When you first start out in business, an advisor’s role is to educate.
What does the IRD need from you? What are your responsibilities as an employer? What can you charge for what you do? It’s all about financial literacy; understanding your budgets and what your numbers are going to tell you in terms of cash flow, profit and the balance sheet.
And it’s important to get this sorted from the start. (For more about the art of getting your startup moving in the right direction early, check out another post of ours; "Busted! 10 myths about start-up success".)
As you gain traction in your business (thanks to working your butt off), you need the right people around you, so investing in advisors is money well spent.
A lot of the advisor’s role at this point will be support. At RightWay, we meet business owners on a regular basis so they are forced to come off the tools and work ON their business. We also make you accountable for your business goals and actions and show you whether the numbers are working for you, with the help of Xero.
For example, if you’re in the hospitality business, wages and food purchases are the two biggest expenses you need to be aware of at all times. We can work out the industry average for your business to make sure you’re sticking to the right ratios to avoid cutting into the bottom line and stunting growth. We can also show you how to do forward reporting so you know there’s enough cash in the bank for things like PAYE, GST and income tax.
Making solid ground
Once your business becomes more mature, it’s time to ask yourself if the hard yakka is worth it. Is your heart in it? Do you want to grow further? If your answer’s yes, then it could be time to tweak the business model – and we can help you with that. Do you have the right target market? Is how you’re getting the product to the customer working for both of you? We can help you answer these questions and test any new ideas.
If you’re happy to carry on as is, we can help sharpen the profit and loss. Or if you’re thinking it’s time for an exit strategy, we’ll make sure the systems and processes are tidy and attractive for a potential buyer.
Advisors can help now and in the future – the best plan is to get them on board as early as possible and then as you grow, they’ll be alongside you.
To find out more download our eBook: 10 tips for busy business owners - A practical guide to running your small business better.
Getting sound business advice from people who know their stuff (whether it’s accountants, lawyers or the bank) is crucial for any business. So when’s the best time to bring them on board? And what support do you need when?