Changes to Ontario’s workplace laws have been the source of fury for many small business owners recently. As of January 1st, the province’s minimum wage increased to $14 per hour—up from $11.60—with an additional dollar increase due in 2019. A lot of small business owners seem to view this increase as a hit to their bottom line, with many grappling with the idea of raising prices, or cutting staff in order to balance the books.
Here’s the reality, folks—whether it be a rise in labour costs, or a rise in interest rates, your business will likely be affected. The important thing to remember is that there are always opportunities to get the value you’ve worked so hard for back.
Here are three ways small business owners can embrace the minimum wage increase:
- Account for rising labour costs in your long-term business planning
If the recent business headlines are any indication, a lot of small business owners have contemplated cutting back on benefits, hours, or even resorting to layoffs to make up for the changes to minimum wage. But let’s keep in mind that, in adjusted dollars, the national average minimum wage isn’t much higher than in the 1970s.
By accounting for rising labour costs in your long-term financial planning, you’ll have the opportunity to make small adjustments to your operations year-over-year—so, when a bump in minimum wage comes along, it won’t feel as big. If a restaurant business were to increase each menu item by 25 cents, they could cover the additional cost of labour without making a drastic change that would turn customers away.
- Focus on boosting productivity
One of the great things about change is that it forces us to take a good look at whether what we are doing is working to our advantage. Instead of looking at the minimum wage increase as an added cost, why not look at how your team can better manage their time to be more productive. Maybe that means adding new performance indicators for sales, or starting a new recognition program to motivate your employees.
- Prioritize your greatest strength: Loyal employees
Minimum wage is the cost of effort—your employees deserve to be compensated for their hard work. Try to find ways of cutting cost without jeopardizing employee incentives, like benefit programs or working hours. Think of it this way: the less staff turnover you have in your business means less money spent on hiring and training. If you treat your staff members right, they will be willing to work even harder for your business, which is priceless.
Do you still have concerns about the minimum wage increase affecting the value of your business? The Blue Sky team is here to help you put a plan into place to grow the value of your business. Call us today to get started: (289) 466-5210.
Goal setting is one of the most powerful tools in a small business owner’s tool belt. This practice not only helps you see where your business is today, but puts into perspective where you thought you might be. It helps identify strengths and weaknesses. It helps push us forward and spark new, innovative ideas.
The majority of Canadian small business owners expect 2018 to be a good year, with more than half anticipating increased revenue over the next 12 months. But, in order to build momentum towards that success, it’s important to set specific, measurable goals for your business.
Here are four goals every small business owner should build off of this year:
- Be “SMART” about your goal setting.
SMART is an acronym for specific, measurable, action-oriented, realistic, and time-based goals—a simple planning framework designed to help you create more actionable goals. For example, a common business goal is, “I want to make more money.” It’s a great goal, but it’s far too vague. How much more money do you want to make? How will you accomplish that? And by when?
- Find a way to hold yourself accountable.
Accountants are all about accountability. Our job is to help your business answer to its performance and help you see where you’re at in terms of reaching those goals. Long term, we can help you see what you have done relevant to the goals you had in years past.
- Be more adaptable.
I can’t stress enough how important it is for business owners to accept change, rather than be fearful of it. Whether it be an increase in minimum wage, or trends within your particular industry, change is often out of our hands—it’s all about how you deal with it!
- Plan for the future.
In my experience, most business owners aren’t doing enough to plan for the future. It’s important to think long term, yes, but it’s the short-term goals that will take you closer to that direction.
If you’d like help coming up with measurable goals for your small business the Blue Sky team is here for you. Let’s get to work and make 2018 your most successful year yet: 289-466-5210.
Small business owners have always known the importance of fostering community. In the last few years, however, ‘community engagement’ has come to mean managing your online relationships. In my final blog post of 2017, I want to talk about engaging your local community – the people whose homes you build or the customers who walk into your store every day.
If there was one word I could use to sum up the advice I’ve shared over the year, it would be connection. I’ve talked about connecting with other small business owners, connecting with employees, and connecting with your own dreams and ambitions. Here are a few tips for engaging and connecting with your real-life community-at-large:
- Engagement must be sustainable.
When it comes to community initiatives, people are often tempted to go for the low-hanging fruit. They try to grab publicity at a high profile event with a sponsorship or a billboard. However, when the big event is over, so is your business’s involvement.
The key to a long-term, symbiotic relationship is choosing a partner you like, whose values align with your own. For example, at Blue Sky, we support Shadowpath Theatre because of the incredible work they do making the arts more accessible to the community.
- Community must be built, not bought.
It’s important for small business owners to understand that they help build the community and then the community helps build their business. Your choice of how to engage should benefit the community, bolstering it and making it stronger.
Instead of dropping off a cheque for $100 at the local food bank, ask employees to bring canned goods to the annual Christmas party. Becoming a real part of the community requires helping to create a stronger foundation to support that community. In the long run, people will treat your business the same way.
- Share your achievements.
Share the story of what you support in your networking, with your customers, and your clients. Make people proud to say they hired you/shop at your store/buy your products!
When you truly believe in what you’re involved in, it’ll be easy to highlight what you’ve done for the community in a personal way. This will help you build connections and strengthen relationships – leading to more opportunities to foster new ones.
Becoming a part of the local community isn’t something you just throw money it. You have to get involved with an organization that is offering a valuable service to your community and support it in a perpetual, committed fashion.
Need help figuring out how community outreach fits into your business plan? Give us a call today at 289-466-5210 – we never charge to chat.
Succession planning isn’t the most glamorous topic to think about—it certainly takes the wind out of the young!
The end of your involvement in a business is a reality of starting one, so succession planning is something to start thinking about early on. Well begun is half done! Here are six things you need to know about succession planning for your small business:
- Recognize the necessity of succession.
Start a business with the knowledge that you won’t always be able to run it. Every business owner should anticipate when that time will come and figure out what might be possible at that time—whether that means selling or passing it on.
- Anticipate capital gains tax.
If you make a profit on your investment when you sell the business, you will have capital gains that will be subject to taxation. There are special exemptions for small business owners but you must meet certain criteria. It’s best to start discussing this with your accountant prior to moving on from your business.
- Figure out how to let go.
If you’ve decided to sell, understand that you can’t sell your business if it’s dependent on your presence to function. You need to find out what your employees can’t handle on their own and then sort out how to fix it before putting your business on the market.
I always suggest my clients take a long trip away—one they’ve always dreamed of—and designate one employee to make a note of everything they couldn’t manage without you. Once you’ve created systems for everything on that list, you’ll ensure the business is in optimal shape.
- Sort out any personal problems.
A new business owner doesn’t want to inherit problems they didn’t create and don’t have the means to solve. If there are any issues hanging around that are specific to you—such as outstanding loans to family members or asset ownership—make sure all of these are solved before you hand the business over.
- Build a good financial record.
A smart business person will want to see at least three years of good financial statements before taking on your company. That means you should be working with a skilled accountant at least five years before you plan to sell. They’ll help you go through your books, clean up financial irregularities, and create an efficient accounting system.
- Avoid sentimentality.
Recognize that what got your business to where it is may not be enough to take it to where it could be. The person who buys your business may reorient your business or the style in a way that suits their skill set, attitude, or the current market.
I always explain to my clients that selling a business is like selling a house: people don’t want to buy your home, they want to buy a structure and make it their home. And just like real estate, selling a business requires staging—making the business as attractive as possible. Blue Sky can help you do that – just give us a call: 289-466-5210.