You’re not the first business owner to have asked this question and you certainly won’t be the last! Once you’re past the initial start-up phase it’s natural that you’ll want to shift your focus to building your fledgling business. Developing your company to ensure long term success is a challenge. Growing too fast can cause you to run out of money whilst turning away work can just enhance income for your competitors.
Here are 4 steps for scaling up your new business…
Step one: Plan ahead
Analyse what you’ve already done to get your business to the stage you’re at. Whilst it might appear painful to dwell on negatives and indulgent to rake over successes it’s a valuable process to consider what went right and wrong and what you learned along the way. It’s helpful to analyse your spending to gain insights into what represented good and bad investments. For example, you may have decided to outsource work to contractors or agencies with specific skillsets such as marketing or social media, however, as your business moves forward it may represent a better investment to have these roles filled in-house.
Create a short term and long term plan and make sure the two are aligned, it is all too easy to get caught in the moment and lose focus of your long-term plans. An increasing number of small and medium sized businesses are updating their plans annually with some even altering them every six months. This is a useful strategy to drive your business forwards toward your long-term goals.
Finally, share your plans with your employees. Despite being at the helm of your business you’re not going to be able to grow it alone. Make sure that staff are aware of your plans and that they can contribute to them. Communicating your plans effectively is central to making them a reality.
Step two: Research your financial options
To avoid being stuck in a financial rut take the time to carry out research into the best deals available for your business whether it be commercial mortgages, invoice financing or bank loans. As a business owner, you need to be aware of the alternative options, although funding is key for a business it shouldn’t be a reason for delay or failure. Going via a bank can become expensive and there is a chance of getting declined.
Chose a lender which suits your business needs. Business bank accounts and loans offer different products and services so compare what’s on offer to get the right deal for your specific business requirements. As your enterprise grows and you need different financial support then consider switching your business bank account. If you need to buy equipment or machinery, then contemplate asset finance. A massive 82 per cent of SMEs are unaware of alternative business funding options and 60 per cent of SMEs are currently spending less than an hour researching lending providers so take the time to carry out your research online or over the phone.
Have confidence that you can take control of your business finances and select the deals that are best for your firm. Comparing and switching deals to save money is very much within consumer culture now with many of us sourcing the best deals for consumer energy, insurance and mortgages. There’s no reason why business owners shouldn’t carry out the same process for their business energy, insurance and commercial mortgages. After all, the costs are likely to be more and so are the savings! Always make sure that you are fully aware of the terms and conditions of the loan or finance agreement.
Step three: Invest time in quality recruitment
If you’re scaling up your business, then it’s likely that you’ll be taking on new staff to help you grow. Take the time to pinpoint exactly what skills and experience you require from your new members of staff. Be clear and accurate about what you want from a new employee and what you can offer in return. Look within your existing staff to consider whether you have any potential candidates. Is there any training you can offer to support their professional growth and equip them for the emerging needs of your business?
Consider the practical implications of taking on new talent and the financial consequences for your business. For example, new equipment, training budget or even larger premises. Increasingly SMEs are turning to virtual offices with staff working from home.
Whatever you do, don’t panic employ – if you fail to entice the right candidate the first time around then be patient and re-advertise. Investing in people is investing in your future. With a talented and dedicated workforce, your business is far more likely to thrive.
Step four: Make savings where possible
Raising the capital to grow and develop your business could mean tightening the purse strings elsewhere. Make sure that you have the best possible business energy, banking and finance rates.
Don’t just concentrate on the specific areas of growth but look to improve and economise on how you already organise your bills and finances. There are savings to be made and identifying them does not have to be a long, complicated, time-consuming task.
The Federation of Small Businesses (FSB) claim a third of small firms highlight the cost of energy as a barrier to the growth and success of their company. Despite this, 70 per cent of enterprises experience difficulty comparing energy tariffs and 43 per cent have never switched supplier. Not only that but many small business owners are failing to carry out even the most basic actions to save on gas and electricity bills.
Keep on top of the costs and fees associated with running your business finances. It was recently revealed that small and medium sized enterprises have been charged £4 billion per year in hidden bank costs to transfer money internationally. Being shrewd with your business costs can make all the difference when it comes to upscaling your company.
Ultimately, you should be aware that, while you are growing your business, the structure of your operation is likely to change. There will be new costs, expenses and challenges associated with this stage so it’s wise to stay on track with company finances and, ideally, success will follow.