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Where Is Your Business Going?

When you launch or takeover a business, you will have some idea of what it is you are trying to achieve. Very often your goal will be set in the very near future – for example, “In three months’ time the money I have in the bank will have run out. By then I want to be earning enough to get by, or hopefully a bit more.” Once you’re past the first launch stage then your goals may evolve – “I want to earn more”, “I want to earn the same but spend Fridays at home” or perhaps “I want to have time in the mornings to take my children to school.”

Your goals are important and they need re-evaluating regularly, either because you have achieved them or because they are no longer relevant to where you are with your business. Do you know what your goals are at present? Are they about growing your business? Or maybe they are more about shaping your business to suit your personal goals?

Do You Run Your Business To Suit Yourself?

At first glance you might think this a strange question. After all, one of the benefits of running your own business is that doing so should give you control over your daily commute, your income, your working conditions and much more. But whether you’re a self-employed freelancer working from your home office or a larger operation employing 20 people the logic of your business, and the demands it makes of you, can sometimes take over and you can find that the business is the dog and that you are the tail being wagged.

If this is happening to you then it can be helpful to seek advice and a fresh perspective. At Wise Owl we call this a Business Review. As accountants in practice, we work with a range of small businesses and for each one – at least once a year for all of them (and more often than that for some of them) – we get an accurate and complete financial snapshot of how they have been performing.

Over the years we have developed a comprehensive insight into what makes small businesses work, with the two of us (Andrew and Jay) having had significant business experience of our own, both as part of and outside Wise Owl Accountants. There is not a lot that goes on in a small business that we haven’t experienced ourselves.

Lost Your Way? Here’s What to Look Out For

So how do you know if you’re in that position where your business seems to be slipping out of your control?

To help point the way, here are some questions we frequently get asked – do these resonate with you?

  • If I am making a profit, how come there is no money in the bank?
  • How can I reduce my tax bill?
  • I am working too hard. Can I afford to pay someone else?
  • I want a nice car. What is the best way to acquire one?
  • Why are my costs so high?
  • Do you think my business is doing well?

Making Your Business Work for You

Building a dream or a vision is the belief that you can achieve something incredible. Starting a business, watching it grow, investing in great people – you’re not just solely focusing on the money but something higher than that. You’ll very soon run out of the spark necessary to get you out of bed in the mornings if all you concentrate on is the figures.

But you do need someone to focus on the figures; to analyse them, to review them, to look for ways of adapting and changing the business if necessary so that you can achieve your goals.

You might be looking to fund your house extension, to pay for your children’s education or to travel to far-flung places in the world. We like to understand each of our client’s goals so we know what their individual aim is for that business, and conducting a Business Review just does that. It gives a much clearer idea of the path ahead.

How a Business Review Can Help You

Let’s take the example of one of our clients who runs a successful consultancy with half a dozen employees and an enviable reputation in the market. A few months ago she told us she wanted to prepare for retirement. We sat round the table with her and it soon became clear that, as we suspected, she was far too involved with the business on a day-to-day basis for her to be able to step away from it any time soon. Before planning for her retirement she first of all had to find a way to cut down her hectic six-days-a-week work schedule to something more manageable.

As a result, the conversation focussed on which employees might be able to take on more responsibilities and what sort of abilities would be required of new people being brought into the business. We talked through the financial implications of increasing the headcount and raising existing staff to more senior positions, and also what might be required in terms of staff incentives. We planned the increase in turnover required to cover the increased costs and maintain our client’s income at her desired level. And we looked at whether the business had the financial resources to cover the additional costs and whether the market in which she operated had the reliability and resilience to make the expansion and reconfiguration a safe option to select.

By the end of the meeting we had, together, sketched out how the business might be operating in five years’ time – when our client could look again and decide if retirement was really what she wanted to do.

So whether you’re a consultant, a physiotherapist, an architect or a manufacturer, think about your goals for your business and whether they are the best fit right now for your current situation. If you’re not sure how best to get there, or if you need help redefining your goals for both the immediate and longer term futures, we can help. Find out how by giving us a call on 01235 850 691.

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