SMALL BUSINESS SINS

Anthony Bell has seven tips for SMEs looking to shake off the GFC cobwebs. Advising SMEs, Anthony’s company has won the BRW’s Most Productive Accounting Firm for the past 7 years.

  1. Look to the end at the start (having an exit plan even if you don’t plan to exit) All businesses, big or small, should have a strategy to build the business so it has a multitude of customers and is not completely reliant on the owner. Those who work towards that, rather than just working week to week, generally build great businesses.
  2. Innovate and reinvent. Businesses need to move at the same speed as their customers - what your clients wanted in 2008 may no longer be desired today. Ask the hard questions and don’t be afraid to get constructive criticism. If you only do your business with the same products and the same methods, you can only get the same results – or worse.
  3. Manage cash flows (the key is usually managing your debtors) SMEs need to concentrate on the money coming and going from their business, not just their projected profits. I’ve seen too many businesses show a profit on paper, but the owners can’t draw a salary because debtors don’t pay. That’s why it’s so important to ensure people pay on time – and that you stay on top of those who don’t.
  4. Begin tax planning on the first day of the financial year. Business tax has a complex and documented set of rules; the precedents and rulings are ever-changing, sometimes every couple of months – so don’t wait until June 30 to start thinking about tax minimisation.
  5. Plan for staff change (and if you don’t want to risk getting a rotten apple, grow your own). You should always be building replacements for your key people, because bigger fish have deep pockets to poach your staff.
  6. Ensure your marketing efforts are cost effective and efficient (and don’t underestimate word of mouth). Small business needs to have a cost versus benefit approach to all marketing activity. The best advertising tool for a company is the people who use it.
  7. Celebrate your victories. Small business is hard and can be a difficult slog. Owners must constantly remind and reward themselves for their perseverance and determination in keeping it together.