Your business’ move from start-up to growth phase doesn’t happen with a lot of fanfare. There’s no easy -to-identify moment when you relax and declare, “Now we’re on our way.”
But as your company gathers momentum, it evolves and its critical that your business and financial planning keep pace with that evolution. Here are some important issues owners of growing businesses should consider:
Business Processes
Policies and procedures aren’t glamorous but they are essential to managing the increasing complexity of a growing business. Established processes can help you delegate to and develop existing employees, while accelerating the effectiveness of new hires.
Determining key performance activities and tracking them weekly/monthly, can measure success well before your financial statements are ready. Sharing this information with your staff also helps them self-manage.
Cash flow
As a business grows, cash flow needs may change. An expansion can be supplemented by financing but ultimately relies on cash flow to repay/revolve the debt.
A revolving line of credit can help but work with your accountant on procedures to streamline payables and collect receivables to increase company cash flow.
Unforeseen circumstances
Could your company survive if you were unable to work? Would your personal investments be protected from creditors if your business failed?
With the assistance of tax and legal professionals, consider an asset protection strategy. This may include incorporating your business, liability coverage, insurance investment products and key-person life and disability insurance.
Employee retention
While compensation is important, employees also consider flexibility, camaraderie and company culture as reasons they stay or look elsewhere. Consider a group benefits/retirement plan and creative perks and incentives for employees. At a certain level, a human resources consultant will be a valuable part of your management team.
Personal financial planning
Sometimes your business goals can push your own goals down the priority list. A personal financial plan – aligned with your business objectives – can help you enhance wealth, reduce debt, protect your family’s lifestyle and develop a sustainable income stream for retirement while leaving a legacy for your loved ones.
Surround yourself with the right team
If you don’t already have a team of professional advisors in place, seek out an accountant, lawyer, banker and financial advisor you can trust.
submitted by Dan Allen, financial advisor specializing in retirement income and protection planning. He has over 30 years’ experience working with business owners and can be reached at 519-822-3887 ext 109 or at dan@theheritagegroup.ca
