Did you know that despite the unprecedented times we’ve been through over the last 18 months in Australia, 365,480 new businesses started up in FY21. Think about that. A global pandemic. Much of Australia is in lockdown or under severe restrictions. Businesses impacted like never before. Sadly 277,674 businesses exited or closed, resulting in the ABS reporting total businesses overall increased by 3.8% during FY21!!
The challenges start up businesses face
Starting up a business is hard at any time. I shared my own experience about starting CircleSource a few years ago. But starting up a business during a global pandemic requires serious courage and belief in what you are doing. I came across this article The Main Issues Affecting Small Businesses in Australia | Join Fantastic which sums up nicely some really core challenges people face with starting up their business. No surprises really, things like Poor Business Planning, Good Cash Flow Management, Bad Marketing, Not setting targets early on, Hiring the wrong people, Fatigue, Returning Customers. All fundamental and critical that business owners should be thinking about. The fact is it’s these fundamentals many new business owners get wrong.
But what caught my eye is Business Owner Fatigue and Hiring the wrong people. Let’s explore these. Fatigue, the business owners worst habit. We try to do everything. We know cash is hard to come by in the early stages. So we compensate and try to be a jack of all trades. Big mistake. The end result is we usually run ourselves into the ground and do a poor job identifying the things we can’t afford to get wrong.
The other one is linked. Hiring the wrong people. When you bring people in to help out your business, it’s really important you get this right. Mistakes can be costly and because you are even more fatigued, more than you had already thought, not to mention how quickly you burn cash.
When should your business commence to hire people?
I think the real question is for a business owner of a start-up is, when do I really need to hire people? The other one is, do I really need to lease an office for my business. I mean, unless you need a shopfront because you sell stuff an office is a business expense you should not incur until you absolutely have to.
What’s your role in your business, and what expertise do you bring
Facts are when your business is in its early stages, it’s critical you assess the skills and expertise you need to run your business. Start by figuring out what your role in the business will be, what skills and expertise you provide to the business and what additional skills you need to acquire or take on board. If you’ve got a co-founder, they too will bring a skill set so that’s a great start.
Importantly, acknowledge your limitations or the skills that your business doesn’t have. And critically analyse whether you need the skills or expertise inside the business, as an employee, or if you need only to access the expertise when you need it…this is critical. If you’re not good with numbers and have no attention to detail, get a bookkeeper to manage your financial accounts. What level of marketing do you really need to drive your brand into the market and how should you resource it?
Know your skillset, hire resources to fill the gap
Unfortunately, too many businesses miss these important considerations. They either overlook the importance of these skills until it’s too late or hire resources into the business too early. The core needs of most businesses are pretty similar. Most need a level of Technology support to help build and support their website or manage their products. Marketing is important so it’s critical to understand what your needs are and how you resource them. All businesses have financial and accounting needs. Same as Human Resources specialists, you need only access this expertise to help you get the core frameworks in place initially. When you need legal advice on business partnership agreements, ASIC requirements, shareholder agreements, sale contracts, where do turn?
Facts are the majority of SME businesses and Start Ups will not need to have these specialists employed by their business when they commence. Just like you won’t need that office even though it feels great to tell people you have one. But every business will need access to these experts at some stage. Sometimes quite regularly. So you will need a way of finding and accessing these experts when you need them.
Access specialists when you need them
That’s where www.circlesource.com.au is exactly what SME’s and Start Up businesses need. It helps you find, connect and engage the independent expertise your business needs, when you need it, on the terms you need them. I know of many small businesses who turn to CircleSource to source and engage the specialist service providers their business needs, when they need them.