The Impact of Growth, Cash Flow and Delegation.
Small businesses start in many fashions, but most of my clients’ businesses started from a passion—a hobby—that exploded into a business. This is awesome because the owner was doing something they loved and found a way to make money doing it, thus it turned into a full-blown business. Most times, it’s a one-man show…or maybe it’s a partnership and there is someone else helping out as well, but for the most part, all the work is done by only a few people.
There reaches a time in business where in order to grow the business, decisions must be made. There are some factors to consider. Those would be questions to ask yourself, such as:
Where do you see the company in five years? 20 years?
Where are you spending most of your time—IN the company, or ON the company?
What does growing the company look like?
In my experience, small businesses owners reach a point where they find themselves in a conundrum of wanting to grow (whether that be making more money, adding more staff, expanding the business in other ways), but in order to do so, they have to spend more money in order to make it happen. Finding the balance between keeping the cash in the bank or spending it in order to “grow” the business can be a hard flex for some business owners.
The hard reality is that when the business has been a “one-man-show,” there are only so many hours in a day, so many days in a week that one person can get work done. There is only so much work that one person can do before they have to outsource, or bring on someone else to carry the load. Or maybe it is in order to expand, you need to find something to do tasks that are not revenue generating so that the owner’s time can be freed up on revenue-generating tasks.
At this point in the ownership of a business, knowing the long-term goals of the company are important. What would success of the business look like? It is different for everyone. Is it measured by profit, longevity, people touched, services offered?
In order to grow the business, in any direction, cash flow is going to be a factor. Additional employees will bring payroll cost, additional inventory will require more money or increase accounts payable. Additional outsourcing will be cash leaving the bank and going somewhere else. However, with these added expenses, the owner(s) have room to expand. They relieve some of their duties and delegate them out, leaving themselves open to do more revenue-generating tasks. What they do with their time could be any number of things, whatever they see is the next step to growing the business. But in order to make it to this step, they have to realize that there is only one of them, and they need help getting all the tasks that have inadvertently fallen on them, done.
Reaching this point in the business is scary. This is usually when I hear clients say, “But now I feel like I’m responsible for someone else’s livelihood.” It can be scary, but it can also be liberating. Because I also hear clients say they’re having to fulfill tasks that drain them. Do you hear that? They started this business from something they love and now they’re fulfilling tasks that DRAIN THEM?!? That’s when I tell them that it’s time to get some of those tasks off their plate. Because sooner or later, having to do those things is going to cause them to hate their job. A job they work for themselves doing. And that in itself sounds like a hamster wheel way to live.
For small business owners, finding the freedom within themselves to outsource work and opening-up more time to generate revenue is often the first step in growing their business.
It’s time to get back to why you started your business in the first place. To feed that passion piece and ultimately grow. Contact us here at Core for things you don’t want to do – involving those business taxes, filing, accounting, bookkeeping, payroll etc. We can take those things off your plate so you can ultimately focus on your business and your “why” in the first place. We can help you grow but first make that step. Call us today.
