Category: entrepreneurship

Best Marketing Ideas for Small Business Owners in 2022

Building a business takes so much from us as entrepreneurs. Our attention is often drawn to many different things at once. But one thing you should never lose focus on is your marketing strategy. Businesses, both large and small, often live or die on the success of their marketing initiatives.

Great marketing certainly takes more investment, both in money and in time. But it is an aspect of your business that holds the potential to entirely change the course of your company. Let’s look at a few of the best marketing ideas for small business owners in 2022.

Establish Identity: Create Your Brand and Tell the Right Story

It may sound obvious, but a lot of companies don’t take the time they need to carve out a wholly unique brand story and identity. Especially now, with the prevalence of online commerce, social media, and international connections, establishing a clear and confident picture of your brand is a strong way to connect with people looking to link with companies, products, and creators that mesh with their values or support their needs.

Story is important. More and more people aren’t satisfied with good products on their own. They want to understand how and why you’re different from every other choice, and feel a connection to your goals and your brand’s attributes.

Work with great marketing specialists, brand developers, content marketing strategists, and trusted partners to create meaningful brands that not only exceed others in quality, but outdo them with better story and stronger identity.

Focus: Niche is Good

This may seem like a no-brainer to some of you and completely unnecessary to others. You may be tempted to try and be everything to everyone, to solve all problems and provide all solutions in your field. This usually doesn’t pan out well. Instead, focus. Decide who your target audience is, why they need you and why your solution is superior.

Of the handful of things you feel good about doing, narrow your focus to the ones, or just one, that rises above all the others, the one your company excels at the most. Instead of spreading your resources and your marketing strategy across too many offerings, pour it all into one or two products or services in which you have the potential to affect great influence in your chosen field.

Start a Referral or Rewards Program

This kind of promotion will certainly look different for every business owner. But providing your clients or customers with the ability to gain a great level of value from their purchases will go a long way to ensuring they come back and talk about you with friends and colleagues.

Work with your marketer to create special offers for existing and potential customers, discount clubs, or ongoing memberships that give them solid savings, members-only products, and access to information or events only available to those who sign up.

For clients, offer perks for referring others to you. It could be a discount on present services or one on a future purchase. It might be a bump up to a higher level service, or something only your business can offer. Special programs like this can give your customers a sense of belonging and exclusivity and inspire them to keep coming back around.

Don’t Ignore Social

Whether we enjoy social media channels or not, it’s definitely here to stay. And its influence on brands and companies is growing month after month. Superb video ads, humorous and informative YouTube, Facebook, TikTok, and Instagram videos and posts can really connect.

Authentic reviews from happy customers and letting your guard down with intimate behind the scenes looks at production, company values, personal story, and the creative process can really inspire and draw in new followers. Continually relevant content helps build dedicated communities, not just customers.

Automate

Some things aren’t good for automation. Some are. Certain aspects of marketing can be automated to help you be more effective with less effort. Marketing specialists have incredible access to a wide range of technologies today.

These applications allow creators to write and develop marketing materials, response letters, requests for reviews and feedback, sign-up forms, blog posts, regular emails, newsletters, and social media posts, then input, schedule, and let the program do the rest of the work of posting, emailing, and gathering customer info. This also helps you get to know your audience, build an email list, and learn both better ways to market and solve customer needs.

Create Explainer Videos

Most folks love these, especially if they’re both entertaining and informative. Create high quality, straightforward videos that explain how to use your products and services so users know exactly what they’re doing and gain confidence in your service. It’s also a great chance to build rapport with your audience and keep them thinking about your brand.

Offer Live Chat

If you can afford it, live chat can be a game-changer for your customer’s experience. No matter how much info or FAQ’s you offer, most of us prefer or need to speak with a real person. Live chat gives customers and clients a direct connection to a qualified professional who can answer all their questions, help them sign up or make purchases, and solve any issues that may arise.

Knowing that they can reach a real, attentive person will help to establish you as the better brand and problem-solver in the minds of your customers. No matter how much technology we adopt, nothing will ever replace the comfort and confidence gained by knowing we have direct access to a caring professional.

Use Analytics

Nearly all social media platforms, online advertising providers and browsers, along with a variety of other tech creators, offer a range of analytical solutions for your marketing efforts, for understanding consumer habits, and current trends driving business today.

Take time to familiarize yourself with these tools and hire or contract a professional who understands analytics inside and out. The information within detailed analytical reports allows you to make better decisions for your brand and your finances. You’ll gain the knowledge you need to remain agile, to shift your focus when needed, innovate and create new and better products, reorient your brand message, spot problems early on, solve them more quickly, and connect more effectively with your audience.

Hire a Professional

Whether you establish a dedicated marketing department in-house or outsource your efforts to an experienced marketing experts, there is absolutely no substitute for years of experience, market knowledge, and good education.

Professional marketing strategists, content creators, brand developers, and other advertising and marketing specialists pour the full weight of their skills and knowledge into your brand and message. This also allows you to focus on things where you’re often more gifted, like leading your team, managing production, connecting with customers, and refining customer experience.

Conclusion

While this is only a small sampling of marketing tips for the year ahead, it’s a great place to start, especially if you aren’t already expanding your marketing efforts. Marketing is never something you want to ignore. It establishes your brand’s identity and story, helps you connect meaningfully with customers, brings greater attention from possible partners and collaborators, and ups your image within the market. We’ll look at even more marketing tips soon.

Sound Accounts helps business owners solve all their bookkeeping needs. We offer a range of services that turn your bookkeeping from a burden into an asset. Contact us today to get started.

For quick answers to marketing questions, take a look at our frequently asked questions below.

FAQ

Why is marketing important for my business?

Developing a strong marketing strategy ensures you establish a solid position within your field. It creates strong brands with compelling stories, draws in new customers and helps retain existing ones, helps you build strategic partnerships and create the legacy you want.

What are some basics of marketing everyone should remember?

There are many. But it’s good to start by focusing on a niche, your strongest creations, use social media and video, find ways to connect with your audience, offer top-notch customer service, offer additional perks with memberships and referrals, use analytics and partner with experienced marketing professionals.

Should I handle marketing on my own?

Some business owners can, especially if they have a strong marketing background. But for most of us, even those who do understand it well, it can often take up a great deal of our time and efforts, which takes us away from other management and leadership tasks. Linking up with experienced marketers gives you access to years of experience, a deep well of creativity, brand new technology, better automation, great advice and guidance, and someone always ready to innovate and try new solutions.

February 16, 2022
Should I Hire an Accountant or Do My Own Books?

Many business owners are choosing to hire an accountant instead of doing their own books. This can be for several reasons. But should you hire someone or handle it on your own? The answer often depends on what kind of business you’re in and how much work you’re willing to put into it. Factors like the size of your business, the number of employees, and the complexity of internal logistics might all affect your decision to either take on bookkeeping yourself or hire it out to a professional. Let’s look more closely at the pros and cons of each one and equip you with the information you need to make the right choice.

Should you hire an accountant or do your own books?

This decision is unique to each individual and involves several factors. How big is your business? How many employees do you have? Are you already finding it difficult to keep track of your books or does it come naturally? Are you comfortable with accounting software or do you feel that a real set of trained eyes would help you make better financial decisions? Is spending time on accounting worth it to you, if you even have the time? Or would you rather use that time to focus on other parts of your business?

Why people hire accountants

The main reason companies hire accountants is because they want to avoid doing their own books. Some business owners are too busy with other tasks like marketing, sales, and operations to do their own bookkeeping, so they hire someone else to take care of it for them—promoting efficiency and accuracy in the process.

Another reason many owners hire an accountant is that the accountant will make sure that your books are up-to-date and account for all the financial aspects of your business. They’ll help reduce errors by working closely with you throughout the bookkeeping process—helping you develop a better understanding of your company’s finances and accounting systems. Accountants keep your taxes clean and up to date, spot opportunities for better resource management, and free you up to focus on expansion, customer satisfaction, and product development.

If you’re a business with a growing number of employees, or you’re managing a lot of resources, hiring an accountant can help you keep your finances organized. Still, there is sometimes a fine line here. If you have less than 10 employees, there may not be much work for your accountant to do. However, even if you are a smaller company, you may not enjoy handling your own books, feel overwhelmed, or simply want to focus that energy on something else. In this case, why not hire a professional if you can afford it?

Pros and cons of hiring an accountant

Partnering with an accountant is often a great option for many businesses. They will handle all the books for your company, uncover problems early on, and help you pursue new opportunities. Their expertise includes taxes, regulatory reporting, financial statements, internal ledgers, and more. Bookkeeping programs help you with some of this, but having a fully engaged individual to watch over these key financial areas can often make the difference between consistent success and just getting by.

Another benefit of hiring an expert is that they’ll likely have a broader scope of knowledge to explore. Accountants have years of experience dealing with a multitude of businesses. They understand the hidden rules of taxes, know how to pick out seemingly insignificant details buried within financial reports, and help you put together a more focused plan for the weeks and months to come.

The primary drawback is that hiring someone requires a financial investment. Professional services like those offered by CPAs are worth it, but can sometimes be more than small business owners can afford early on.

Why some people choose to do their own books

Doing your own books is a great way to save money. It’s also a wonderful opportunity to learn a new skill, gain a better understanding of your business and get used to using accounting programs. If your business consists only of you or perhaps a couple of employees, learning how to maintain your books can be a significant step toward taking more control over your success.

Some people just like having the control within their own hands. Certain business owners simply prefer to manage most of what they do, including their bookkeeping. This is fine as long as you do your research, get the right tools, keep up with it daily, study your reports, keep detailed records, and ensure you are complying thoroughly with all tax laws and business fees.

Why sole proprietors often do their own books

Many sole proprietors agree that it’s worth it to do their own books and deal with the hassle simply because they have the time and want the control.

If they are diligent, sole proprietors can keep track of every dollar they make and spend and know exactly what’s going on in their business. When your business model is relatively straight-forward, and doesn’t involve complicated financial management, multiple overlapping departments, or employee payroll and benefits, doing the books yourself makes sense. Plus, this will allow you to see how much time it takes to handle your own books. This will help you better determine whether continuing on this path or pursuing professional accounting help is the best choice going forward.

Some difficulties with handling your own books

Mistakes: If your bookkeeping isn’t handled correctly, it could cause a financial blow to your business.

Time and Confusion: It could be more of a hassle than you originally thought, eating up time you could be using on other tasks. You may also not enjoy it enough to take it seriously and begin to miss key details within your reports.

Tax Penalties: You could miss paying taxes on time or do so incorrectly.

Energy and Focus: With everything on your plate, you may not have the energy left to spot mistakes or glean vital information from financial reports to make more strategic decisions about the growth of your business.

If you are going to manage your own accounting, make sure you have the right tools in place. Subscribe to a quality program like QuickBooks Online or Xero, or one of several others. Learn all its features and study your reports daily. Even if you;re doing it yourself, if problems arise or things get too confusing, reach out for professional help.

Conclusion

There are pros and cons to each choice. Learning how to do your own books is an important skill to master. It helps you be a more engaged and focused business owner, with an eye on the details and a better handle on what goes on behind the scenes and beneath the surface.

Hiring an accountant, whether they be in-house or outsourced, can free you up to focus on other things. They can spot errors early on, help you understand trends and patterns that either affect you negatively, or open doors toward growth, help you pay your taxes, keep you accountable to your own budget, and give you peace of mind knowing you have a partner who is looking out for you and your business.

Sound Accounts helps business owners manage their books with confidence and ease. We offer a range of accounting services to meet the varying needs of any business, letting you relax, breathe deep, and focus your attention on everything else.

For answers to accounting questions, see our frequently asked questions below.

FAQ

Why is doing the books important for me as a business owner?

Keeping up with your accounting each day is the only way for you to be successful in the long run. You’ll see where your resources are going, where you’re realizing the most profit, and which areas are leaking money. You’ll spot trends and have a clear view of where to go next. Not to mention paying your taxes correctly and on time.

Should I hire a professional or do my own books

This decision is different for each business owner. It depends on the size and complexity of your business, the number of employees you have, how comfortable you are with accounting software and spreadsheets, whether you have or can make the time each day to update financial data and study your reports, and other reasons. If you understand the importance of keeping up with your books, can navigate the software, have few employees, and are fully committed, you can manage your own books.

However, if you have a more complex business model, more employees, several accounts or departments, each with their own resources and expenditures, deal with a lot of vendors or partners, or simply don’t have the time, energy or patience to do your books, hiring a bookkeeper or accountant is the right choice. They will take the stress and worry off your plate, handle all accounting matters, spot troubled areas and trends and help you make more informed and strategic financial decisions.

As a sole proprietor, should I hire an accountant?

It isn’t always necessary to hire someone. You may well be able to handle your own bookkeeping if you have the time and desire to learn how to do it well. If your business is relatively straight-forward and you want to oversee your accounting, you can use quality software to help you manage it effectively. However, even if you are a sole proprietor, professional accounting services can often be a great choice for you. If it is an expenditure that you can afford and it saves you time and helps you stay current and make better choices, it may be worth outsourcing part-time for monthly help keeping your books.

What accounting program should I use?

QuickBooks Online is often the right choice for any business. With robust options, a range of features, well-organized reports, and solid customer support, they’ve been doing this for years and continue to improve. Other great options include Xero, Freshbooks, Netsuite, Sage and countless others. Each carries different features and varying levels of support. It is important to do your research first, and find the program that you’re comfortable with and provides everything you need.

December 29, 2021
How can I expand my business without taking out a loan?

Creating a new business is an incredible undertaking in its own right. But expanding on your success involves new ways of thinking, new approaches to funding, partnerships, and innovation.

The most obvious way to begin your expansion with the resources you need is to take out a loan. While this is a great solution for those who can do so at affordable interest rates, there remains a handful of possible downsides to taking on more debt. Thankfully, when asking “How can I expand my business without taking out a loan?” you have plenty of solutions that don’t include additional loans, with countless opportunities for freelancers and entrepreneurs alike. We’ll take a look at a few of these in this article.

Understanding the pros and cons of borrowing money

The decision to borrow money to grow your company is a big one. While borrowing money can be beneficial, there are also risks involved. The most obvious upside of borrowing money is that you’ll be able to access the resources, staff and technology you need most to expand your current vision. If you have a good credit history, securing loans with more reasonable rates may be possible. Loans allow you to expand without taking on equity partners, dividing your profits, or worrying about paying friends or relatives back, something that can often negatively impact relationships. Still, there are also many cons to borrowing money for your business.

– You will likely have to pay high interest rates on the loan

– You may not be able to repay the loan by the deadline

– Your business may fail and you’ll need a new job while still having to pay back the loan

-Defaulting on your loan or having too many late payments will damage your credit, making it more difficult to access the credit you need in the future.

Find low cost or no-cost ways to expand your business

Taking out a loan is usually the most straightforward way to expand your company. However, there are several low cost and even no-cost ways to grow your business. When we’re in the thick of things trying to keep our business going strong, it’s easy to get tunnel vision and think that we don’t have many options. But this just isn’t so. A more creative and less-costly approach may be exactly what you and your business need.

If you’re looking for more creative solutions, consider applying for grants, crowdfunding, franchising, partnering with other companies or taking on an equity partner. These methods can help you grow and increase your brand’s footprint without taking out a loan.

Explore your options for grants

There’s no shortage of grants available to support small businesses. For example, the Small Business Administration offers a variety of grants for entrepreneurs. The SBA is a good resource for grants and can be found on their website:

https://www.sba.gov/content/for-entrepreneurs-and-small-businesses

We recommend checking out their programs and determining which grant fits your needs best.

Additionally, individual states, counties and cities offer unique programs for small businesses, many of them featuring grants for a range of business types. That’s money you don’t have to pay back. While some grants may not be as large as the loan you wanted, these funds can take a large bite out of your need, get the ball rolling on the initial steps of expansion, and allow you more freedom with less financial strain. Check out the primary business resource websites for your city and state for more information on grants.

Explore your options for crowdfunding

Another superb option for financing your business is crowdfunding. It’s an effective way to raise money without having to take out a traditional loan from a bank. You can crowdfund for general business expansion. However, crowdfunding works best when applied to a specific project, product, or tangible growth strategy. Think about what specific projects or product and service launches you would like to accomplish and create a crowdfunding campaign for these. Here are some tips for using crowdfunding:

Think about what kind of project you want to launch — it could be anything from a new product or service to an invention, or a new and creative way of doing something you’ve done for a while. Be precise.

Keep your breakdown and pitch short, sweet, and simple. This can make things easier when you’re trying to raise money, as it’s less intimidating for people who are unfamiliar with the topic. Trust in your audience’s intelligence and desire to help. But don’t tax their patience with unnecessarily long explanations and complicated charts. Spend some time thinking about the core of your project. Distill it to its essence, map it out in simple, bold terms, and present it with confidence and ease.

Make sure you have a clear goal in mind before going live on Kickstarter or Indiegogo. Know the dollar amount you need to achieve your goals. Be realistic but be careful not to be too conservative with your estimate, simply hoping to not scare people away. If you present your ideas well and justify clearly why you need the amount you are asking for, people will respond.

Use social media platforms like Facebook and Twitter to help spread the word about your campaign and how much has been raised so far. The more people you get talking, the more people will want to partner with you on your journey and benefit from your expansion when it happens.

Communicate often! If people don’t know what they’re getting in return, they might not donate money. And if they do donate, they might not give enough because they’re not being updated regularly. Keep them in the know. Make sure your donors feel like partners in a creative or meaningful endeavor, not like strangers throwing money to other strangers. Communication and excitement are key.

Explore your options for partnerships

If your business is just starting out, there are a number of ways to partner with other companies. For example, you can partner with a company that helps support your audience, markets to a similar customer, or offers products and services that complement many of the things you do without being in direct competition.

Partnering with another company can provide a wide range of benefits, such as exposure for the other company’s products and services and the opportunity for cross-promotion. You should also consider how much control you will have over the partnership if it goes well.

If you’re looking to expand without taking on debt, partnerships are a great way to help grow your business with no startup costs.

Franchising can be a great way to grow a business

One of the best ways to grow your business is to franchise it. Franchising allows you to expand your company into a larger market while keeping control of your brand and not having to take on additional debt.

There are different types of franchisors: Direct franchisors offer complete support for the franchises, which includes training, marketing, resource vendor partnerships, and more. These types of agreements usually allow the franchisee to operate a single storefront or location with the possibility of purchasing additional locations in the future.

Other types of arrangements, like area development or master franchising, offer franchisees the ability to develop a presence in a larger geographical area, essentially giving them business and expansion rights within a region.

In many cases, expanding your business through franchising, if your business model allows, is a less expensive option than partnering with an outside company or taking on additional loans. Oftentimes, offering franchises allows you to widen your influence and the impact of your organization and brand without leveraging yourself too heavily.

Exploring Equity Partnerships

One more road you can take when thinking about expansion is securing equity partnerships. In simple terms, these are like the agreements reached by two parties on the show “The Shark Tank,” where a company offers a future percentage of profit or revenue in exchange for up front cash investments into their business.

This allows you to skip high interest rates and additional credit debt. However, remember that you will probably have a partner for life unless the contract is written otherwise. This means that your new partner will often have a partial say in how and what you do in your business and will continue to collect their profit points as the years roll on. This means less debt and a cash injection for you, but less autonomy and a loss of profits.

Conclusion

You can’t always borrow money to expand your business. Other methods can help you grow and avoid taking out a loan. Find low-cost or no-cost ways to increase your revenue by exploring your options for grants and crowdfunding. Consider different types of partnerships and see if franchising might work as a business growth strategy.

Business expansion is exciting. It can mean greater impact within your market and in society as a whole. It can also translate to a growing income for you, your family and your employees and partners. Still, it is important to do your research, know your finances inside and out, compare your options for funding and use those that offer you the greatest benefit while maintaining a reasonable level of risk. It’s time to get growing. And there are more ways to do so than most business owners might think.

Sound Accounts offers dedicated accounting services to new and growing businesses, helping business owners like you achieve the expansion they desire by helping them manage their budgets successfully.

December 15, 2021
5 Business Budgeting Questions Every Small Business Owner Should Ask
As a small business owner, one of the most important things you can do is ensure that you have a good budget for your company. Many people start businesses because they have a dream of what their service or product can give to the world. But in order to provide these services, you have to ensure the financial health of your business. This requires attention to your business budgeting.

How much money do you need to run your business successfully? How much money does your business require to survive? What does a good budgeting process look like? How do you determine a budget period? A successful business requires a well-planned budget. If you don’t have a budget, then you won’t know if you are spending too much or too little. A well-planned budget should also keep both short-term expenses and long-term goals in mind.

Here are the top budgeting questions that every small business should have:

1. Do you have a budget for your small business?

This might seem like a silly question, but it really is the most important one to start with. If you don’t have a budget and aren’t keeping track of what is coming in and going out of your business, then you have no clear picture of the financial health of your company. This could make for some uncomfortable surprises when you start digging into the numbers.

A budget is a roadmap for your company, so whether you are just thinking about starting a business, you’ve got some side hustles going, or you have a full-time business, you need to figure out a budget so that you know where your company is headed financially. You can’t effectively plan for business growth without knowing where your money is going.

2. What should be included in your small business budget?

When you are starting out as a small business, it can be hard to know how to make a reasonable and realistic budget. You may have significant start-up costs, or you may be able to hit the ground running with just your laptop. Remember that a budget is your plan to understand and control your finances, ensure that you have enough cash flow to pay your bills, and plan ahead for the future of your small business so that you can make confident financial decisions.

Regardless of industry or how you set up your business, you need to have a solid budgeting process in place. A standard budget should include the following:
- Cash flow projections: your cash budget allows you to project your cash position on a month-by-month basis.
- Costs: for a typical business, your costs can be broken down further into three different categories:
  - Fixed costs: these can include salary, rent, and financing costs
  - Variable costs: these can be inconsistent but should be accounted for, and could include things like overtime pay for staff
  - One-time capital costs: This could include the purchase of computers, equipment, a business location, or other one-time capital expenses.
- Revenue: these are current sales or other income and can also include a forecast based on sales history and how you expect your small business to perform in the future.
3.What are your regular expenditures, and do you have significant capital expenditures coming up in the fiscal year?

Budgeting well involves anticipating both your regular expenses and big, unexpected, or one-time expenses that may come up in the fiscal year. When you are working on your budget, think about expenses that you need to plan for in advance. It can be all too easy to just think about your regular, month-to-month expenses, but your actual expenditures are also going to include one-time, capital, or unexpected expenses, so you need to plan accordingly.

Is there equipment or technology that will need upgrading or replacing? Do you have a peak sales season that will require you to purchase more inventory in advance? Are you planning to move into a brick-and-mortar space? Think about the unique aspects of your small business that may require significant capital this year, and plan ahead to make sure your business stays on track financially.

4. What are your projected sales for the next quarter and through the end of the fiscal year?

Using both sales and expenditure forecasts can help you project your profit margin for the next 12 months, which will allow you to make smart, fiscally sound business decisions. If you want to grow your business, you’ll need to know what your profit margin is so that you can wisely invest in new products, services, marketing campaigns, or technology. Using both sales and expenditure forecasts allows you to see how much money you spend on different items. By knowing how much you spend on certain items, you can plan ahead and save money.

5. How often should you review your budget?

Let’s say you have done all of the above. You have your budget and projections and business plan, you have a good idea of what the coming fiscal year will look like, so you’re done, right? Well, not really. Budgets aren’t a one-and-done item that you can check off your to-do list forever. They need to be reviewed and updated regularly to ensure that what you laid out in your budget actually matches the reality of where you are spending and making money with your small business. This doesn’t mean you need to go over it with a fine-tooth comb every day; that wouldn’t be an efficient use of your time. Instead, your budgeting process should include time to review your budget at least once a month, with a more in-depth look at your annual budget a few times a year to make sure that you are meeting your financial goals. If you are not meeting your goals, then you need to adjust your budget accordingly and maybe revisit the strategic plan for your small business.

Working with an experienced bookkeeper can help make your budgeting easier. Sound Accounts works with businesses of all sizes and we offer bookkeeping, licensing, payroll, quarterly reports, office management, and notary services 100% remotely. Let us keep your accounts safe and sound so you can focus on your business.

For some answers to common business budgeting questions, check our our frequently asked questions here:

FAQ’s

What is a small business budget?

Like any other budget, a small business budget is a document that helps you identify your financial needs. It also serves as a tool to help you manage your finances. Your budget should include three main categories: income, expense, and cash flow.

How do I set up my small business budget?

The first step is to determine what your monthly income is going to be and what your monthly expenses will be. Then, you’ll add up these two numbers to get your monthly net income. These may just be guesstimates when you are first starting out as a new business owner, but even having a general idea can help you make good budgeting decisions when you are just starting out.

How often should I review my small business budget?

Budgeting is an ongoing process. You should review your budget at least monthly to ensure that your small business finances are on track. You should also take time quarterly to review it more carefully and plan for big expenses, capital improvements, or peak customer seasons that may come up in the fiscal year.
December 8, 2021
How do I Know it’s Time to Expand My Business?

Small business ownership is a journey that is full of unknowns, especially in the beginning. It is exciting to own your own business, but it can also be challenging knowing that all the decisions fall on you. One of the biggest decisions you’ll face as a small business owner happens when you ask yourself, “When is the right time to expand my business?” Here are four signs that your small business might be in a good place to expand.

1. You have outgrown your space, or you can’t keep up with demand

So you’re bursting at the seams at your current location and you are so busy that you can’t keep up with your customer demands. That’s great news! But that’s also a clear sign it is time to expand your business.

If the demand for your product and service exceeds what you can produce, it is definitely time to expand. There is clearly a target market for what you have to offer. If your customer base is clamoring for more, why not expand your business and make the changes necessary to meet the demand?

Outgrowing your space is also a clear sign it is time to expand your small business. Whether you and a business partner have outgrown working from your dining room table, or you own a bustling coffee shop with lines that stretch out around the block, you are clearly ready to expand to a space or location that better fits your needs.

2. Your business requires a skill set that you don’t have

When you are just starting out, it is on you to handle all the details of managing your own business. Regardless of what type of business you run, product you create, or service you offer, you are also in charge of your own marketing, accounting, customer service, and more. As your business grows, you may find that you no longer have the skill set to take your small business to the next level. If your business is doing well enough that you have the budget to hire staff or outsource work to experts, then it might be a good time to expand.

If you think you can get more leverage from better social media marketing campaigns, then expand your staff to include someone to do just that. Or if you see a need in the market that you’d like to support, but don’t have the skill set for, bring on a new partner who does. It’s hard to let go of the reins, but bringing in an expert who can fill a need is a great way to expand your business.

3. You recognize the need to diversify

Let’s say that your business is going well, but you have noticed a plateau. You have a steady stream of customers, but they are the same customers coming in over and over. This is one sign you may need to diversify your product or service offerings in order to get in front of a new audience. That’s not to say that there is anything wrong with having repeat customers; the fact that you have loyal customers is great news for your growing business. But if you’ve hit the ceiling of how far you can grow your business with your current product and your current customers, then diversifying can be a great way to expand your business. You’ll have a steady cash flow from your existing products and services that can give you the financial stability and the confidence to branch out and try something new.

On the flip side, you may be offering dozens of products and services, but only one of them is profitable. You’ve got a golden egg, but you’re not sure if that is sustainable. Take a step back and consider how you might scale down or eliminate underperforming products and services. Also, take time to consider that another reason you might need to diversify is that you recognize that of all the services and products you are offering, only one of them is making your “golden egg” successful and think about how you might take what you’ve learned to create more successful products. Diversifying strategically can ensure you aren’t counting on just one thing to keep your business afloat.

4. Your business is in a good place financially

Maybe none of the above applies to you, but your small business is in a great place financially. You have a positive cash flow, your customer base is happy, and you are comfortable. That’s great! But that might also be the nudge you need to try something new. If your business is doing well, it could be an excellent opportunity to think about a new product you’ve been meaning to test out, or offer an additional service that could expand your customer reach. Take small steps to test out growth opportunities, knowing your business is financially sound.

When you are ready to expand your business, Sound Accounts can scale up our services to fit your needs. We support small businesses at every stage of growth. Contact us to find out more about how we can support your growing business.

For helpful info on expanding your business, check out our frequently asked questions and answers below.

FAQ’s

What are some signs that it’s time to expand my business?

If you have grown out of your workspace, are unable to keep up with product demand, or want to diversify your offerings, then it might be a good time to expand. If your business is in a financially healthy place and you want to grow, this is also a good sign that it is time to expand.

What are some things I should consider when I’m preparing to expand my business?

Some things you should consider are: Is my business financially stable? Is there a market for the product or service I want to expand to? Do I have a physical need to get into a bigger space? How will I define success as I expand my business?

What are some questions I should ask before I expand my business?

If you are thinking about expanding your business, here are some questions to ask yourself: Are you growing out of your current work space or business location? Are you unable to keep up with demand? Is there a skill set that you don’t have, one that could help your business grow? Do you want or need to diversify your products and services?

November 10, 2021