How to be more productive in small business with effective planning and execution
Productivity in small to medium size businesses is one of the greatest challenges facing the business owner. As the business owner there is a tendency to want to carry out all the business functions yourself. This is fine until the business grows to a level where it becomes impossible to manage the business and things tend to then spiral out of control. To avoid this the business owner must recognize the stage and need for additional resources and implement planning and strategies to execute appropriately. Generally, the business record keeping is the first thing to suffer and usually falls to the bottom of the priority list and that is when the real headaches can start.
If you don’t have time to chase customers for payment, then you won’t have cash to pay your suppliers or staff super or BAS obligations which will see the business performance really start to deteriorate.
Simply put, know when your business needs help from outside resources and don’t be afraid to ask for help to avoid productivity grinding to a halt and escalating stress levels.
Cost vs benefit of engaging a reputable business accountant or bookkeeper
Small business accounting has recently been turned on its head with the advent of cloud based small business accounting software platforms. The marketing behind these platforms is very slick encouraging business owners to attempt small business accounting without the input from a reputable business accounting or bookkeeping service.
This is where disaster can strike as the setup of the business file is something that needs specialist knowledge to avoid costly rework by your tax accountant at the end of the financial year.
For example, as the business owner, say your time to customers is billed at $80 per hour. If the business owner takes six hours to complete their small business accounting work, that creates an opportunity cost of $480 to the business as the business owner is working on the business accounts and not out creating sales for the business.
Furthermore, if a reputable business accountant or bookkeeper charging say $60 per hour, takes three hours to complete what it takes the business owner six hours to complete leads to a far more acceptable cost benefit as the business owner gets back the opportunity to generate $480 in income i.e. 6 hours x $80 per hour while it costs only $180 i.e. 3 hours x $60 to engage a reputable business accountant or bookkeeper to process the small business accounting requirements. That is a potential benefit of $300 income and the peace of mind their small business accounting records are up to date and in good order.
Is your business a job to you or something that you are passionate about?
The transition for employment to running your own business can be a difficult course to navigate if your mindset is not on the changes that will come to your life across the board when you start a small business. Any experienced small business owner will tell you there is no such thing as nine to five when owning and running a small business.
As a SME owner you have to have the passion for hard work to achieve success in operating a small business.
The small business process won’t work unless you invest in the relationships around you
The biggest change in moving into the world of owning and running a small business is realizing that you are the sole decision maker around the demands from the business that come your way. Quality relationships with customers, suppliers and external service providers are essential to have in place as they are thread that binds all relationships together to help run a sort after and successful business. Arrogance or disrespect in relationships with customers, suppliers and external service providers will sour the business prospects very quickly. Be positive to all aspects of your business relationships, particularly when tough times are around, the hard work you have put in to maintaining good business relationships will pay off when you get support from those businesses when you need it most.
Understand the consequences of making tough business decisions
Sometimes making tough business decisions can become almost impossible to make. If a serious situation arises, take time to find a quiet space and plan out the elements of the tough decision(s) required and what you may think the possible consequences might be. Once you have the elements identified, there is more chance of the small business owner achieving the outcomes desired around these tough business decision(s).
Your small business is your responsibility
One thing to quickly learn for the small business owner that the “buck stops with the small business owner”. Particularly as the sole small business owner, responsibility for decision making and the subsequent consequences of those decisions are the sole small business owner to own, this is non-negotiable. Hence, as the small business owner, own all decisions, both good and bad, and the responsibility for the outcomes of those decisions.
As a small business owner, look after your mental and physical health
Owning and running a small business can bring challenging situations, particularly with the experience of difficult business trading conditions These stressful experiences can be magnified in intensity if either your mental or physical health is compromised.
Look after yourself, eat well and be kind to all around you. If you are struggling in anyway, see your GP as a priority to ask for support to get through what difficulties you are facing either as a small business owner or at a personal level.
Both outcomes affect the other, don’t think if you are ok personally, that you can manage stress in the business. It will only be a matter of time the stress in the business will wear you out and you will start to suffer in your personal life.
Enjoy the rewards of running a successful business
In the ebb and flow of business life, there is something that sometimes can be neglected or not even thought of. Please make time to enjoy the rewards of running a successful business, it is something you have earned and deserve to indulge in. It is simply a stunning moment to recognize achieving your goals, both in business and personal life.
With thanks to our guest author:
Business Management Geelong