Home – New Forums Starting your journey A Few Questions about Employees, Buying Property

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  • #973225
    motrellik
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    • Total posts: 5
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    Hi guys,

    I am a self taught Web Designer & Developer from Melbourne who is passionate about art and design. My business TRC-Designs was established a few years ago and have recently had increasingly stronger cliental throughtout the past few months. People are finding my business through ‘word-of-mouth’ so to speak, and through my website. I have a few questions that have regarding the expansion of my business.

    I would like to know firstly when I should begin to look for property and hire employees. What comes first? How do I know when the time is right? Do I need a lot of money saved?

    I would like to know what the easiest way would be to go about all this, or if I should go down this path at all?

    I need some direction on how I should proceed with all this.

    Anyone who can offer some advice would be greatly appreciated.

    Thanks in advance,

    Tom

    #1060489
    Spider
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    Hi Tom,

    Looks like things are going well for you.
    We were in your position a few years ago.

    The move out of home to a bigger place happened first for us, as we deal with physical products.
    However, after that came employees.

    When we moved to bigger premises, it was just my wife and myself working, and it was very hard work.
    Was killing myself badly, but profits were good for a biz only a year old, was netting close to 500k (after taxes).

    It came to a point where I could keep killing myself for another couple of years and burn out, but make another mil or so, or get employees, which I really didn’t want to do as I really didn’t know how they would go and it was all new to me.

    We did end up getting 1 employee to help with the physical work, and then got another a year or so later to help with the office stuff.
    Now we make about 1 mil per year (salaries and profit after tax).
    Will probably go another 2 years with this biz then rest a while and do something else.

    The main factor which helped out business and pushed us to get employees was – Business Coaching.
    It was expensive at the time, $2000/month for a weekly visit, but it worked, which is all that matters.
    Had it for about 12 months, was going over the same stuff after a while, but the initial meetings definitely put us in the right direction.
    You can get cheaper business coaching, and I highly recommend it.
    1 on 1 coaching is just different to other forms of learning.
    Good business coaches who work in networks can help your business based on the methods used by other similar businesses to become sucessful.

    Good Luck

    #1060490
    CruzAccountant
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    Hi Tom

    Welcome to the forums! I’m sure you’ll find lots of useful information here, and people willing to share their experiences.

    Simple answer to your question is look at your cashflow, and assess that against your mid to long term goals. Best to work out the numbers and see if the business is sustaining they repayments on a loan.

    Many people struggle with handing control over to another person (employee), so this is a HUGE step from being a micro business to a small business. Just make sure you have your systems and processes in place to monitor the employees performance.

    Best of luck!

    #1060491
    motrellik
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    Hi guys,

    Thanks for sharing your thoughts and experience.
    I will check out the business coaching in the future.

    As for now, I have the opportunity to outsource big projects to 3rd party companies cheaply, however I do realise this will become short lasting and is only a temporary solution.

    Of course building a company from the ground up is not an easy thing to do, and I just can’t imagine ‘outsourcing’ work for the next few years without the business growing considerably.

    And yes my main concern will ultimately be the work load and how much cash I will be earning, I will just have to work out if it is a necessary step to take in order to carry on the success of the company.

    Were there any problems you had to face when purchasing property or with your employees Spider?

    Tom

    #1060492
    Spider
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    Hi Tom,

    Why do you feel the need to purchase property for your business?
    Leasing would be a better option when starting out.

    #1060493
    motrellik
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    Spider, post: 74792 wrote:
    Hi Tom,

    Why do you feel the need to purchase property for your business?
    Leasing would be a better option when starting out.

    Well I am relatively new to all this, I wasn’t sure about that and I’m still learning how to go about these things. I’m young and ambitious though and a fast learner.

    #1060494
    Alan Maddick
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    I would lease for sure, i am not normally a fan of buying property for your business the reason being businesses can and do change rapidly. In our business we leased a premises that seemed way too big for us on a 5 year lease and grew out of it in 2 years!

    There are some exceptions to this such as doctors, butchers all the businesses where you location is very important, you still may lease in this case but could look at buying as it’s more likely you will be there for a long time.

    Also i am a big advocate of businesses funding themselves ie your business should be able to pay it’s own rent. It shouldn’t have to look to you the owner to use your cash and or equity to buy premises for it.

    Oh and Employees cause lots of problems!! But they are also the only way to get real leverage in a service based business like yours.

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