Running a business as a sole proprietor, especially in a highly volatile economy, is a momentous task. You started your business because you believed that, at least to some extent, you could make the world a better place and provide a service/product that would benefit others. Unfortunately, running a business is about more than just owning your area of expertise; it’s about knowing how to manage your finances, how to stay within your legal limits, and maintaining a reputation for excellence.
These arenas do not necessarily come easy to many business owners, and so they need to make a decision to either grow their own prolificacy in these areas (at the expense of time and energy put into their speciality) or to utilise alternative resources and services to focus on their speciality.
Here are some ideas to help you make that decision:
Consider the opportunity cost
There’s a saying as old as time, which states that time is money. And really, at the end of the day, it all comes down to opportunity cost. Anything you decide to spend time/money on now means that you won’t have that time/money to spend on something else. This is basic economics, but it is something you should think long and hard about (not too long, though – remember opportunity costs). You need to take stock of where you want to invest your resources to get to the best outcome possible. Sometimes this means spending money to free your time or spending time to free your money.
Outsource the detail
While it would be great to have 36 hours in a day, we only have 24. And this means that you cannot do everything alone. Consider what your strengths are and focus on what you do best and then consider how you can outsource the rest. There are many service providers out there who are more than capable to help you maintain a rein on your finances, business structure, or legal requirements. Some of the basic elements of running a business, such as accounting or contract drafting, are specialist items for which ‘winging it’ cannot be recommended. You want to have the detail in place so that you can do your work to the best of your ability, and often this means outsourcing that detail.
Fine-tune your goals
If your business is younger than 3 years old, chances are that you still have a lot of untapped potential. But success isn’t measured by potential; it is measured by what you manage to achieve day by day. This means you need to set clear, manageable goals in the short-, medium-, and long-term, frequently taking stock of your progress. Ambition is fantastic, but it should not guide your action, as taking on too lofty a target could spell disaster. Therefore, it is advisable to surround yourself with trustworthy friends and advisors to help you determine what your best course of action is.
Perfect the art of saying ‘no’
There will be many opportunities to grow your business as you work it from the ground up. Knowing which opportunities to take a hold of is another ballgame altogether. Enthusiasm and capacity are enemies. For small business owners (especially sole proprietors), growth is also a component of your business to be managed. The worst thing you could do is to over-promise and under-deliver in your dealings with your customers/clients. Be honest with yourself when the next business opportunity comes along and ask yourself, “Do I have the capacity to take this on right now?”. If the answer is no, it may be best to say “No”, then to consider what would be necessary to take on such opportunity in the future and work towards it.
Learn your niche and get specialist advice
Let’s say you’re starting an e-deli delivery service. You’ll need to know which products sell best and which don’t. If you start receiving a lot of orders for fruit, it may be that you’ve discovered your niche. Naturally (no pun intended), you will have to comply with laws regarding the quality of fruit and safe delivery from the farm you are purchasing from – things that you may know nothing about. Having the right lawyer to help you navigate your niche is pivotal in claiming a portion of the market your competitors may not have access to, or do not have the means to grow into.
So, how do you plan to make the most of your limited time and resources? Get in touch with us and see how we can help you achieve your goals and keep you on the right track.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your adviser for specific and detailed advice. Errors and omissions excepted (E&OE)