Using Professionals to Help You Start and Grow Your Business
When people are starting out in business the common thing we find is that they are trying to minimise all costs including the cost of professionals.
While this can initially reduce startup costs, it can lead to the business taking longer to become profitable, and lead to costly mistakes.
Professionals are experts in their fields and while it costs money to engage them, their advice and guidance will set you on the right path to business success and help you to avoid costly errors.
When considering starting a business we recommend that you use professionals to assist you with:
- Creating a business plan to review the viability of your business. It is better to spend $5-10,000 and discover that your proposed business is unprofitable rather than to invest and lose $50,000 or more.
- Assist with gaining financing for your proposal including preparing cash flow forecasts. Often we find that when people prepare their own cash flow forecasts, they miss many costs. Use of an accountant can help you avoid this problem and your accountant will assist you with liaising with bank mangers.
- Setting up an accounting system that will provide you with timely reports on your profitability, cash flow and expenses that will cope with expansion with your business. If the costs are not too high, you should consider an accounting system that will integrate with your other business systems. The accounting system required will depend on the nature of the business. An accountant will be able to advise which system would most suit your business.
- Setting up the right legal business structure. Often after a business has been operating for several years we are called in to change the legal structure of the business to allow for family succession planning or allowing a new investor into the business. This can often have significant tax consequences that could have been avoided if more care was taken when the business was initially set up.
- Reviewing legal documents before you sign them. The legal documents may include business/property purchase agreements, supply contracts, lease agreements and terms of trade. Lawyers will take you through legal documents to ensure that you understand them. Your lawyer will also point out any problems with the agreements so that they can be amended before you sign them.
- Creating employment contracts for employees and setting up appropriate company policies. We would also recommend that someone going into business seek some training in employment contracts and general employment requirements. Making a mistake in relation to employment can be very expensive. You should not rush into employing staff before you have performed reference checks.
- A marketing program to assist you in building your sales volume as quickly as possible.
In addition to the use of professionals, we also recommend that you have someone who can mentor you in your business. Ideally this would be someone who has many years’ experience in your industry and who was successful in running their own business.