Transition from a One Person Band to a Medium Sized Business

Transitioning from a one-person band business to a medium-sized business is a significant step for any entrepreneur and a common one in New Zealand. It involves expanding the business operations, increasing the customer base, and hiring new staff to handle the growing workload - not to mention finding the funds to pay for the growth. In addition to managing the existing aspects of the business, new processes and systems must be implemented to handle the growth. In this blog post, we will explore the key areas that need to be considered when transitioning from a one-person band business to a medium-sized business, including staff, accounting, marketing, sales, and administration.

Staff

As the business grows, it becomes impossible for the owner to handle all tasks. This is where staff comes in. The most frustrating thing in growing your business is that the most important areas you will hire people will be cost and not profit centres. Hiring new staff is a crucial step in the transition process. This includes roles such as customer service, marketing, sales, accounting, and administrative staff.

The recruitment process should be done carefully, and the new hires should be provided with adequate training and support. It is also important to establish clear lines of responsibility, accountability and strong team culture to ensure everyone is working towards the same goals.

Accounting

Business growth makes the accounting function becomes more complex. It is important to hire an accountant or finance manager with the necessary skills and experience to manage the finances of a medium-sized business. They can provide valuable insights into the financial health of the business and help to identify areas for improvement.

In addition to hiring an accountant, it is important to implement robust accounting systems and processes. This will help ensure that financial information is accurate and up-to-date, which is vitally important if there is a need to raise capital or get bank lending, or the addition of overheads or costs into the business, ensuring bills can be paid, is the #1 requirement of growth.

Marketing

Marketing is a critical area for any business, but it becomes even more important as it grows. It is important to develop a strong marketing strategy to attract new customers and retain existing ones. This may involve hiring a marketing manager or engaging the services of a marketing/social media agency. It is important to ensure that the marketing strategy is aligned with the overall business strategy and that it is focused on delivering results. This means identifying the target audience, developing a messaging strategy, and selecting the most appropriate marketing channels. It also needs to be implemented by a person who didn't start the company, so it is very important that parameters are laid out for those undertaking the function.

Sales

Sales drive growth in most companies. It may be necessary to hire additional sales staff or establish a sales team to manage the sales process. This will help to ensure that the business can manage the increased volume of sales and meet the needs of its customers. It is important to ensure that the sales team is properly trained and has access to the necessary resources to perform their roles effectively. This may include access to customer data, sales tools and training programs.

Administration

As the business grows, administrative tasks become more complex. This includes tasks such as bookkeeping, payroll, and general day-to-day admin tasks. Hiring administrative staff or outsourcing these tasks to a reliable service provider is important. Ensuring that the administrative systems and processes are streamlined and efficient is important, and taking advice on automation is recommended. This will help ensure the business can manage its administrative tasks effectively and focus on the core business operations.

In conclusion, transitioning from a one-person band business to a medium-sized business is an important step towards growth and sustainability. By focusing on key areas such as staff, accounting, marketing, sales, and administration, businesses can establish a strong foundation for growth and long-term success. By investing in these areas, businesses can streamline operations, attract new customers, and increase their revenue and profitability.

Propeller Consulting can help you on this journey as experts in advising New Zealand small businesses on their next steps. Get in contact today.