Reaching a growth phase is a major achievement for any new business, but what happens once it’s time to scale up? It’s important to plan thoroughly to set yourself up for success, which is why we asked the team at Xero and a sole trader who’s been there for some insights on how to grow your business in FY22.
Josh Howard is a sole trader who knows a thing or two about business growth. As founder and CEO of Single Use Ain’t Sexy, he launched Australia’s first brand of dissolvable hand soap tablets last year, successfully creating an engaged customer community in less than twelve months.
SmartCompany asked Howard to combine his experience with expert advice from Xero’s Complete guide to growing your business resource — all to give you the top tips on how to grow your business in the new financial year.
Be patient and plan creatively
According to Xero’s Tipping point research, 28% of sole traders who thrived through 2020 attribute their success to adapting quickly to new business conditions. The best way to prepare for this? By planning early, and considering different growth strategies based on where you’re at with your business.
Start by identifying what stage you’re in: startup, growth, or expansion. If you need some help identifying which of these options fits you best, check out Xero’s guide.
Wherever you’re at, persistence is key. Growth doesn’t happen overnight, and you need to be prepared to stick it out.
“There’s no one way to get to a goal or achievement. And if you can plan well, and be really smart and creative, it can pay off in the long run,” advises Howard.
Whether you lead a small team or are going it alone, you’ll find the support you need at Xero’s dedicated resource page — complete with free tools and guides to help everything run smoothly. Xero is online accounting software designed to let you do business beautifully and simply, nab a free 30-day trial today.
Ask yourself if you’re ready for growth
It pays to evaluate your preparedness, and research heavily before pushing ahead with a growth strategy. This can include assessing the market as well as any risks, and crunching the key numbers such as forecast sales, overheads and inventory costs.
Howard’s advice for when your research takes you into unknown territory? “Just Google it.”
“I come up against probably 20 things every day that I don’t know. That can be anything, even how to structure a fundraising round.”
“Through the beauty of Google and YouTube tutorials, we have access to so much information.” And as a business owner, Howard says it can be empowering to find these answers for yourself.
Once you’ve researched, be sure to seek out professional and peer advice.
“Appointing an advisory board is a really smart idea,” says Howard.
“It’s a really savvy way of getting experienced people into the business who have done it before.”
As well as an advisory board, investing in a bookkeeper or accountant can help you stay on top of your numbers and achieve your growth goals with a range of support options. Xero’s Advisor Directory can help you find your right fit, with thousands of advisors listed by location and industry.
Set SMART goals
SMART goals stands for specific, measurable, achievable, relevant, and time-based. Setting goals that follow these criteria is crucial for small business owners, especially sole traders, as they provide an invaluable measuring stick for your future growth.
“I was never someone that set personal goals for myself,” says Howard.
“But I quickly realised that if I didn’t set goals for the business, I wouldn’t have a North Star to work towards.”
If the success Single Use Ain’t Sexy has achieved in the past year is anything to go by, it seems Howard is on the right track.
“We’ve sold out twice in our first 12 months of business, which I was not expecting. It’s really exciting that the community has embraced us so passionately,” says Howard.
Write a business development plan
A business development plan is just like the regular business plan you would have made when you started out as a sole trader, but with a focus on growth and how to achieve it. Having a plan like this is key to maintaining steady, sustainable growth. Ideally, your business plan should cover growth opportunities, funding, sales, marketing and team needs.
As your business grows, take note of your progress and make periodic adjustments to your business development plan to make sure it’s still relevant and meets your current needs. Remember, growth takes time, so be prepared to put the hard yards in.
If you find yourself stressing over tiny details in the planning phase, Howard encourages business owners to ditch perfectionism and strive for growth.
“You’ve got to get things to a place that you’re happy with, but don’t hold back… It will never be perfect,” he says.
Find your levers to increase sales
Once you’re armed with a business development plan and are prepared to charge ahead, ramping up sales is a great way to create growth by leaning into your strengths and what works for your market.
“Identifying your levers is important, because then you can figure out where you put in your time, money and resources,” says Howard.
“Try not to spread yourself too thin. Figure out the three or four things that really worked for you to generate sales, then lean into those,” he says.
Consider selling more to current customers and nurturing customer loyalty through rewards, bundle deals, and special offers. These initiatives can serve a dual purpose depending on your goals, either increasing average order values or rewarding your most loyal customers.
Next, research your ideal customer and how to appeal to them, whether that’s through influencers, media coverage, ambassador programs or a strong social media presence.
Overall, Howard’s top tip for growth is to “make it fun”.
“Growing your business is about engaging people and enticing them into the world or community you have created.” No matter what stage your business is at, reaching the growth phase is an exciting achievement that should be celebrated. For more advice on how to create sustainable growth as a sole trader, read Xero’s Complete guide to growing your business.
Xero is a cloud-based accounting software platform for small businesses with 2.45 million subscribers globally. Through Xero, small business owners and their advisors have access to real-time financial data any time, anywhere and on any device. Xero offers an ecosystem of over 800 third-party apps and 200 plus connections to banks and other financial partners.