Invariably, any discussion about ways to grow your business will talk about the major routes to growth – the big, strategic decisions such as expanding the product portfolio, exploring new geographical markets, or mergers and acquisitions.
But let’s take a step back. When you’re thinking about growth, it’s best to start with the basics – because in our experience, this is often where the barriers will be found.
There are two fundamental resources that a business owner needs in order to successfully grow their company:
- Time to think. Owner managers need room to think about what their medium and long term plans are for the business.
- Good information. The best business decisions are based on reliable, timely information – what’s happening now, not what happened six months ago or more.
Both, though, are often in short supply. Owner-managers often tell us that they are so busy with the day-to-day running of their business that they don’t have time to really think about what they want to do with the company in the longer term. So, what can an owner-manager do to carve out the time they need?
Better records
One of the most effective ways of creating time is to get the company’s accounting and record keeping into shape. Business admin is usually seen as a pure cost, but the reality is that financial and management information is an important resource if it’s generated at the right time and used in the right way.
Too often, we see businesses fall behind in their bookkeeping and accounting, with the result that they are constantly racing to keep up with filing deadlines. Accounting becomes a backward-looking chore, rather than the source of valuable insight into how well the business is running and where future growth opportunities may lie.
Lean on your accountant
Inefficient accounting and record keeping can have a knock-on effect, in that it also ties up the business’ advisers in tasks that can’t add value. Any accountant will tell you that at some point in their career, they have spent huge amounts of time sorting out a client’s books. It’s work that brings benefits in terms of avoiding the wrath of HMRC, perhaps, but it’s only a fraction of the real value that a partnership between accountant and small business can generate.
Owner-managers are often the sole decision-maker and that can be a lonely role. A good accountant will act as an experienced and informed adviser, not unlike a non-executive director – independent of the business and familiar with it, but not emotionally immersed in its detail.
They can be a valuable sounding board and a support through difficult times – and if you are facing a particular problem, it’s likely that they (or someone else in their firm) will have already helped another business through something similar.
It makes sense to use your accountant where they can add the most value. An accountant can spend most of their time catching the business up on its statutory filings, or they could spend it reviewing your quarterly accounts, comparing budgets with actual outcomes, highlighting fluctuations in revenue and spending, and talking through the implications.
Technology is the answer
Large companies routinely use automation in business functions such as finance to reduce cost and increase efficiency. This frees people to work on adding more value and generating valuable data that powers their business decisions.
The same principle applies to small businesses: the huge range of software solutions available take the strain out of basic bookkeeping and create accurate data in real time that provides genuine insight into the company’s performance.
These solutions provide an affordable, easy and efficient way to manage finance admin and keep track of revenue, cashflow and expenses. A team of professional accountants (like our BKL Advance business services pods) can help you make the most of technology to produce up to date, good quality and timely financial records – and then will add another dimension, analysing the financial data, explaining what the figures mean and using the data to illustrate the implications of future decisions.
The focus shifts: the business is looking ahead and using data to understand its strengths, weaknesses and options, rather than spending too much time explaining to others what has already happened.
Time is money and data is power – so get the basics right and help your business grow.
For more information about how we can help you with the basics and the complexities of growing your business, please get in touch with your usual BKL contact or use our enquiry form.