Here’s the thing. I’ve been around the block a bit. I’ve owned three trades businesses, sold one for a sizeable profit, and now I own a job management software company working to streamline work processes for trade businesses. I’ve learnt a bit in my time and it is not always what I expected.
Growing your business is not always a no-brainer. While growth can happen organically, a plan is essential to make sure that growth is sustainable and good for you and your company.
Done well, a growing, working trade business can become an incredible money-making machine that requires little input from you.
Done poorly, a growing business will cost you more time and money than a small business, leaving you exhausted and broke.
I know. I’ve experienced both of these situations. And there are definitely some questions you should ask before you commit yourself to growth. Anyone can have a growing trades business, but it’s definitely not for everyone.
So You’ve got a Great Small Business – Now What?
Questions to ask yourself before you grow
1. Do you want to grow?
Growth can actually be really uncomfortable. It is going to bring a whole lot of change to your business and to your role. You need to know if you are up for that.
Are you happy for things to change? Or do you really love the status quo but just want a bit more in your back wallet?
Figure out what you want, whether you are willing to do what it takes and, if the trade-off is not big enough for you, then figure out another way to get what you want.
2. Are you happy to stop being a tradie and become a businessman?
Unfortunately, this is one of the realities of growth. As a sole trader, through to managing up to five employees, you can still predominately wear your tradie hat. However, as your business grows you will need to personally grow.
This means less time on the tools and more time managing and leading your business.
If that thought makes your skin crawl, then you probably don’t want to commit to growing your business. That said, feel the fear and do it anyway!
3. Are you happy to switch from having tradespeople work with you to having tradespeople work for you?
Ah this one is a clincher. It actually took me a while to get used to this in business and I really mourned for the day when I was out on the tools and only had 3-4 guys, when we were a real team.
When you expand to take on office staff and then you move off the tools, it often becomes a case of ‘Us’ against ‘Them’. You are no longer part of ‘Us’. It doesn’t happen overnight and there are things you can do to lessen this but the reality is, there will be a change.
4. Can your current systems support growth? If not, do you have a plan to change them?
The truth is you can run a small business reasonably well without a robust system, but when you start to grow the wheels will fall off it pretty quickly. You may actually think that you have got a great system in place – but growing from five to 15 vans will really put this to the test.
I’ve too often seen growing businesses throwing more and more admin people at broke systems, hoping that people power will fix it. It might, but you’ll lose profit and end up wondering why you are bringing in more money and taking less home.
It’s worthwhile stopping and taking ruthless stock of your business.
How much does your current system depend on you?
As you scale, will you have to exponentially scale the manpower?
Do you have a lot of little holes where you could lose money if you were not personally sitting really tightly across these?
If you answered ‘Yes’ to any of these questions, make a plan to fix them now. You will regret it later and it may cost you your business or your health.
5. Are you ready to become an apprentice again?
Just as you would not become a tradesman without doing an apprenticeship, you really should not be running a business until you’ve done a ‘business-ship’. The great thing is you can do this ‘business-ship’ on the job.
It does require an attitude change though. You have to be prepared to become a student again, you have to be up for making mistakes and learning from them.
Don’t expect to run your growing business successfully from day one, commit yourself to learning everything you can from anyone you can, and you’ll eventually get there. Just don’t give up the first time you mess up.