Anyone who starts a business wants to see it grow. But moving through the different stages of a business’s growth cycle isn’t always easy. Getting finance in place, hiring the right people, moving at the right pace into new markets – they are all risky and can be difficult. Anyone trying to leave startup status behind and become a more mature business will recognize it’s tough.
In fact, a recent FSB report, Wales’ Missing Middle, revealed that while in general micro-business and large corporate sectors had flourished over the past 15 years, businesses that lay between those two ends of the spectrum had fared less well, lagging behind in growth rates.
And for Wales, read the UK, where the growth in firms employing between 10 and 200 people has failed to keep pace with those at either end of the size scale.
This is partly an issue of finance: According to FSB’s most recent Small Business Index (SBI) data, 42 per cent of small business owners say credit availability is very poor (19%) or quite poor (23%). Just 24 per cent feel credit is readily available.
These numbers improved between 2012 and 2016, but have weakened in the past two years. However, there is more to it than simply a lack of funds. For those keen to escape the trappings of the startup world, it also requires a shift of working practices, business systems, and mentality.
Ready to step up to the next level?
So how do you know when you’re ready to step up to the next level, and how can you make the journey easier? A few good signs might include:
- Your systems – financial/accounting especially – are no longer fit for purpose (eg you’re still running everything off an Excel spreadsheet
- You as the owner are not able to run everything anymore, making you more reliant on good staff
- You fall behind on the financial administration of the business – tax liabilities especially
- The office is too small to accommodate everyone
- You spend too much time trying to run things day to day and not enough on looking for new opportunities
- Routine business gets in the way of the next stage of growth
At this point in your growth story, the emphasis will likely switch from accelerating to consolidating growth; owner-managers must relinquish absolute control over day-to-day operations; and, systems and processes that might work for a start-up may become dangerously stretched. But there is a way through…
Next week: How to make the transition to mature phase a smoother process
As experts in the field, we work to help our clients to decide what’s right for them as their business grows. We’re here for whatever you need, and you can contact us for help and support in a number of areas, from tax and payroll to accounting and banking.