Five Essential Allies Every Small Business Needs: Marketing, Accounting, Human Resources, Legal, and a Banking Relationship

As someone who's navigated the highs and lows of small business ownership and now serves as a small business advisor, I've learned firsthand the value of having the right team in your corner. It's easy to second-guess investments in marketing, question the need for professional accounting services, or overlook the importance of human resources and legal expertise. But trust me when I say, these allies can be the difference between survival and success in the competitive world of entrepreneurship.

Marketing

Small businesses face the constant challenge of making budget decisions, often forced to scrutinize and trim various expenses. Unfortunately, the marketing budget tends to be the low-hanging fruit for cost reduction. While rent, payroll, and vendor payments are essential, slashing the marketing budget risks severing the vital link between your brand and its audience.

As a previous small business owner, I empathize with the challenges of determining the return on investment (ROI) for marketing efforts. It's like throwing darts blindfolded and hoping for a bullseye. Social media, radio, websites—there are so many options, each vying for attention. But it's time to leverage the wealth of data at our fingertips. By tapping into our point-of-sale systems, customer tracking tools, and data analytics, we can make informed decisions that maximize our marketing impact and drive tangible results.

Small businesses must recognize that marketing is not just an expense, but an investment in your future success. Neglecting to keep your brand visible means risking fading into obscurity in the minds of customers with short attention spans. Rather than completely cutting marketing from your budget, it's crucial to adapt and reallocate resources wisely. After all, acquiring customers is hard work, and retaining them is equally important. By staying top of mind through consistent marketing efforts, you can fend off competitors who are eager to swoop in and steal your hard-earned clientele.

Unless you're well-versed and proficient in marketing, it's prudent to entrust this responsibility to seasoned professionals. Throughout my own journey as a business owner, I've collaborated with and connected with numerous marketing experts and agency owners. Fortunately, there are plenty of firms that specialize in catering to the unique needs of small businesses like yours. My recommendation? Invest time in thorough research. Interview at least three firms, solicit quotes, and most importantly, cultivate relationships. Choose a partner who not only aligns with your growth objectives and budget but also boasts relevant industry experience. Ultimately, aim to establish a partnership built on trust and mutual understanding.

?Accounting

During a recent encounter with a small business, I inquired about their accounting practices. Their response? "Uncle Bob handles our books." This retired bookkeeper seemed like a convenient and cost-effective choice at first glance. However, upon digging deeper, it became evident that their approach was fraught with pitfalls. They were commingling personal and business taxes, neglecting essential financial strategies like depreciation schedules, and ultimately facing substantial tax liabilities come year-end.

Having a dedicated bookkeeper for your business is undoubtedly valuable. However, it doesn't negate the need for a skilled accountant. A Certified Public Accountant (CPA) brings a wealth of expertise beyond tax preparation. Their focus extends to forecasting, strategic planning, and cash flow management. They can also provide invaluable assistance with payroll, sales tax, and even reviewing your business structure to ensure its optimized for your size and needs. Larger accounting firms may offer additional services like payroll and even human resources support. By enlisting the expertise of a CPA, you can delegate financial concerns and focus on what you do best—whether it's selling your products, services, or showcasing your exceptional skills.

Human Resources

The absence of Human Resources (HR) in your organization poses numerous risks, some more evident than others. At the forefront are the potential for lawsuits stemming from issues like wrongful termination or discrimination. Additionally, navigating legal compliance requirements such as I-9 laws and other regulations becomes significantly more challenging without HR expertise. Employee management tasks, including hiring, firing, and performance evaluations, also become more complex and prone to errors. Moreover, without established HR policies, you risk inconsistency and ambiguity in how workplace matters are handled, leading to confusion and potential conflicts among employees.

The debate over when to hire a Human Resources specialist is a longstanding one, and I won't delve into it here. However, it's worth noting that during the recession of 2008-2010, many organizations turned to controllers and office managers to handle HR responsibilities, with mixed results. While this approach may have provided temporary relief, it often led to inefficiencies and compliance issues.

Fortunately, this period also gave rise to specialized HR firms equipped to handle a range of tasks, from timekeeping and recordkeeping to onboarding, offboarding, payroll, and policy creation. These firms offer flexible pricing models, including hourly rates, monthly memberships, and flat fees tailored to your needs.

Before selecting an HR partner, it's crucial to conduct thorough research, seek referrals, and interview multiple firms to find the best fit for your business. By doing your homework, you can ensure you're entrusting your HR needs to a reputable and reliable partner.

Human Resources is indispensable for safeguarding both your business and your employees. Without HR, you're vulnerable to a myriad of risks that could jeopardize your operations and reputation. Whether it's ensuring legal compliance, resolving employee disputes, or implementing fair and consistent policies, HR plays a crucial role in mitigating risks and fostering a positive workplace environment.

As a small business owner, there may come a time when you find yourself in urgent need of HR expertise. From navigating complex employment laws to handling sensitive personnel matters, having a professional on hand can provide invaluable support during times of crisis.

Attorney

In my experience as a small business coach, guiding entrepreneurs through the startup and growth phases, I consistently advocate for the involvement of an attorney in shaping the structure of their business. Questions about incorporating family members, taking on partners, or securing private investors are complex and can have far-reaching legal implications. It's essential to seek guidance from a business attorney who can provide tailored advice and ensure that your business structure aligns with your goals and protects your interests.

Signing a lease agreement is often a pivotal moment for small businesses, but it can also be fraught with complexities. Landlords naturally prioritize their own interests, and navigating lease terms can be daunting without expert guidance. Attorneys specializing in real estate law understand the nuances of lease agreements, from deciphering terms like "triple net lease" to clarifying responsibilities for common areas and maintenance issues. They can ensure that rent increases are calculated fairly and that you fully understand your obligations, such as maintaining HVAC systems or leasing a "vanilla box" space. With their expertise, you can enter into lease agreements with confidence, knowing that your business interests are protected.

In the unfortunate event of a lawsuit, it's crucial to understand the extent of your liability and the coverage provided by your insurance policies. Whether the incident occurred inside your leased space, in the parking lot, or elsewhere on the premises, your attorney can advise you on your legal obligations and potential liabilities. Additionally, they can review your insurance policies to determine if damages resulting from the lawsuit are covered and to what extent. Having a clear understanding of your insurance coverage and legal options can help you navigate the complexities of litigation and protect your business interests.

?Banker

Your banker is indeed a valuable ally, especially during times of economic uncertainty like the COVID-19 pandemic. As witnessed during the PPP loan program, businesses with established bank relationships and strong financial practices were prioritized for funding. Those who had cultivated strong ties with their banking partners and maintained robust accounting practices were able to access funds more efficiently. Conversely, small businesses without existing relationships or those banking with national institutions often found themselves at a disadvantage, relegated to lengthy queues or call centers for assistance. Building and nurturing a relationship with your banker can prove instrumental in accessing vital financial resources and weathering challenging times.

I frequently encounter panicked business owners facing cash flow challenges and in need of a line of credit. Many of them lack strong relationships with their bankers, which can exacerbate their predicament. I always stress the importance of building these relationships early in the business journey. Bankers are more receptive to forging connections when you're not in crisis mode. By nurturing these relationships over time, bankers become familiar with your business's growth trajectory, pain points, and cash flow issues. This familiarity makes them more inclined to offer assistance when you need it most. So, investing time in cultivating relationships with your bankers early on can prove invaluable in securing financial support down the line.

It's important to understand that bankers can be cautious when it comes to startups. This isn't a reflection of you or your business—it's simply a risk management strategy on their part. However, rather than taking it personally, I encourage you to seek advice from bankers and understand how they can support your business goals. If you find that a particular banker isn't as engaged or interested in helping you, don't hesitate to explore other options. There are plenty of banks out there, and finding one willing to be your dedicated business relationship banker can make a world of difference in your entrepreneurial journey. Keep exploring until you find the right fit for your business needs and ambitions.

Allies Are Important

In conclusion, I often hear from small businesses that they feel they can't afford the professional support of experts like accountants, HR specialists, and attorneys. However, as both a small business advisor and former business owner, I firmly believe that in most cases, you can't afford not to have these essential allies. While it may seem daunting to allocate resources to professional services, the long-term benefits far outweigh the initial costs. These experts can provide invaluable guidance, protection, and strategic insights that ultimately contribute to the success and sustainability of your business. So, consider them not just expenses but as investments in the future growth and prosperity of your enterprise.