Jackie is back for the final live session. This month, we have been focusing on financial growth – a subject we don’t talk enough about. This week Lisa Later joined us to discuss managing growth for business owners and how to prepare for the varying stages of growth you may experience in your business.
Tell us about your journey to becoming a business advisor.
Lisa started out as a regional sales manager at Telus and did that for about 9 years until she decided to start her own Telus dealership.
When asked what her biggest lesson would be from all of this, Lisa stated that her biggest lesson was realizing that ‘the story you tell yourself of what you need to do is usually false’. Many people doubt their ability to achieve their goals based on a lack of confidence in themselves. You really must believe in yourself to start and grow your business. Ensure you are telling yourself a positive story as we are masters at identifying what is wrong. Our focus should be on the positives to overcome the challenges you are facing in your business, especially as you begin to experience business growth.
Having the right mindset is important but you also need to focus on your numbers as well.
As you work on growing your business, knowing your numbers will help you prepare for volatility that a growing business will experience. You cannot fully outsource your numbers to your accountant or bookkeeper, you want to be able to drill down and really understand HOW your cash flows!
Tools business owners can use to manage cash flow and business numbers
Lisa has a free course on her website, Lisalarter.com where she gives out some spreadsheets that help with cashflow tracking. She recommends using spreadsheets to track as it helps you filter by customers, profit vs expenses, expenses by vendor, filtering by technology e.t.c this helps you to keep track of your expenses and give you an idea of where you can reduce your expenses and build more profit in your business, by working smarter instead of harder.
What do you think business owners get wrong when managing growth?
Business owners tend to focus on the wrong things as everyone seems to be in a race for the bottom. Pricing is really important, do not get stuck trying to sell your product or service at a lower price because it appears to be an easier sale.
The second thing business owners do that limits their growth is throwing money at problems instead of looking for ways to solve them to prevent reoccurrence. Look at the challenge facing your business before considering using money to solve it. This is especially true when it comes to hiring a new employee when your business is growing instead of considering your business capacity and how you are pricing your product or service. Perhaps you are not charging enough for your product or service to pay for the new hire or you need to look at the efficiency of your processes. A new hire will not solve these issues.
The third thing that limits business owners from growing is that people don’t know how to lead and mange resources as their workforce grows, without an ability to manage and lead solid teams, chances are the growth of that business will be slow or impossible.
What do business owners need to do to prepare for growth?
Forecast: it is important to look at how many new customers you need to reach your goal, what are the resources need to get to where you need to be and try to understand what your capacity is for fulfillment so you can understand what it cost to run your business and when to increase your prices. Business owners need to know the capacity needed to deliver exceptional work and what their circumstances are. Forecasting will help you plan and get where you need to be faster.
What are some of the biggest myths about growing your business
● You have to grow slow: lots of business owners want to grow slow and keep their growth rate around 5% but the truth is you can do way more than that as long as you have the capacity to manage the work and do well
● How much you can charge: many people especially women underestimate their expertise and how much their services are worth. Some other people have limiting beliefs that leads them to thinking they are better off when they lower their prices. As long as you can quantify the value you bring to the table, why not charge high and stick to the numbers because you are more than worth it.
What are some common financial mistakes people make as they start to grow?
One of the biggest financial mistakes will be that business owners tend to underestimate their tax implications. It is important to consult your accountant regularly as you experience growth in your business so that you can plan for taxes in advance. Remember you are in partnership with the government and factor in what you will pay in taxes to avoid any surprises that could derail you financially. Book that appointment with your advisor to talk about the numbers so you are ahead when it comes to dealing with taxes.
Are you experiencing growth in your business? We are happy to help you figure out your finances as you grow. Please reach out to email@example.com. Also, feel free to share your questions/experiences with us here or on our social platforms