Running a small business is never easy, but it can be extremely fulfilling for the entrepreneur who makes it work. The early days of any new business revolve around market development, cash flow, and general administration, such as keeping compliant with laws and regulations. Whether the business provides services or products, there are many necessary things to do in order to ensure that the business not only survives but also thrives.
So what happens when a small business is ready to grow?
Planning for growth
When the initial start-up period is over, many small businesses think they can run before they walk. Ambition is a great thing when it comes to growing a business; but beware of over-ambition. Business owners should plan their growth with care so as to not only keep their current customers but also maintain the quality of service they have provided while developing new markets.
There are a number of factors to take into account when planning business expansion. If working from home, will the business be able to handle growth from that base, or would it be appropriate to move to rented premises? If a decision is taken to move, then all the additional costs associated with that must be evaluated. In addition to the rent, there will also be utility bills and insurances, and if products are being made, there will be extra costs for raw materials and manufacturing, packaging, etc.
Correct financial budgeting is essential, and a solid business plan outlining development for the next two to three years should be prepared. If overdraft facilities or a capital loan are needed, this is the document that a bank or other lender will want to see. It is important to be realistic and to demonstrate that the plan has been carefully thought through, the figures add up, and the potential for real growth is clear.
Employing others
When a small business starts to grow, it can become a burden for just one person to continue to do everything. The entrepreneur needs to keep focused on the core of the business, because that is where the profit lies. At some stage, a decision will be needed as to whether to employ others, and how that should be done. Employing anyone, whether full or part time, means that payroll has to be handled and the appropriate insurances secured. There are costs associated with recruitment, reviewing applications, interviewing, and all the while the business must continue to operate.
Administrative assistance
For many businesses it’s the administrative requirements that can prove a problem. One way of handling this is to use an umbrella company, such as Crystal Umbrella, to take over the day-to-day administrative tasks of running the business, such as invoicing, preparing tax forms, and offsetting business expenses. It is an attractive solution that frees up the entrepreneur to concentrate on further business growth.
Luke Davis is a freelance writer specialising in the business and finance sectors.