A lot of people dream of owning their own business—doing what they love, being the boss, and making a fortune.
But then the harsh reality of owning and running a business takes over, and their dream is all but forgotten as they deal with the responsibilities of:
- sourcing and tendering for work
- taxation compliance (e.g. GST, BAS, business tax returns)
- cash flow
- customer issues.
It’s at this point that many business owners become disillusioned. Some may even ask themselves, “Should I just got back to working for someone else?”
And it’s a fair question. At the very least your business should give you a bigger income than you’d get doing the same work as an employee. If it doesn’t, then you may well be better off closing your business and working for ‘the man’. Sure, you wouldn’t have the freedom or the authority. But you wouldn’t have the stress or the sleepless nights, either.
Thankfully there are ways to improve your business.
Keep the dream alive
Fortunately, a lot of people still believe that owning a business gives them the opportunity to increase their income, create financial freedom, and improve their wellbeing.
And I’m guessing you’re one of them.
But sticking with something you find frustrating rather than satisfying is tough. Really tough. So if you aren’t satisfied with your returns, or you’re constantly getting frustrated by compliance and paperwork, you need to take control of your business.
Spend some time reviewing your business. Why isn’t it generating the financial returns you expected? How can you resolve these issues?
Think about how you do things. What could you change to improve your business’ efficiency and profitability?
It doesn’t have to be a major change. It could be something simple, like invoicing customers at the point of service, rather than mailing it out when you get back to the office.
That may not seem like much. But the quicker you invoice the quicker you can be paid, which can make a big difference to your cash flow—and your business.
Will it sell?
Another great way to review your business is to ask yourself, “If it was for sale, would I buy it?”
Well, would you?
Your answer may well be “No”. You may think there’s something wrong with it, or that it isn’t achieving its full potential. But whatever the reason, if you wouldn’t buy your own business as it stands, then it’s time to make some changes.
A potential buyer would review the business’ financial performance over the past three years, and use the information to answer questions such as:
- Is the business profitable?
- Are the owners making a bigger return than they’d get paying someone else to run it?
- Is the business’ cash flow strong?
- Is it being operated efficiently?
- Are the stock levels adequate?
What would the answers be for your business? If you’d answer most of them with “No”, then the business’ risk factor becomes much higher and you’d be less inclined to buy it.
If you wouldn’t buy it because it’s having problems with profit, cash flow, poor growth etc. then you need to fix those problems—now, while you still have time.
Can you fix it?
Having inside knowledge about your business means you shouldn’t have too much trouble identifying any problems, The trick is to avoid getting caught up in the day-to-day activities so you can objectively see what needs fixing or improving.
You should also get advice from an experienced business adviser. Just as a coach can develop a plan to strengthen and improve an athlete’s performance, an adviser can help you develop a plan to strengthen and improve your business’ performance.
Don’t give up on your dream. Get in touch with us today, and let us help you deliver greater profits and achieve financial freedom.
We also offer a Client Advisory Board service – a great resource for every business. You get industry experts in your very own board of advisers, ready to help make your business a success. To learn more about this exciting service, download our Client Advisory Board guide.