SMEs make up 98 per cent of Australian businesses and typically turn over between $100,000 and $50,000,000 annually.
With so much riding on the average small business, why do so many business owners risk it all by having poor planning within their businesses?
What we have found in our 85 years of working with SMEs is that often, the business owner doesn’t fully understand the crucial five elements that need some forward planning.
When a business takes some time upfront to get organised, it can dramatically improve business outcomes in the long term.
No matter the size of your business, it’s important to outline your goals and have strategies in place.
We’ve outlined the five key areas that we believe will set your business up for long term success and help you avoid some common SME mistakes.
- Human Resources (HR)
- Sales and Marketing
- Operations and Processes
- Information Technology (IT)
By working with a qualified business advisor to follow these steps, you are well on your way toward securing your business future.
A common cry for help from SME owners is often related to their cash flow. Regardless of the business, you’re running or how good you are at your craft, at the end of the day cashflow is what you’re tracking. Throw this in with trying to work out tax minimisation strategies and risk management and you’re already getting snowed under – and this is only one pillar out of five. Identify your high and lowcash flow periods and be prepared for any unexpected expenses that may arise. And, if you struggle to get your head around it, get help, and get help early. Pre-planning will save you lots of headaches.
Human Resources (HR)
Your employees are your business. These are the people that you trust to help you achieve business success. You’re paying these people to ensure your daily business operations run smoothly, effectively and efficiently. Make sure they know why they’re there, give them clarity around their job roles and responsibilities, set clear expectations and hold them accountable. We find the key to having good people is communication. Communication is the answer to everything and can solve majority of your problems – before they arise.
Sales and marketing
Do you know what your brand is? (and no – it’s not your logo!) If you don’t know what your brand is or what you stand for, how can you expect your customers to? Clarify what your brand is and identify who your customers are. Then, you can start mapping out your sales and marketing strategies and maximise your budget with targeted marketing. Your marketing plan will reflect the periods you have just identified as your high and low cash flow periods.
Operations and processes
It is essential that your internal systems and processes reflect you and your business needs. Ensuring your processes and procedures are up to date will save your staff time – and remember, you’re paying them for their time. If you can make it a priority to regularly review your procedures, you’re setting yourself up for efficient work practises.
Information Technology (IT)
Make sure your IT is led by your business. There is no point having software in place if it is not meeting the everyday needs of your company. Choose IT systems that make your life easier, are simple to use and add value to your business.
Shaun Langdon, CEO, Strategem