Partner Article

Four secrets to smashing the £1 million turnover barrier  

Many business owners understandably become frustrated by their failure to achieve the often elusive £1m turnover.

Over the course of the years I’ve learnt some powerful - and often painful - lessons which I’ve injected into growing Advanced Digital Dynamics from a £300k to a £3.4m turnover.

Success and perseverance centred on four key areas – processes, people, profitability and innovation – areas which continue to be critical to our dynamic and ambitious growth plan.

Compared to the corporate world, where retail giants such as Burtons and Asda shaped my early career, small and medium sized businesses face different challenges - which invariably include the top people being sucked into business minutiae instead of working ‘on’ it and keeping the bigger picture.

My corporate experience of implementing and sustaining robust business and recruitment processes enabled us to bypass many growing pains which SMEs undergo in breaking the £250, £500k, £750k and £1million barriers.

Growth is invariably hampered by lack of processes and fatal mistakes can happen if MDs have all the information required to run the business in their heads.

What would happen to the company if you, as the boss, had an accident? Would your employees know all the necessary systems and processes to ‘hold the fort’ in your absence? How long would the business last before the wheels rattled - or even fell off?

Start now and systemise your business so that anyone coming into it can refer to a ‘How To’ manual – ensuring everyone is working in uniformity.

Finding and retaining good people with a positive ‘can do’ attitude who will take ownership and responsibility is also paramount to reaching a £1m turnover. My first major decision when I joined ADD eight years ago was to release two employees who were adding no value and recruit ambitious people who wanted to be part of an exciting journey with great career progression.

Many bosses are guilty of hanging onto the wrong people for too long in the hope that they will improve. They invariably never do: the sooner you address this issue, the closer you will be to achieving your growth goals.

When it comes to the figures, chasing turnover is pointless. Your focus should remain on being profitable. Resign unprofitable accounts and turn down work with little or no margins. At ADD we work on profit margins of 30- 35 per cent, enabling us to invest in the business in order to keep striving forward.

Finally, keep innovating - irrespective of whether you are a product or service based enterprise. Innovation is the lifeblood of SMEs and continues to drive our growth into critical areas such as data destruction where we are building a strong reputation. Adapting and changing to the marketplace is critical to flourish – and leapfrog your competitors.

This was posted in Bdaily's Members' News section by Julie Pickersgill .