A new survey from small business platform, Xero has uncovered some of the most common lessons and learnings shared by small business owners.
The Do Better Business survey of small business owners found 83% made costly mistakes with hiring the wrong staff and working for free (22%) followed by working with the wrong partners, suppliers and investors (18%) and working with family and friends (12%). In addition, two-thirds (66%) were discouraged by friends and family from starting their own business in the first place, while one in five (20%) admitted to missing a significant life milestone like the birth of a child or wedding in the early days of their business.
Close to three-quarters (73%) rate strong financial management practices in the top three most important priorities they believe small businesses just starting up should focus on, with 92% saying that they have implemented financial management practices that have had a positive impact towards their business.
Xero Australia country manager, Will Buckley (pictured below) said, “We know running a small business comes with challenges, particularly as you have to wear many hats. The good news is that there are a range of options open to business owners that can go a long way in easing some of the pressures of day-to-day operations.
“Firstly, by utilising cloud accounting software, retailers can better monitor their cashflow and oversee their finances in real time. Connecting this software to an inventory management app, powered by AI, can also help to accurately track and forecast inventory levels so you can avoid running out of stock or having too much.
“Alongside this, we’d recommend any small business owner work with an accountant or bookkeeper and meet with them on a regular basis. Advisors not only help you with tax and reporting obligations, they also support you on a range of things including addressing growth aspirations and finding the right tech to run your business.”
Cullen Jewellery owner, Jordan Cullen said the greatest lessons he’s learnt as a business owner are to never be complacent due to constant market changes and finding ways to turn negatives into positives.
“For example, when we started, we were a small player and had to spend more on marketing and innovative technologies to compete with bigger, more financially robust jewellers. It was a bit of an uphill battle at first, but this eventually helped set us apart from other jewellers who rested on their laurels and didn’t have the same pressure to innovate,” he said.
As for his advice for other small business owners: invest time in learning hard skills instead of soft skills.
“These are the concrete, teachable abilities directly related to the work you want to do, with soft skills important but often best learned on the job. Second, have a robust hiring strategy from the start. We made some subpar hiring decisions early on that could have been avoided with a clear plan. Look for a balance of skills and cultural fit.”