additionally, using tools like the Pricing Calculator on the "I Hate Numbers" website can help prioritise high-value tasks. With proper delegation, we can focus on strategic decisions and growth instead of mundane details.

Focusing Only on Low Prices

Similarly, focusing too heavily on finding the cheapest options can create bigger problems over time. This approach, which is one of the most damaging bad business habits, often sacrifices quality and ultimately hurts customer satisfaction. Rather than cutting corners, it’s far better to invest in reliable solutions that enhance value and protect your reputation.

Avoiding Financial Advice

Additionally, some business owners avoid seeking professional financial advice due to perceived high costs. Nevertheless, working with experts ensures better decision-making and financial health. Tools like BudgetWhizz can further support effective budgeting, helping to avoid critical financial mistakes.

Breaking Free of Bad Business Habits

Evidently, recognising and overcoming bad business habits is a transformative step towards achieving long-term goals. While breaking these habits requires effort, the rewards are undeniable. For actionable tips and deeper insights, listen to this episode of the I Hate Numbers podcast. Take control of your business habits today and pave the way for a successful tomorrow.

We all have habits. We have habits that are good and we have habits that are bad, and the same applies in our business, and in this week's I Hate Numbers podcast, I'm going to be exploring and looking at four particular bad habits, what they are, and what we can do to try and break them. Let's crack on.

Now, running a business is not an easy thing to do. With so much on our minds, so much to think about, so much to deal with, it's very easy and very tempting to fall into bad habits that may, in the short term, seem very helpful, but over time, it has a negative impact, and not just on the bank balance. What I'm concerned with, what I'm interested in, is what those habits are, but more particularly, how we can wean ourselves away from them, and how we can break them.

Now, a habit is just a usual way of behaving. We all have habits, and it's easier to prevent bad habits than to break them, according to Benjamin Franklin. Let's have a look at bad habit number one, and that's the pricing trap. All of us can hold our hands up to this. Now, it's tempting, especially when you're starting up in business, to attract new customers by offering discounts, lowering your prices, or perhaps even doing free work.

Now it feels like an easy way to gain that foothold, to gain traction. But in reality, this habit can be damaging. It's damaging to your bank balance. It's damaging to the perception in your customer's eyes, both current and prospective, and underpricing your services or your products creates a cycle that's extremely difficult to escape from.

Once your customers are used to paying a particular price, raising them becomes challenging without the real risk of losing that business. Now, that's not to say we shouldn't go in at low prices. Pricing is a very complex arena, but as a general approach here, we need to be aware of its dangers. In terms of perception, consistently low prices may reflect in your customer's eyes, current and perspective, that your work is less valuable, which may be further from the truth.

What you need to do is to start by selling a fair price that represents the value of the work, the value of the transformation you're making, the value of the problem you're solving for that particular client. Over time, you can increase those rates as your reputation increases, and it'll help you identify those quality clients that you wish to go after.

Think about your positioning, think about your brand, what is it you're offering? Competing on value, not just on discounts, can be a sustainable approach to growth. What's habit number two? Well, habit number two is that DIY approach. We do everything ourselves. Now, I've been in that situation where, when I first started 30 years ago, pretty much everything under the sun, I would try to do myself, and you know, saving cash.

What's wrong with that? Now starting out, you might feel you need to do it all after all, nobody has more intimate knowledge of your business than you, isn't that the case? But here's the catch trying to handle every single task yourself can actually limit your business's growth, so when you're bogged down with admin accounting, cough cough, social media, promotion marketing, everything in between, you're diverting the energy away from the tasks that will truly make an impact and drive your business forward. What's the solution? You need to appreciate the value of your time.

Now you can actually calculate this, if you check out on the I Hate Numbers website, we've got a calculator where you can price your time out. But your time has a value; as a business owner, your focus should be on growing of the business, the strategy, identifying where clients are, communicating with them, as well as delivering your service.

Areas where your unique skills and competence have the most impact is what you should be focusing on. Delegating, outsourcing tasks such as accounts, bookkeeping, content creation, customer support frees up your time so you can concentrate what you do best, and it's a great effective use of your time. In my own business, I have a team, a great team, who are there to support the business and do, for example, some of the bookkeeping work.

Historically, I would have done all of that myself. But now, that's not a good use of my time. It doesn't mean I can't do that, but that's not a good use of my time. So think about, in your business, what is it you're doing? One of those tasks that you're doing that, if you look at it and think, actually, that doesn't add value, I'm actually limiting the amount of time I've got available for my own delivery for gaining new clients and for growing the business.

Getting that support helps give you the freedom to focus on the bigger-picture goals, helping you grow much faster and more sustainably. If you're wary about whether you can afford to do that or not, well, that's where a financial cash flow plan comes into place, and check out the notes, by the way, for a link to Budgetwhizz, our financial planning tool, which can do the heavy lifting for you.

But I digress. Start small, if needed, pick one or two tasks that you can delegate, you can oversee and experience that positive shift in the time that it liberates if nothing else. Once you get into that habit, you can build on it, and you'll find that delegation becomes more comfortable, and it becomes second nature as your business grows.

It's about delegation, it's not about abrogating or walking away. Habit number three, where we always look for the lowest price. Now, in the early days, it's quite natural. We want to preserve the money in our bank account. We want the best deals and the lowest prices, but prioritising the lowest price over quality will cost you more in the long run.

If you're always focused on the cheapest to do something, so whether that's building your website, whether that's getting advice from Danny down the road, whether that's developing your marketing materials, your communications, and you're going for price above everything else, well, ultimately, if it doesn't actually do what you need it to, you've actually wasted your money anyhow.

Low-cost solutions will often lead to poor outcomes. This affects your product, your service, and ultimately, it has an impact on your reputation. You need to move away from the idea about cost, cost, cost, and think about the investments that you're going to be making and the impact it will have on your business, not just your bank balance over time.

If your customers pick up that idea that quality is dropping, if the messages aren't landing as they should do, you're going to be losing customers and certainly not gaining them. So all your spending decisions should be based on value. And you need to think that in terms of money well-invested, whatever that resource is, from tax advice, marketing, building websites, the staff that you hire, the freelancers that you engage with. If it delivers and it brings you what you need it to, then that's money well invested.

Now your customers are always looking for value, and they'll appreciate it when you prioritise the quality. Bad habit number four, not seeking financial advice or not seeking financial support. Now one of the biggest mistakes that I've seen business owners make is avoiding professional financial advice.

Thinking I can't afford an accountant, for example, I don't need that tax advice. And when that time comes, when that advice is bought in, it may be too late to unscramble. I've seen many examples where clients have made decisions about seeking that appropriate advice, whether it's business structure, how to spend their money.

not doing a plan, and when it comes time to try and unscramble that mistake, it's too late. Now managing your own finances, I think a lot of it can be self-managed, might seem like a money saver. But if you don't have the expert guidance at the beginning to advise you how to set up, how to set up your accounting systems, how to plan, how to make those appropriate decisions, then you're going to be missing out on opportunities, not just in tax savings, but in other areas of your business as well.

You may be overlooking those important budgeting and cash flow management strategies that will benefit your business. Now, breaking the habit is simple. Look in your network, look for a trusted financial advisor or accountant, cough, cough. A professional advisor will bring you those insights into your financial strategy.

This will help you identify those risks and uncover the opportunities that you may have missed out on. And as all things, it's about attitude and reframing your mindset. A financial advisor is not an expense, but it's an investment. Obviously the right financial advisor. With their help you can make better decisions that will save you money and stress over time. So let's recap what I've been saying. The four business habits that we want to try and break, if not, shall we say wean ourselves off is the pricing trap?

Doing things ourselves as you're not delegating, you're going to build capacity by having more people coming in more efficiency. But again, you need to make sure you do this as a quality for money threshold. Always looking for the lowest price, those who seek cost all the times, you know effectively there's no loyalty built up, and you will lose out long term.

It's value that should be the driver, not just cost. And not having that adequate financial advice and financial support. Now, breaking these habits won't just help your business survive it will also contribute to making it thrive as well. So folks, what bad habit do you think you have in your business?

I'd love to hear that. Until next time, folks, happy habit-breaking. We hope you enjoyed this episode and appreciate you taking the time to listen to the show. We hope you got some value. If you did, then we'd love it if you shared the episode. We look forward to you joining us next week for another I Hate Numbers episode.