Growth can be a thorny topic. If it’s not planned for it can leave you reeling and unable to keep up. But planning for growth isn’t always possible. Sometimes it just, well, happens! Here, a range of experts share their tips on growing your small business.
Vic Ciuffetelli, CEO, ActionCOACH
Should every small business be trying to grow or should some stay small?
Every business should have a clear business plan, particularly those wanting to grow. This plan must identify how your business will grow, identify potential dangers and specify solutions. Growth should be profitable, not just for growth’s sake. Profit is king, size is ego. Business owners need to decided how to grow, which depends on what level of growth and in what time frame. A small business that experiences unplanned growth could lack the capital, staff or infrastructure to handle a huge growth in the business, which would have a detrimental impact.
What mistakes do small businesses make when trying to grow and how can they avoid them?
So many small business owners make the mistake of working in their business rather than working on it and this mistake can sap all their time, leading to mistakes and usually a struggling business. If business owners are more concerned with the day-to-day activities of their business, they are losing sight of the big picture. They aren’t concentrating on making their business grow; instead they are focused on maintaining the status quo. Even if your status quo is solid, without an eye toward the future, your business is sure to eventually stagnate and suffer. The key to owning a business that thrives and continues to grow is finding the necessary time to work ‘on’ your business rather than just ‘in’ it. Half a day each quarter should be devoted to this activity. For most business owners it’s a discipline that that they’ll ‘get around to’, but never do.
Priscilla Dickason, Group Product Marketing Manager, Epson Australia
How can technology help a business grow?
Business moves faster every day. Those who run their business at full speed using cost and energy efficient technologies and smart people will always have an advantage. To get that edge, comprehensively understand your customers, competitors, suppliers and markets. Then think strategically about where you want your business to go and create a technology plan and budget that includes current and emerging technologies that will lead/support growth and add value.
Make sure your budget includes training (at least 10 percent of your salary budget: technology is only ever as good as those who operate it). The technology plan is critical. Without it you may make ad hoc decisions to replace old systems and software that will soon limit your growth when what you should do is invest a little more and make that technology leap to next generation platforms that improve workflow, reliability, durability and productivity.
The core of the plan ensures that critical components: storage, backup, security, network, printing and scanning, internet links, email and website, are nurtured and maintained so downtime is minimal. The visionary part targets those apps that will accelerate growth such as remote and cloud printing solutions and direct wireless printing from smartphones and tablets.
Share that plan with your trusted IT supplier and ask them to advise you about new devices, apps and software as they are released. Your local reseller or systems integrator will welcome the chance to deliver outstanding service to a business that knows where it’s going and thinks big.
Tim Reed, CEO, MYOB
How can a small business decide if it’s a good time to actively try and grow or does this just happen?
Growth generally needs to be planned and driven. The ‘right’ timing depends on many factors, most importantly your desire to grow. Growth often requires a time and money investment.
Market conditions are another. It’s easier to grow in an expanding market than a flat or contracting one. Businesses may grow at different times, driven by different factors, eg. industry, region, specialty, reputation and marketing. While these latter factors can be controlled, the local economy cannot.
Having the right systems and processes, like an operations manual and reliable business management software, lightens paperwork and allows time to focus on making sound growth decisions.
Finally, ensure you’re confident the expected income increase will cover debt or profit sharing arrangements.
What are the common mistakes small businesses make in managing their growth and how can they avoid these?
A common mistake is underestimating the time and dollars needed to keep your operations performing while you pursue growth. As EOFY approaches, you face one of the heaviest compliance years in some time. Changes include the new carbon tax, the flood levy ending and compulsory superannuation adjustments, among others.
The carbon tax, if well planned for, should be positive for many SMEs. Understand how it impacts your costs, develop a pricing strategy, ensure payroll software is updated and plan local campaigns to hit when consumers have extra spending money.
The second mistake is timing, eg. on July the Government allows businesses to write off asset purchases of up to $6,500 (up on $1,500 currently). Consider putting off investment until 1July when there’s a bigger tax deduction. Talking to your accountant about growth investment timing is critical.
Emma Hunt, Head of Small Business, PayPal Australia
How can SMEs use ecommerce to grow their business?
With over nine million Australians shopping online, small businesses can use online commerce to access new customers, both in Australia and overseas, that are beyond the reach of their traditional bricks and mortar stores. With an online presence, a store can be open 24/7, allowing small businesses to sell whilst they sleep, giving customers the ability to shop anytime from the comfort of their own homes.
Why are the online opportunities so big?
Australian online retail is experiencing phenomenal growth, expected to reach $31.7 billion in 2012. Australians overwhelmingly prefer to buy from local retailers, with domestic retail accounting for 70 percent of online spending in Australia. This presents a huge opportunity for Australian small businesses to tap into a sector that is experiencing rapid growth.
Can any business grow by selling online? Should all bricks and mortar sellers be selling online as well?
Small businesses should embrace a multi-channeled approach to reach customers wherever they are shopping. However, before diving in, it’s important to make sure you are set up to deliver an excellent end-to-end customer experience, whatever channel your customer is using. Intuitive website navigation, an engaging user experience and detailed product information, shipping, returns and a secure and convenient payment solution all play an important role in creating a great customer experience online.
Brett Kelly, CEO, Kelly Partners
What should small businesses be wary of when trying to grow?
Before trying to grow a business the owners must be clear of why it exists and who it seeks to serve. This understanding should be turned into a uniquely attractive proposition (product or service) for a specific type of client. If your business cannot genuinely improve the situation of the client you seek to serve then you will be selling instead of serving – best to find something better to do. This is the biggest danger businesses face trying to grow something that there is little or no demand for – in a sense a business that is doing the above cannot help but grow and the owners job is to direct and steer that growth ensuring always that the promises of the business is delivered consistently.
How can they achieve sustainable growth?
The key to sustainable growth is two fold: great listening and overwhelming consistent disciplined action supported by excellent systems. Where the business is truly serving a need in a unique way desired by clients, growth tends to look after itself if the business can look after the growth.
What are the most common mistakes SMEs make in trying to grow their businesses and how can they avoid them?
· Lack of clarity around why they are in business, who their ideal client is and what their unique proposition is to that client
· Being unable to attract, retain and develop the talented team members required to continue to deliver the businesses promise
· A focus on growth instead of service – great service drives growth.
Here are some top tips from Suncorp Bank‘s manager of payment systems David Spence to help grow your business:
- Know your customers and what your competitive advantage is. From here you can plan your marketing activities and staff training.
- Deliver top-rate customer service. Service with a smile does not cost you anything and it keeps people coming back. Listen to your customers and provide them with what they need.
- Connect with associations and support groups that provide a voice and support to small business. These groups will know which government departments to speak with to seek financial guidance and assistance, as well as providing a plethora of networking and business improvement forums.
- Keep an open relationship with your bank and accountant. By seeking expert help you can plan, identify solutions to potential problems and improve the chances of your business surviving any rough financial periods.
- Offer clients a variety of payment methods including BPay, direct credit, credit cards and EFTPOS. By making bill payments simple, you’re more likely to keep customers coming back, and as an added bonus, you’ll help achieve better cashflow management for your business.