smallbusiness.co.uk: Helping your business think big

With the UK economy continuing to increase faster than anticipated following the sixth consecutive quarter of above-average growth, chances are that further interest rate rises will follow in an attempt to rein in inflation.

For businesses, this outcome is something of a double-edged sword. Low inflation keeps costs down, but increasing interest rates means that business borrowers are hit. Often, it’s the early-stage companies that are hit hardest.

SmallBusiness.co.uk has these tips from Simon Cowie, head of the corporate finance and business advisory team at Hall Morrice chartered accountants, who believes that business success is achieved thanks to the individual actions of companies, rather than due to the nature of the market.

‘A strong or weak economy is simply a general trend across the nation – it doesn’t necessarily mean that all businesses’ growth follows these patterns. How your company develops is just as much dependent on internal influences as it is on external forces,’ says Cowie.

‘In business, it's easy to become too comfortable. There is a reassuring sense of familiarity in doing things the way you have always done them, but this is not always the best approach to take. Variation and adaptation are an essential part of a thriving business.’ Follow these five tips to avoid complacency:

Embrace new technology - Naturally this will require an investment in order to be implemented effectively, in terms of both time and money, but it can often make the business more efficient in the medium- to long-term.

It is important, however, that you ensure that the burden of work is not just passed on elsewhere within the organisation. Make sure you choose the right solution for your needs.

Look for new blood - New employees are essential to ensure that the business continues to thrive, because additional staff members bring with them different perspectives, techniques and approaches to doing business. Don't look for people that are just going to be happy to keep their head down and always go with the flow. Look for employees with the potential to contribute instead.

Combine your strength - A merger or acquisition is also a great way to boost the prospects of the business. Merging with or taking over an organisation that you feel can add value to your business is a great way to drive the company forward, because you also acquire knowledge along with the more tangible assets. You could target a competitor to increase your market share and consolidate your position or pursue a company with a markedly different product or service that will add to the company's portfolio.

Explore new avenues - Diversification can often be crucial to the future success of an enterprise, especially once you have developed both your product and its market to their limits. This can take three distinct forms: introducing a product or service which complements your existing offering but will appeal to new markets; something different that may appeal to your current customer base; or something new designed specifically for an entirely new market.’

Be brave - All too often in business it's easy to forget how to be brave and take chances, but that's exactly what can make the difference between standing still and moving forward. Starting up is a daunting step to take, yet once that has been accomplished that entrepreneurial attitude can often be quickly forgotten. Don't ever lose sight of that spirit, because that is what could make the difference between a company which is going places and one which is going nowhere.

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