1. Living beyond your means. You go for the big house, pricey toys, and exotic vacations. You wind up with a huge mortgage and a mountain of credit card debt. Because you’re under pressure to increase your income, you cut corners, push customers to buy products they don’t need, and even misrepresent your offerings. You do whatever it takes to preserve your desired lifestyle.
How to avoid: Don’t chase the big lifestyle; live within or slightly below your means. Keep your life in balance, not overly focused on money and material goods.
2. Running with the wrong crowd. You begin working with suppliers that cut compliance corners. They encourage you to weaken quality control benchmarks or hire representatives with questionable backgrounds. Doing business the right way no longer matters. Pushing more product becomes the only objective.
What can happen: You lose your ethical focus. You start selling products that are unsuitable for your clients. Your regulatory authority sanctions you. Your clients start to wonder about your ethics and warn their friends about you.
3. Growing too fast. You started out as a solopreneur. But in the last several years, you’ve added so many new clients you decided to bring on a bunch of new employees.
What can happen: Your overhead soars. Your revenue doesn’t. Trapped like a gerbil on a treadmill, you lose sight of your quality focus. Customer experience starts to suffer. You also start ignoring your current client base in order to bring in new clients. Loyal clients defect.
How to avoid: Manage your growth so you never have to abandon the practices that made you successful.
4. Getting comfortable. You went into business because you wanted to help people. You used to love the work, but now it’s getting old. Clients keep asking the same questions. Suppliers are a pain. You’d rather be fishing than putting in long hours at the office.
What can happen: Rather than find a new career, you just hunker down until retirement. Your edge slowly rusts. Many of your best clients notice—and post their complaints on the Internet.
How to avoid: Keep learning about new products or techniques. Get involved with a professional trade association, ideally in a leadership position. Network extensively with others in the business. Get active in non-business pursuits that stoke your energy and creativity. If you can’t stay excited, find something else to do.
The point is this: Ethical lapses are more likely to happen when business owners make bad life decisions. Don’t let this happen to you. Here’s how:
● Keep your life in balance,
● Don’t hang with a bad crowd,
● Manage your business growth, and
● Keep your professional edge sharp.
Do all this and your journey as a small business owner will remain enjoyable, productive, and profitable.