Is Your Business too Dependent on you? Here are 5 Warning Signs to Look out for

As business owners, ask yourselves this: what is your role in the business? Are you taking up one or two roles? Or as an owner, you’re filling the shoes of three or more roles or positions in your business?

When a business is too dependent on the owner, the chances of it surviving in the case of a long absence is very slim. Besides the increased risks when the business is very dependent on the owner, it’s also very suffocating for the business owner and can hinder a lot of growth opportunities for the business.

Another problem owners can face if the business is dependent on them is how acquisition is made difficult. Investors and buyers often shy away from businesses that are dependent on the owners knowing the dangers of buying a company that heavily relies on the owner for its operations.

Whether it’s longevity or acquisition, it’s important for business owners to structure their business in a way that it’s not too dependent on them and can function even in their absence or exit in the future. While this is the ideal scenario, some business owners can easily overlook or miss out the signs.

Here are 5 warning signs to look out for:

1. You are the only signing authority of your business

While it’s common for business owners to be the “final” authority to sign documents and make it official, what happens if they’re unexpectedly away for days, months, or maybe even years? Does everything stop during your absence?

It’s important for business owners to have a “trustee” in their organisation to sign documents on their behalf. Consider sharing privileges and signing power as this simple gesture can easily save your business from trouble during your absence.

2. Your revenue is flat when compared to last year’s

When your revenue is flat compared to last year’s, this could be a sign that you are a hub in a hub-and-spoke model. Even if you want to push more or generate more revenue, a business owner, no matter how skilled, can only work within their capacity. Even if you are efficient and put in all your hours in the business, there is no guarantee that you can extend outside of your capacity.

A simple “fix” for this is to push products that does not require personal involvement. Narrow down product/service offers selling fewer things to more people. 

3. Your vacations do not feel like vacations 

Do you find yourself still on your phone, tablet, or laptop even on vacations? Or is your mind not present on the vacation destination but rather on your business and you spend the bulk of your “vacation” worrying about your business?

This is an obvious sign that your business is dependent on you. While we understand that business owners can get very dedicated to their business, there is also a point where it’s unhealthy both for the owner and the business.

Try taking a day-off and measure how your business performed during that day. Did it still maintain operations or did your absence impact the operations? If your absence impacts your day-to-day operations, then it’s time to build a structure and system that keeps your business functioning even in your absence so you can allow yourself and the business to thrive even when you’re on days-off, vacations, or emergency leaves.

4. You know all of your customers by their first names 

While it’s good to know your market and customers, being the glue that sticks together your business and your market isn’t exactly a good sign. If your business’s market relies heavily on their personal relationship with you as a business owner, then chances are your business won’t survive in your absence.

A good way to turn this around is to build a strong sales team that’s highly trained so they can manage the sales aspect of your business. This will save you and your business in the future as your sales can sustain itself even without your supervision creating growth opportunities for your business. 

5. You get cc’d in more than five e-mails in a day

As your business grows, your email inbox would probably be popping with business emails left and right. 

If your team constantly cc’s you in emails, it can be a sign that the people involved need your approval in every action. This means that in your absence, some of the activity can be put on hold and this isn’t exactly a good thing. 

Delegate tasks and build your team to be independent in running the business while only involving yourself in emails that actually need your presence.

business coach
Hi, I am Felicia

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