WHY YOUR BUSINESS IS STATIC?!

Have you ever spared a moment to think about why your business isn't growing??

One thing every successful company has is a well-defined business and financial objective that is reviewed periodically.?

For your business to be successful, it is expected to follow the footstep of other successful businesses in the same industry; by treating it as an entity different from its owner and efficiently managing the business resources in an accountable manner.?

Having worked with quite a number of small businesses, I got to realize several business owners have no structure in place to sustain the business. An efficient structure enables you to save time and allows you to monitor the different facets of your business. To facilitate growth, a business that is concerned about growth needs systems in place to:

• Track weekly, monthly, and yearly revenue and expenses?
• Compare set goals with actual performance periodically
• Monitor customer satisfaction level
• Develop marketing budget and track its performance
• Track customers retention rates, among other

In addition to the overall business goal,? It is paramount for you to outline also your financial objective which will serve as a benchmark for accessing your business performance over time.?

Running your business solely for profit-making is not a sustainable objective and is too little of a motivating factor. Your business's financial objective could be in form of increasing revenue which can be achieved through increased marketing or an increase in the sales price; it could be to increase profit margin by reducing operating expenses and costs cutting or to promote financial stability by effectively managing debtors, paying off debt and keeping income level consistent among many others; the essence of which serves as an excellent benchmark to gauge your business success in an objective way.?

This set financial objective can then be further broken down into monthly targets; for instance, a financial target such as generating #1m in sales can be achieved by working towards making sales worth #84k each month. To grow profit by 20% in the current period is another metric for business growth. Thereafter, it is required to periodically review this target in order to compare it with actual results and then put in the appropriate measures towards attaining the set goal.

You ought to realize that establishing this financial objective is an essential component of building a new business or making substantial changes to an existing one. These goals are something to work towards, as they will influence how you run your business and what decisions to take. It is an important component of your business strategic plan which is necessary to serve as a roadmap of where your business is and where the business wants to be.?

A critical factor to achieving the above is by having a proper record-keeping structure for your business.?

Lack of record keeping is one factor SMEs have in common, making it impracticable to assess the business health over time and dampening the business growth. This is why the importance of keeping records can never be over-emphasized.?

As a business owner, it is essential for you to know your numbers - to track sales inflow, keep a tab on operating expenses, efficiently manage debtors to avoid bad debt, handle creditors with care to avoid a bad reputation, and efficiently invest in non-current assets in a way that maximizes return. A financial record (data) is an important base for making strategic investment decisions; I guess now you are no longer surprised as to why your business is static!

It is simply difficult to establish your company's financial state or profitability without excellent records. As a small company owner, you should be aware of and understand the significance of appropriate record keeping as well as cash flow planning if upscaling your business is your ultimate goal; while keeping in mind that to successfully achieve this, it is important to first separate your business from you.?

Beyond all of this, you ought to understand by now that it takes money to make money; However, many small businesses spend little to nothing when it comes to marketing and not realizing that the growth of your business is directly related to how much you invest in this area; alongside increasing inventory, investment in technology, more employees and other assets for the business.?

To conclude, another factor affecting the business growth is lack of delegation and being understaffed. In the long run, it is impossible to successfully run a business alone; without enough staff support, the business will remain stuck. By doing the work yourself, you’re failing to make the best use of your time which prevents you from focusing on other core areas of the business.?

However, by meaningfully involving other people, you get to develop your employees’ skills and abilities while successfully executing your role as a manager.?

But this wouldn't be complete without offering practical ways to upscale your business. This you would come to learn in the subsequent article.