Many entrepreneurs get professional advice to help start their business and with various aspects of their day-to-day operations. These services often come at a high price, so how does one know if it's really necessary?
When starting your business, there are certain occasions when it's advisable to get professional advice. A lawyer, for example, can explain the conditions of your loan agreements, contracts and leases.
On the other hand, entrepreneurs are at times so intimidated by certain processes that they hire professionals when they can actually do it themselves. So how do you know when it's best to call in an expert and when it's okay to do it yourself?
Call in an expert or DIY?
Entrepreneurs are often expected to be a 'jack-of-all-trades', but none of us are experts at absolutely everything. To make an informed decision about where you need an outside opinion, it's good to understand what the various professionals do:
- An accountant: sets up your books and financial processes, prepares your tax returns and gives tax-related advice. Use someone with SME experience or insight into your specific industry
- A lawyer: can help you choose the right business format, file the associated documents, advise you on labour laws or issues, look at contracts and represent you in any legal actions you may face
- A business banker: helps you get financing, establish your company's banking accounts and (at banks with small business divisions), they can even provide operational advice
- Insurance consultants: evaluates your insurance needs and advises you on what coverage you need. It's important that this person works with small businesses, so all your bases are covered
- Management and marketing gurus: provide basic business operational advice, pricing and inventory guidelines, sales and advertising strategy. Franchisors often make this a proviso for their franchisees
- A mentor: having a mentor who is an expert in a certain area or an all-round small business fundi can be one way of getting that professional opinion, while learning to do it yourself in the future. Their services can be a lot cheaper, as many business people do this to empower entrepreneurs rather than make a profit
- IT experts: outsourcing your IT can help you implement the best electronic systems for your business. Whether it's setting up your networks, designing a website or managing your IT security, there are many consultants to choose from at competitive prices
Once you've identified your needs, evaluate your own knowledge and abilities in these areas, combined with the needs of your business. You may have enough bookkeeping know-how to do your own books and can use the advice offered by the Receiver of Revenue to do your taxes, for instance.
Look at your business plan and what your short and long-term goals are. This will also give you an idea of which suggestions you'll take and what's not relevant to your company.
Finding the right person
The next step is set about finding the best advisors. Ask colleagues for referrals, do an Internet search or call your local business chamber to find out if they endorse any professionals in your area. These associations sometimes offer certain services for free or at a discounted rate to their members.
It's worth mentioning that small business owners often make the mistake of hiring family or friends, either to save money or to help them out. This can backfire for a number of reasons, so stick with outside professionals who can be objective and provide certain guarantees.
Yes, there are times when getting experts to do certain jobs is best. But make sure you've done your research to see whether it's not something you can do yourself and then make an effort to find an experienced and trustworthy individual. A little background knowledge will also help you to make the best use of the time you're paying for.
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