Ready... Set... Grow...

Growing a business is not a sprint. It’s a marathon baby, a long distance adventure that demands focus and determination, requiring much more than increasing your sales. As a business breaks out of its “small business” shell, a paradigm shift must occur in the business owner’s mind if the business is to flourish. Thinking only about today is no longer an option. Business owners are faced with a whole new level of challenges and they need answers to questions such as: Is the business headed in the right direction or are we simply “growing?”

  • How do we manage millions in sales and the headaches and costs that come with it?
  • What are the specific key performance indicators of my business and what are they telling me?
  • How do I manage more employees and keep them motivated and efficient?
  • Are we as profitable as we should be? Why or Why not?
  • Would we make more money expanding or downsizing?
  • Are we selling to the right market at the right price and the right way?
  • Should we buy, build or lease our manufacturing plant?
  • What are the tax effects of all this?

A good way to start the growth planning process is to think about what you want your business to look like in 10 years.  Preparing an organizational chart complete with titles, job descriptions and qualifications to meet your future company’s needs is a great exercise to help focus on your vision.  Remember that it costs nothing to dream, so dream big.

Remarkably, when we set the goal, as high as it may seem, we have a tendency to gravitate toward it.  As an added benefit, sharing this challenging vision with your people clearly illustrates your intent to provide opportunity to those who seek it.  Having a solid infrastructure to support your company’s growth is critical for its survival.  For example, human resource issues such as hiring and orientation programs, employee handbooks, performance management and leadership training are all necessary to keep your people on track. In addition, your employees must feel that they are giving their time to a well organized, secure and stable employer.  It is critical that you establish comprehensive employment practices because it sends a clear message to your people that you are serious about their well being, not to mention the growth and health of your company.

Once the right people are in place, what will the numbers look like?  Budgeting and cash flow projections are necessary to evaluate whether your company’s direction makes economic sense.  As your business grows, it is very important to focus on maintaining consistent profit margins, removing poor paying customers and keeping overhead as low as possible.  Monitoring key performance indicators such as liquidity, solvency and profitability trends will make sure that you are growing at a healthy and manageable rate.  In addition, having a good working relationship with your CPA and a banker can help you secure financing to pay for relocation costs, new equipment or inventory build up.

As your business grows, your tax situation becomes a constant sea of change that requires precise navigation.  Your CPA should keep you current on the actions of congress and decisions of the IRS and the courts as they relate to your business.  Keep in mind that the tax you pay can have a significant impact on your cash flow, so keeping your tax to a minimum frees up much needed capital to help fund your growth.  Regular tax planning meetings throughout the year will help give you a “heads up” on what’s coming April 15th.  This preemptive planning strategy will also give you ample opportunity to make decisions before year end to reduce your tax burden.

Okay, now here’s the shocker.  Your accounting and marketing teams should work together.  That’s right, you heard me.  Sound crazy?  We all know that in college, they never sat at the same lunch table and definitely didn’t dress the same.  They were the “bean counters” and the “creative freaks”.  But in business, these two disciplines working together provide a synergy that can produce exponential results.  Your CPA should have an active involvement with your sales and marketing team in developing your sales growth plan.  Remember, increased sales are good, but increased profitable sales are better.  Your CPA can help you identify the most profitable product or service lines of your business and work with your marketing team on a comprehensive sales growth campaign, delivering it to the right audience.

I’d like to leave you with a quote by Sydney Friedman that clearly summarizes what it takes to succeed in business and life:

“You can achieve anything you want in life if you have the courage to dream it, the intelligence to make a realistic plan and the will to see that plan through to the end.”

Have a profitable day!

James N. Chakires, CPA, President & CEO, APEX CPAs & Consultants, Inc. and Strategem Group Marketing, LLC.  Apex CPAs celebrates its 10th year by supporting middle market businesses in 3 key areas; Vision, Guidance, and Growth, helping business owners see their goals, guiding them there and implementing sales growth strategies to reach them. Apex’s revolutionary 3 dimensional integration of accounting, consulting and marketing is first in the marketplace.

 
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