When you first set out on your own, typically you have few, if any, clients. Consequently, it's easy to fall into the trap of putting off until tomorrow what you should really invest in today. Most commonly, this list of to-be-deferred infrastructure includes vital agency technology, including: agency management systems, responsively designed websites, mobile applications, social media and ongoing IT support.

In reality, much of this infrastructure is needed upfront to support anticipated growth. You don't have to get the best and most expensive services and equipment, but a basic agency management system is crucial. You will want to ensure these initial investments offer scalability over the foreseeable future of your business.

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2. Lack of Due Diligence

Is that vendor right for your business? How much money will you really need in the first six to eight months while you ramp up? Does that agency management system work the way you need it to? Before you invest in equipment, cash management plans and vendor relationships, do your homework. Interview vendors. Be clear about your expectations. Talk to other independent agencies about their first year in business. Ask lots of questions and make sure you get what you need that fits your budget and your working style.

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3. Poor Planning

Most new independent agents don't have a complete idea of what to plan for when they start out. New agencies are often launched by great producers who aren't good business owners (at least at first). They need to develop a new skill set and understand and embrace the responsibilities of a business owner. Networking can be invaluable. Connecting with a peer group to figure out what typically lies ahead is critical.

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4. Missed Marketing Opportunities

In these technologically advanced times, there are countless ways to connect with and win new customers. For too many start-up agencies, however, I often see a marketing plan significantly out of sync with the times. These plans typically lack detail or the needed repetition and consistency to effectively market the new business to prospective clients. Door hangers and Penny Saver advertisements in the age of SMS messaging, social media and customized e-newsletters just don't move the needle as they once did.

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5. Misidentified Audiences

It happens across personal and commercial lines of insurance: Start-up business owners sometimes neglect to carefully identify their audience. What ends up happening is that these entrepreneurs—for whom time is truly money—spend far too much time pursuing individuals and businesses who don't match their target audience, rather than focusing on those who are a much better fit for their service offerings. For example, they'll invest dozens of hours prospecting and pursuing their big white whale—the game changer—unsuccessfully, though there are ample (and attainable) bass closer to shore.

Not every mistake is fatal to a start-up, but avoiding some of the common pitfalls of many new agencies increases the odds of success.

In today's environment, removing obstacles, adapting to realistic circumstances and understanding the risks of being a start-up are key in successfully launching an independent insurance agency. While the common mistakes noted above are just that—mistakes—they offer keen insight into mapping the future success of your business. Knowing what to expect and what to avoid might just be the best business advice you ever receive.

Jeff Holmes is the Vice President of Agency Operations & Services, SIAA and SAN Group, Inc. Under his leadership, SAN AccessPlus and Agency Development teams process more than 10,000 new business submissions per year and provide extensive mentoring for agents and staff. He has more than 20 years of insurance management, marketing, underwriting, training, sales, claims management and risk evaluation expertise. Jeff can be reached at [email protected].