The Road To Growth Business Advisory was established to help owners of SMEs build growth in their business that is both profitable and sustainable for the long-term. In particular its aim is to address the disappointment owners feel when their business doesn’t match up to the hopes they had at the outset.
When most businesses are formed the founder’s dream or vision is usually of a life where there is little stress (they’re their own boss now); where the team under them has everything under control, meaning they can now work a relaxed five-day week – if that – with relaxing holidays away from the business routine; and where they can indulge in a few of the luxuries in life, whether they be a new car, overseas trips or new, bigger home. But …
What does history tell us about what usually happens?
Sadly, this rarely turned out to be the case; in fact the track record for new small to medium-sized businesses (SMEs) in Australia is far from encouraging.
Some reports have suggested 35% of small businesses close within 5 years of being established with a further 20% closing within 10 years, while others will tell you that more than 60% of small businesses will close within 3 years. While the difference between such figures gives little faith in their accuracy what does become apparent is that the success rates are not encouraging, and are far from what most founders had in mind when they opened their doors.
Why Is This?
Are You Ready To Change?
Why Is This?
But if SME owners are so highly committed to their business (and they overwhelmingly are), then why are their businesses not all roaring successes?
For the most part it’s certainly not due to lack of effort on the owner’s part, because most owners work much longer hours than their staff (including weekends) for relatively little financial reward (on some occasions nil), yet still struggle to keep their heads above water, let alone make progress and grow their business.
No, the main reason is that there’s a huge difference between being the person who makes the products or provides the services that you sell, and being a business owner.
When the ABS analysed why businesses closed they listed some of the main reasons as lack of financial awareness; a neglect of strategic issues due to a focus on operational ones (which is usually a strength of the owner); a lack of systems; and no established quality programme.
So it’s clear that if business performance is to improve then things need to change. There are a handful of issues you’ll need to address if you want to start raising the performance of your business, but if you really do want to improve things the first step is far and away the most important.