Are you struggling to grow your business? Benjamin Dyer reveals the five things that most commonly trip people up when trying to expand their copany and explains how to tackle them
Running a business can be challenging - but that shouldn't stop you trying to grow your business and reaping the rewards. Here we look at five of the most common things that stop a business from growing and what you can do about it:
1. Not quoting for new work
Every time you are asked for a quote, it's an opportunity to grow your business. And the biggest complaint many homeowners have about trade companies is that they can't get quotes out of them.
Sure, if you are busy, not getting around to the quote means an easier life, but you will never grow that way. If you have too much work, don't stop quoting. Instead, raise prices slightly, be more choosey about who you work for or increase your capacity by subcontracting work or employing another person. Quotation opportunities have huge value, so make the most of them.
2. Failing to fix mistakes quickly
Research has shown that customers who have had problems resolved quickly will be more loyal than if nothing went wrong in the first place. So, when you make a mistake (as we all do from time to time), fix it quickly and professionally. It's the chance to gain a loyal customer for life. The alternative is a world of pain and wasted time, plus upset customers bad mouthing you online and behind your back.
3. Not reminding people when they next need work doing
There are lots of times when your customers should be coming back to book you again. We had a tree surgeon visit us to give us a quote for some work. They pointed out that the poplar trees need pruning every year. If they remind us next year at the right time, they will be more likely to get the work.
4. Working for customers looking for the lowest price
When customers are very price-sensitive, they can also be among the most unreasonable as well. And a low price means more risk and hard work for a smaller reward. If you sniff this out, it is best to politely decline the work. This is the one time it may make sense to pass work by.
5. Not moving on from a sole trader to employer
It's hard to take on your first employee and there are all sorts of complications. You have to worry about PAYE, pensions and employment law. It's difficult. But if you never take the leap, you will never really grow your business.
The key is to think carefully about that first step in getting your first employee. Yes, there's the admin but you can get your accountant or bookkeeper to help with that.
The hardest thing is that in one jump, there are two mouths to feed so your sales suddenly need to double. Here are three ideas that might help:
- Sub-contract until your sales grow to a level where two people's wages can be supported. Although you might have to accept less profit in the short term, it could get you over that hump;
- Take on an apprentice. They can be cheap at first but you can watch your sales rise as they become more productive (although they will become more expensive);
- Wait until you get a big job when you know you will have plenty of work (and money) for an extra pair of hands.
Written by Benjamin Dyer, co-founder and ceo of Powered Now Invoicing App, helping tradespeople to simplify paperwork and save time.