" ... Despite best intentions, hurdles invariably loom. Overcoming and learning from them is part of the journey and can build an even stronger business long-term."
Growing a successful business isn’t always plain sailing. Despite best intentions, hurdles invariably loom. Overcoming and learning from them is part of the journey and can build an even stronger business long-term, as our recent Godalming Business Club session concluded. For more information please read this article on Turning a setback into a success.
Throughout our 80+ years, Shipleys has helped thousands of businesses to grow. That experience has taught us that while every business is unique, there are common challenges to growth. In addition, there are usually a few curve balls thrown in from the political, legal and economic spheres.
Finding the right team
One common hurdle is having enough people for the business to run effectively. With the current job market, recruiting extra people can be tough, so consider upskilling or training existing staff, different promotion routes or even outsourcing. But remember, there’s a delicate balance required here – you don’t necessarily want to staff up too quickly.
Recognise that as you grow the capabilities of your people will need to change, for example, having additional responsibilities, covering more territories or service/product lines, etc. Make sure you plan ahead for this. For more information please read this article on Motivating Your People
Over the past decade, many sources of finance have emerged. Some assume, after the last recession, that banks aren’t interested in financing but that’s not necessarily the case. Newer providers, such as Funding Circle and iwoca, regularly promote financing to small- and medium-sized businesses. Companies have also set up to help investors benefit from tax savings via the Seed Enterprise Investment Scheme (SEIS). They therefore need to find companies to benefit from SEIS funds. And with continued low interest rates, more individuals are investing in a business run by a friend or family member or through crowdfunding platforms.
So, finance for growth is quite widely available, but think carefully before making a decision – for example, consider what conditions are attached. And don’t forget to first make the most of tax reliefs and allowances. They can help cashflow and reduce corporation tax so you can invest more in the business. For more information please read this article on Making the Most of Tax Allowances to Fuel Business Growth
As it expands, your business might get too big for its premises.
With different property and employment costs across the country plus improvements in technology and logistics, some businesses are questioning the need for expensive offices or production facilities.
Permitted Development Rights were introduced in 2013 to incentivise developers to convert disused commercial property into housing. This has led to a shortage of commercial property in some areas.
So, when it comes to premises, have an open mind. Flexible working, access to good distribution routes rather than a high street presence and scalable premises are all helping business owners find more agile solutions to their growth needs.
Aligning leadership and management
When a business gets bigger, lines of control can become stretched, and the distinction between leadership and management becomes important. Senior team alignment makes it easier to make and implement strategic decisions. So, periodically:
- check different attitudes to risk among the leadership team – it’s fine to have a mix, but clarifying contrasting views is very helpful
- decide what your growth ceiling is – some business owners feel they don’t want the business to grow beyond a certain level, as it will lose its essence
- review your business plan so it takes account of current market conditions – it should be a living plan focused on your growth.
- factor in different scenarios and break-even analyses – so you can anticipate and prepare for alternative paths growth may take.
Forewarned is forearmed when growing a business. Accept that growth will be an exhilarating and often bumpy ride. Prepare for it and enjoy it. Along the way, help yourself and the business by putting in place the right team, shared goals and valued independent advice so you can move forward as smoothly and successfully as possible.
If you would like to discuss growing your business, please speak to your usual Shipleys contact.
Specific advice should be obtained before taking action, or refraining from taking action, in relation to this summary, if you would like advice or further information, please speak to your usual Shipleys contact.
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