As a business coach who has been around the block several times, I’ve seen it all. Many business owners are looking for ‘world domination’ and there is nothing wrong with that – as long as you are making money! Well, that is, if making money is one of your goals.
Big Business or Good Business – What Do You Choose?
Do what you want to do
Don’t just go for ‘world domination’ unless that is what YOU want. If your goal is to have five locations around Australia (been there, done that) then great, but there is also the business owner who simply wants to stick with one or two staff (or even be solo), do great work, not be stressed and have a nice little business. We are all different and unique and whilst the large business with huge turnover might be perfect for some, I appreciate that many others are happy to keep it small. End of the day, don’t do what society expects, or your friends, or even your business coach. Have a sized business that is what YOU want. As I often say to my clients during business coaching sessions – “it’s all about you”.
Know your ‘why’
Why are you in business? What’s important to you? For some of you, we have a drive which won’t allow you to just stop at a certain level; you are constantly striving for more, greater or better. Others strive for lifestyle or family time. It’s interesting; often people go into business for two main things being (a) money and (b) flexibility and time. Thing is, once they are there, sometimes you are lacking both – at least in the beginning. Strive for big for the right reasons. There is an expression I love this:
The benefits of a big business
There are quite a few and most likely it’s that success factor, making money and leveraging the time and skills of other people. A large business gets you known and certainly gives you satisfaction. It can also generate a very nice sum of money and there is nothing wrong with wanting that. However, on the flip side, it can require substantial capital and investment, a heap of time, effort, energy and yes, even tears. To grow, you absolutely need a team and with that comes its own set of challenges. Though once you have things running smoothly, the good news is that you can often step back (just a little) and allow others to do their job. I do always recommend that as a business owner, you still stay involved to some level. I had an experience myself with a manager who wasn’t performing. Fortunately, I was monitoring things closely and all over the reports. Seeing a pattern start to emerge, I was able to step in and adjust things promptly to get that business back on track.
The benefits of a smaller business
I won’t say it has less stress all the time, but it can. It can also have less money and less potential. Often the smaller business relies on the business owner more strongly, but that also means you can have a business which runs pretty lean and is flexible. Take Covid-19 for example – the small businesses were able to adjust really quickly and handle the situation. Larger businesses can often get caught up in meetings and memos and not actually make the changes needed as quickly as possible. Often also the smaller business has less overheads. This means if times get tough, they can adjust and adapt quickly.
Systems, processes & protection
What can be lacking in smaller businesses is sometimes clear and documented systems and processes. Often a smaller business has not done critical things like a risk assessment. Frequently they don’t have planning in place or even a documented marketing strategy. Now, let me say, I am generalising here. I myself am a small business and I have all these things. I believe I should practice what I preach! The point here is that often the larger business has these things in place as standard operating procedure because they not only see the value, but the experience of the collective team knows the value. When I commence business coaching with a client, often their focus is on getting in leads, making sales and improving their bottom line. It’s not often that a small business owner will say that they want great systems and documented processes. The thing is that a great system means everyone is doing things in the best possible way with consistency and efficiency … which brings me on to my next point.
Lean & Efficient
The smaller business often runs leaner. There is simply not the need for a heap of management, admin staff, accounts department or marketing branch. Instead often people have multiple tasks. Sometimes that’s good, but sometimes less so. A great receptionist may not be particularly great at Xero or MYOB bookkeeping. Having less overheads and costs means the business is often generating greater profit levels – as long as there is efficiency. Above I talked about documented systems and processes and this is something some small businesses lack. What that means is that the business without these is often ‘flying by the seat of its pants’ and does not have uniformity or consistency and is probably not doing things in the best possible way. There is likely a lot of trial and error and without documented processes, a new team member is probably just going to do it their way which might well mean duplicating that trial and error phase.
So what do you do?
- Know what you want and have clear goals. Having goals gives you short term motivation and long term clarity and vision.
- Have a plan to achieve those outcomes. It’s a statistical fact that a person (or business) who has a written down plan is far more likely to succeed. Not enough time is invested in the planning of a business’ success and frequently any planning which is done is not documented, reviewed and certainly not linked back to a budget.
- Regardless of the size of your business, make it the best it can possibly be. Having systems, processes, great team and a strong bottom line is something every business owner should be aiming towards.
- Remember that even a small business can access ‘experts’ in their field. This might be a contract bookkeeper you engage 3 hours a month, or a marketing person who runs your Google PPC or Facebook ad campaigns. If you’re looking for such a contractor, I know a fellow Aussie who does this very well and can introduce you.
- If you are a smaller business and don’t have all those department heads to help you run the business, then consider a business coach. Look for someone (yes like myself) who has decades of business experience and the experience of hundreds of businesses and who has the knowledge and expertise and accountability methods to keep you on track.
The top 5 reasons that a business fails is:
- Too much debt
- Badly managed cash flow
- Lack of effective marketing
- Ineffective leadership
- Attempting to do it all yourself.
98% of business failure comes back to poor management. That equates to lack of skill or knowledge, burnout, wrong team, preparedness, research, poor marketing, wrong pricing, planning, cash flow management and expertise. At last 2% are the things we have absolutely no control over, such as a disaster. This is where I can help (and in many more ways). With qualifications in accounting, 30+ years of experience, I know money, marketing, sales and so much more. You won’t be ‘doing it alone’ as I am your ‘partner’ in business – without a piece of the pie. Call me!
Read Taking Control.