I remember having my first ever business coaching session together with about 12 other accounting firms in Brisbane. This was more of an initial Planning Session over 2 days and it gave me a huge insight into how bigger firms (doing anywhere up to $6m turnover p.a.) run their businesses. More specifically, I had an inside view of the top challenges faced by businesses of any size, and they all seemed to be facing the same issues.
Now, working closely with small businesses turning over between $1m to $20m, I have found there are 3 common challenges they face and funnily enough, they are the same 3 challenges each accounting firm wrote on the flip chart at our business coaching session that day. If you are facing any or all of the following challenges, rest assured, there are millions of other small businesses out there fighting the same battles.
Those top three challenges are:
- Cashflow: I couldn’t say it enough – Cashflow Is King. It is easily the most common problem businesses face as they grow and the issue is only ever exacerbated unless a proactive approach is taken. When we engage a new client, our first project is a Planning Session and nearly always the next step is to work on cashflow. Once cashflow strategies are in place, the business can then safely grow and scale. This problem causes a lot of stress and sleepless nights for business owners and is number 1 on my own list of challenges.
- Growth: ask a business owner what they want to achieve from their business in the next 1, 3, 5 years, and the answer is usually “I want to grow my business”. But what does that really mean? It could mean opening another storefront, building a bigger team or increasing sales. Many businesses struggle to grow because they don’t actually know what targets they want to reach…so how will they know when they finally touch that point? If it’s to increase sales, then you need to determine what really drives sales in your business, what metrics need to be improved and then put in place a monitoring program to keep your goals on track.
- People: they are not your most important asset, the right people are. This is one of the most important aspects of starting and growing a business. It is a very common scenario that as a business grows, the owner’s working capacity fills so they employ a team member to increase capacity and so this continues. Unfortunately, a main strategy here is “the squeaky wheel gets the oil” which means the department that screams the loudest will get the additional help. But are you really hiring the BEST person for the role? On the contrary, owners are then slow to fire when the person isn’t right for the business. Successful businesses get the right people on the bus before they decide where they are going and how to get there. Consider that going understaffed for a while is better than having a non-constructive team member, and that if someone needs to go, don’t put it off.
What are some of the other challenges your business is facing? Feel free to comment below and share!