Five myths about business growth & how to overcome them, Part 2
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Build it & they will come!
We see it often – massive fit-outs of business premises, fortunes spent on new equipment etc.
Business owners get excited about creating a fantastic product or service, but forget to tell the market! Sales don’t grow quickly enough to fund the extra costs outlaid and cashflow squeeze becomes an issue. Marketing is often not the strong point of business owners and they don’t have the funds to employ a marketing person.
Solution
- Budget for sales required to cover costs of fit-outs, extra equipment etc. Workout a ‘break-even’ point and make this your targeted sales to cover costs.
- Have a marketing plan and let your market know of your new product or service.
- Employ outsourced marketing help if you can’t afford to employ someone. Marketing is not a ‘cost’ it is an investment in building your brand.
When you decide to grow, you need to take a different view of things. You need to become a business manager and not just a doer.
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I can cope!
Business owners often fall into ‘the Founder Trap’ (a term coined by author of The E Myth, Michael Gerber).
It’s when a business owner thinks they are the only person who can do things and doesn’t trust anyone else to help.
The problem with this attitude is that other aspects of your life suffer, e.g. your sanity, your health, your home life etc. When you start off in business it’s obvious that you have to be jack-/jill-of-all-trades and do anything. When you decide to grow, though, you need to take a completely different view of things. You need to become a business manager and not just a doer.
Solution
- Build a picture of what your business will look like when it has grown.
- Prepare an organisational chart setting out all the tasks that need to be performed and who will do them.
- Write up job descriptions for the people who will be involved.
- Consider what systems will be needed to create efficiencies.
- Gain skills or outside help in HR management. Employing people doesn’t make your life easier – it’s a whole new skill you need to master.
Sue Hirst, Co-Founder and Director, CFO On-Call, cfooncall.com.au
