Transitioning from a small business into a larger operation has lots of positives. Fundamentally, you can expand your customer base, increase the number of services you provide, hire specialist employees, and make bigger profits. However, there are also new legal, financial, and organisational considerations to take into account before you take this leap. If you’re not properly prepared for the expansion of your business, the process may be messy and certainly a little stressful.
So if you’re looking for some key advice on taking your small business to the next level, check out the pointers below.
Legal Considerations
Hiring employees (or operating with a larger workforce) comes with legal guidelines that you need to be in line with at all times. The law may vary in different states, and depending on how many people you are taking on, but more often than not there will be guidelines on hiring processes and equality, interview processes and training. So make sure you are up to date on all the latest legal obligations in your area, and plan your hiring process carefully.
Resources And Equipment
It’s no use having a bigger workforce if they don’t have the equipment and resources to do their job well and – just as crucially – safely.
So make sure you can afford to invest in all the safety equipment needed to keep your new employees protected, as well as practical tools, specialist equipment and transport. All-in-all, these investments can amount to a major investment, especially when you take the new salaries into account too.
If buying new equipment outright is not an option, look into rentals. This is especially useful if you’re hiring seasonally, or for a few bigger contracts. Rather than splashing out on a new truck, try commercial truck rentals from Flex Fleet, for a more affordable, short-term alternative. You can find rental companies for most specialist equipment.
Management & Restructuring
In a small business, the business-owner and existing managers often take control of managing the team, training, dealing with admin and payroll. You’re essentially doing the job of multiple people until you can hire others to take the responsibility off your hands. However, when you expand your workforce, you will want to consider restructuring your management approach. You may need to hire additional managers, and set-up a separate training system to help newbies settle in.
Hidden Costs and Expenses
Hiring new staff will help you generate a great profit in the long run. But the process of bringing new people into the team has a number of hidden costs that can amount to major expenses. In some cases, the costs may actually outway the benefits, so careful financial planning is necessary before you get started. To begin with, advertising for new employees costs money. It then takes time to read applications or conduct interviews, and then your new employer will need training. This all uses up time and resources that previously would have been making you money.
New salaries will also likely increase the tax your business pays, although there may be tax breaks and benefits to be found too. You may need more space, perhaps new office premises, equipment and transport vehicles. If your business has enough demand to warrant expansion, you very likely will have the resources to cover these costs if you plan carefully. But be sure to prepare yourself for these initial losses.