In the ever-changing business world, success comes from different ways of doing things. Small businesses, centres of new ideas and imagination, are naturally good at finding their paths to doing well. Many things make them successful, but business growth and small business accounting are two major factors.
According to the 2022-2023 Australian market summary of CPA Australia, 2022 showed significant growth for small businesses in Australia, marking the most robust performance since 2017.
However, 2023 is anticipated to be a more promising year for small businesses in Australia. Especially since small enterprises constitute over 98% of Australian businesses, small businesses play a pivotal role in local communities through their substantial contribution of $700 billion to the country’s GDP.
This blog post will share the essential steps that small business owners need to achieve business growth in 2023, and it also explains the importance of small business accounting.
Four Strategic Moves for Business Growth
The caterpillar-butterfly analogy is one of the metaphors used when discussing embracing change and becoming a better version of ourselves.
Aside from personal development, this analogy is also applicable to small businesses. There is a challenge to grow and shape your business from a small enterprise that caters to a few (caterpillar stage) to one that provides diverse products or services for all kinds of customers (butterfly stage).
We know the business landscape can be overwhelming, so here are four tips to help you transcend your startup from a caterpillar to a butterfly.
Gain Insights into Your Consumers
When you establish your business, you already know who you want to sell your service to. However, focusing on the people you want to sell to or those who patronise your enterprise is insufficient.
Consider how you can reach people unaware of your business but would significantly benefit from purchasing your offers. Some key factors to analyse are their demographics, psychographics, behavioural patterns, and needs and pain points.
While brainstorming how to reach a new consumer group, you must also strategise on how to maintain your current client base’s loyalty. Please take note of their feedback, complaints and best-liked features about your service or product. This will help you adjust your business plan accordingly.
Make corporate social responsibility a part of your identity
Corporate social responsibility can be intimidating since small businesses have limited resources. But, there are simple methods to implement CSR that align with being a startup and can effectively promote business growth.
Integrate CSR into your hiring process by upholding equality, diversity, and inclusion. These values align with ethical business practices and contribute to your startup’s overall success and positive image.
Also, extend your commitment beyond the workplace by engaging with the local community. Support community events, initiatives, or causes that resonate with your business’s vision and mission.
Harness the power of social media
One vital element consumers look for in a small business is social proof. What better way to showcase people’s support of your business than by sharing your business journey on social media?
There are various social media platforms that you can leverage to share your startup’s story and how it has managed to help your customers. Recommendations from clients who had a positive experience create a ripple effect of credibility. Images, videos and other user-generated content customers share using your products can be compelling social proof.
Furthermore, interacting with your audience on social media is crucial. Responding to comments, messages, and feedback shows that you value your customers’ opinions and are actively engaged with them. This level of interaction can foster a sense of community around your brand.
Track and measure your business’s financial health
Have metrics in place so that you have a way of checking if you are achieving your desired business growth. You need to keep track of your revenue, profit, and market share.
While having high revenue is impressive, you need to be cautious in spending because higher sales usually translate to higher costs. On the other hand, profits are calculated after subtracting the expenses from the revenue. Therefore, it is ideal to have a steady profit with a healthy margin.
Lastly, you also need to pay attention to market share because this provides you with a comparison of your market size to others in your industry. Growing market share quickly is vital for new companies entering the market.
Monitoring all these figures can be overwhelming. This is why small business accounting is critical to the success of your small enterprise because it can act as a compass, helping you work your way through the constantly changing financial environment and make wise decisions that drive sustainable growth.
Why Small Business Accounting Matters
One of the most integral administrative tasks business owners must do is their day-to-day accounting.
Small business accounting mainly centres around tracking your business cash flow and consolidating the numbers into financial statements that can be used to formulate strategies to trigger business growth.
Entrusting your enterprise’s accounting to a Certified Public Accountant has numerous benefits, and the top four are listed below:
Reduce tax liabilities
Accountants who specialise in helping small businesses process their taxes can advise on how you can lessen your tax liabilities. They have access to information about deductions and credits you had yet to learn about, adjustments in business structure, and incentives from the Australian government, like the R&D tax incentive.
Organise your payroll
When managing employees, you are also constantly dealing with the payroll. You must also understand obligations like tax withheld, due dates, and superannuation.
However, Australian tax policies undergo many changes quite often. The complex nature of the Australian tax system can make the payroll a laborious element to deal with. Hiring a small business accountant will mean you can trust that your payrolls are organised.
They will set up and run your payroll, following the schedule you’ve discussed. Your employees will receive their payslips through email or on paper. They’ll make sure all calculations are accurate and done on time. Additionally, they’ll help you register a pension scheme for your employees.
Identify the proper business structure
Failure to declare the correct business structure can result in penalties by the Australian Tax Office. Consulting with a skilled consultant can help you determine the proper business structure so that you can report taxes correctly.
Aside from tax reports, the business structure is highly significant to increase earnings and maintain cash flow. Accountants create suggestions on how to improve income and reduce risk by assessing operating expenses.
Gathering accurate information and evaluating if you use the appropriate business structure is possible.
Achieve your long-term goals
Expert accountants play a pivotal part in helping you achieve your long-term goals by identifying market opportunities that can push your startup’s growth.
They help you keep track of your money coming in and going out, so you can see if you run into money problems ahead of time. Also, accountants make reports about your finances and update your spending plans. This helps you avoid spending money where you don’t need to, understand possible problems, and fix things if they go wrong.
Conclusion
The journey of small business growth is akin to transforming a caterpillar into a butterfly – a process that demands adaptation, perseverance, and a strategic approach. The landscape of the business world is dynamic, and as revealed by the Australian market trends, achieving and sustaining growth requires careful consideration of several vital aspects.
In the ever-changing realm of entrepreneurship, the steps enumerated in this blog article serve as a roadmap for small business owners seeking to transition from the early stages of development to a flourishing entity. Aside from implementing the aforementioned steps, remember that financial health is critical.
Small business accounting emerges as a guiding compass in navigating the complex economic landscape. From managing cash flow to optimising tax strategies, accountants play a pivotal role in ensuring your business’s stability and sustainable growth. They provide invaluable insights, enabling you to make financially sound choices that transform your dreams into a reality.
As you undertake this life-changing entrepreneurial adventure, remember that growth is not a linear path; it is an ongoing process that requires adaptation, resilience, and a commitment to continuous improvement. By embracing change, harnessing the power of community and technology, and maintaining financial prudence, your small business can spread its wings and soar to new heights.
Source:
https://blog.azuregroup.com.au/10-benefits-of-engaging-an-accounting-firm-for-your-small-business
https://perthmobiletax.com.au/why-do-i-need-an-accountant-for-my-small-business/
https://www.afr.com/technology/behind-australia-s-new-small-business-boom-20220420-p5aeoc
https://www.ausbanking.org.au/small-business/
https://accentis.com.au/blog/understanding-australian-payroll-basics/
