Business

Building a business for right reasons

 KIM RENNICK

PEOPLE start and build their own businesses for various reasons – invariably, the reasons are tied up with the owner’s goals, aims and ambitions.

They might range from achievement of a career goal, maintaining their independence, building a great lifestyle, providing opportunities for the family, handing on a legacy for the kids.

These are all great motivators to start a business. The achievement of these goals makes the whole adventure worthwhile.

However, the process can be fraught with diffi culties. There are traps and pitfalls aplenty. Nevertheless, it can be a brave idea to start and build a small business from scratch – ‘courageous’ perhaps.

On Day 1

On Day 1 of the business – this is after the regular salary payments from the previous job have stopped – the new owner can be busy. Very busy.

The owner will need to register the business and organise accounts with ASIC, the ATO, the bank, and perhaps a number professional organisations. He might have to arrange professional or commercial accreditation or certifi cation for the business and secure some funding for the venture.

He may also need to arrange premises for the business – perhaps a shop, an offi ce or a workshop. The premises might need some fi tout – serving counters, display windows, workbenches, tools, repair equipment, vehicle hoists, paint booths and so on. Anyone who has been here will agree the list is virtually endless.

The owner then needs to arrange for sign-writing, business cards, stationery and so on. A website will be required, as will a number of social media accounts.

Of course, all this is happening before the business earns a single dollar of income – or profi t. So, no money coming in the door, plenty going out, along with plenty of energy and time and more than a bit of sweat!

The Crunch

Clearly, to generate income, the business needs sales. At this stage, there is no one else to do that other than the owner. So while the owner is still busy building the business, he also needs to make some sales calls. And bring back some orders.

Being a reasonable salesperson and having some good contacts, in come the orders – enough to keep the lights on for a week or two. That’s great news!

The owner has three main tasks in addition to building the business. First, doing the sales job, then fi lling and dispatching the orders, then the bookkeeping. Then they start the process again. If they thought that they were busy before, life has suddenly become manic.

As things get busier, there is a need to recruit a team! A well-recruited team can help to deliver the orders and do the work. They might even take on the sales role if the owner is willing to take a back seat.

But a team doesn’t appear out of thin air. The owner needs to go full bore into recruitment: designing the roles, advertising the positions, interviewing the candidates, inducting the successful candidates and then directing them in their new roles to ensure the business keeps on working successfully.

All while still building the business, selling, delivering on the orders, managing the cash fl ow. If life was manic before, it’s downright crazy now.

With all this going on, the owner is likely to be caught in the classic crunch, being ground down by demands of customers, the team and the business–having to think of everything and do everything to keep the business going. It’s a situation that few owners can survive for too long. Something is bound to snap.

We have worked with many business owners over many years to help them through just this situation. We at Business Clarity strongly recommend that business owners think about their businesses in a slightly diff erent way.

If all this sounds familiar to you? Scan this QR code which will give you a framework and ideas on how to go about building a business that will help you achieve your cherished goals and ambitions.

Kim Rennick CPE is Co-Founder Business Clarity

How can you grow your family business, while balancing the needs of the business and the family? Share your vision, develop your plan!

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© 2019 KPMG, an Australian partnership. All rights reserved. 282160950ENT. JULY 2021 Edition 123

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