Nicolette’s security components manufacturing enterprise has really come into its own this year. Despite the challenges of the COVID-19 lockdowns, she continues to receive a steady flow of orders and her largest client, a UK-based multinational, has confirmed an order that will keep her factory busy for many months to come. So how does Nicolette manage this vital growth and development phase of her business lifecycle?
As your business grows and develops, so do your aims, objectives, priorities and strategies. An awareness of what stage of the business lifecycle you are currently in can be helpful. In the growth stage, your business would now be generating a consistent source of revenue while taking on new customers. Your cash flow has started to improve as recurring income helps to cover your ongoing expenses. Your profits are improving slowly and steadily.
The main challenge for any entrepreneur at this stage is learning how to divide time between the range of new demands now requiring your attention; from managing the increasing levels of revenue and attending to new customers, to dealing with competitors and an expanding team.
Employing or contracting people with complementary skill sets is essential to make the most of your company’s potential during this phase, so spend a lot of time directly involved in the recruitment process. While you’ll still be taking the lead you should be aware of how your team will need to take over a greater deal of the responsibilities that were previously under your control. It is important to start mobilising the team toward clearly defined and communicated roles.
Making the right decisions will require a mixture of instinct and practical business sense, but as your company grows, there should be good business habits instituted in its workflow. One of the crucial business habits is having effective financial planning. Mismanaged finances will put your company’s sales, resources and strategies at risk. You should constantly evaluate your current scenario and forecast your future goals in terms of fixed costs, variable costs and expenses for contingencies. Innovative cloud accounting technologies should be an essential part of determining of your short, medium and long-term goals.
A business with a good financial strategy requires smarter cash flow planning to fuel bigger profits and experience sustainable growth. This involves projections, monitoring and making adjustments. The steps to accelerate cash flow is to check whether your business is making a profit, timely tracking progress of your company, seeking additional financing or loan to expand your business, collecting accounts receivable quickly, controlling cash outflows and take control of inventory management. Also, focus on your marketing tactics together with financial control, with an eye on your cost-per-deal. Cloud-based accounting applications such as Xero and Receipt Bank can easily help you analyse costs per sale.
If you need more information about cloud accounting and payment solutions as part of growing and supporting your business, you can book a call or appointment so that we can talk, obligation free, about your business needs, or send us an e-mail.