Every entrepreneur dreams of having a eureka moment – their one-in-a-million spark of an idea for a small business that will change the world. But for many, a turning point is when they first realise that their flicker of inspiration has become a real, viable enterprise.
We asked small business owners when this realisation hit them and the changes that they subsequently made to ensure their organisation sustained that success.
Implementing a business plan
For Alex Miles, co-founder and director of Quiet Rebellion, a purveyor of quirky socks, it was when he and his business partner first put together a proper business plan after six months of trading that they grasped that their vision had become reality.
Miles says it crystallised their ambitions, adding: “We then started talking to investors and realised we had a real business with a proven track record, a vision that people bought into and a clear strategy on how to get there.”
Professionalising the business meant making some administration changes, drawing up contracts and recognising the parts of the business where they needed outsourced help. “Our finances moved from spreadsheets to accounting software, informal relationships with manufacturers were replaced with service line agreements and, crucially, packaging and fulfilment moved from a bedroom operation to an outsourced specialist company.”
Opening a business account
As part of this journey, Quiet Rebellion also transitioned from managing their finances via a personal bank account to a business account after about four months of trading. Miles says that having all the company finances coming into and out of the same account has made tracking income and expenses, and subsequently their working lives, easier.
Many companies find their banking needs change as they grow. Up to 90% of SMEs get their business loans from the banks where they have their current account, even if it’s not the right choice for their business long term. If it is time to move on, switching accounts is easy with the Current Account Switch Service, whereby account holders just need to decide on a new account and the date that would suit them to switch. All Direct Debits and standing orders are then transferred by the new bank, and any payments that are sent to the old account are automatically redirected during and after the switch.
Investing in professional equipment
Founder of ice cream sandwich business Blu Top, Richard Makin, realised his business idea had legs after he made a substantial investment in a huge piece of commercial equipment. His business idea had struck him after spending time in San Francisco, in the middle of a foodie pop-up revolution. When he got back in the UK, he went about recreating the ice cream sandwiches he’d seen there and studied how how to be an artisan ice cream maker. After humble beginnings at home, the orders kept coming and Makin took the leap to expand.
“I’d been trading for a few months, making ice cream from home in domestic ice cream machines, but demand had grown rapidly. I realised I needed a commercial machine and purchased a countertop batch freezer, assuming it would fit on my kitchen table. When it arrived it was so large that I had to call two friends to help me carry it up to my first floor flat.”
He adds: “I sat on the edge of my bed, staring at this enormous, sickeningly expensive piece of equipment and realised this was the real deal.”
While Makin had been a little apprehensive about running his own business initially, his investment made him realise it was all or nothing. His ice-cream cookie sandwiches are now sold from a Blu Top van at markets and festivals all over London, and Makin was recently a finalist in the 2015 Young Foodies Awards.
Landing a major client
Thanks to the chatter on social media and favourable press coverage on Buzzfeed and in the Financial Times, there was excitement around sourdough doughnut business Crosstown Doughnuts, from the start. But JP Then, one of the co-founders, says it was landing a number of key wholesale accounts within the first month that made him realise their idea had become a real business.
“Selfridges contacted us in our second week of trade. It was quite unexpected given they are most well-known for their fashion rather than food, but being the number one department store in the world, it was a welcome tick of approval,” he says.
Unexpectedly, they were also approached by Air New Zealand soon after. “We supply them with mini doughnuts for their business class and premium economy passengers for flights from London to LA daily. It’s a route to market we never expected but it highlighted that our business model could extend beyond retail and wholesale.”
Crosstown Doughnuts was still only operating as a market stall at the time so, as Then says, it was a unique position for them to be working with global brands and every day customers on the streets. It shows how investing in good PR and a strong social media strategy, can launch a new business to early success and catch the interest of potential clients – even those outside of the UK.
Being thrown in the deep end – and swimming
During the first three months of co-founder Thom Elliot’s business, Pizza Pilgrims, he was still working a normal job and going to Berwick Street market five days a week to sell pizza in his lunch hour.
Then something unexpected happened. “One day – someone came up to us to ask if we wanted to sell pizzas at V Festival for a weekend,” says Elliot. “We managed to assemble a team of mates to help us and it was gloriously hot so we sold a fair few pizzas. It was that weekend – taking on a massive project and pulling it off – that made me realise it could work longer term. I handed in my notice at work that week.”
Elliot and his business partner, his brother James, relentlessly accepted every opportunity they could get from the start, without considering if they had the means to take them on.
“You always have the ability, it’s just about taking the leap,” he says, encouraging other small business owners to take a chance when opportunity knocks. Pizza Pilgrims didn’t have much time in their first year to take stock and try to actively grow the business, Elliot explains – it just happened naturally. They now have three pizzerias in London.
How to ensure success beyond the “eureka” moment
Parag Prasad, managing director and founder of London Business Coaching, says there are many factors that can stop entrepreneurs from being able to take their business to the next level.
Sometimes, the owners are too comfortable operating as technicians as opposed to focusing on the big issues. “They’re still doing the work that their operational people should be doing, rather than transitioning to an entrepreneur’s mindset where mastery of the key fundamentals is paramount: time, delivery and finances.”
Prasad adds: “A clear vision provides energy and direction for the whole business. Clarity of vision will engage and inspire the people who work with you, making them feel like they’re contributing towards it, rather than just turning up for a wage.”
To maintain momentum Prasad also advises regularly reviewing your business’s performance against its goals, prioritising the constant improvement of skills among your team, creating a positive company culture, and building systems to optimise cashflow. Part of this might be regularly evaluating your business account needs and using the easy to use (and free) Current Account Switch Service to move across to a new provider, if you’re unhappy with your current bank.
Content on this page is paid for and produced to a brief agreed with Current Account Switch Service, sponsor of the Managing your cashflow hub on the Guardian Small Business Network.
