The benefits of financial training for business owners

The importance of training for small business owners

Latest research indicates that 20% of startups will fail in the first year and 60% won’t succeed past year three, startling figures that would put many people off trying in the first place but business owners are brave at heart. A lack of financial management knowledge is often quoted as one of the main reasons why businesses fail and with that in mind it is essential that business owners equip themselves with the knowledge and skills required to boost their chances of success.

It is understandable that when budding entrepreneurs follow their dreams of starting a business they get swept along with excitement of it all and are consumed by the amount of work that is needed just to get the business up and running. They haven’t got the resources to recruit experienced managers to cover key business operations and therefore, nulltake everything onboard themselves, learning as they go along. They have to become a sales and marketing guru, a HR manager, a financial consultant and much more. 

This may be OK in the early days but it is not sustainable over the long term and it is crucial that they gain the necessary knowledge and skills in key areas, especially in finance and management. Because of the time and financial constraints facing business owners the most effective way of acquiring knowledge about any business discipline is through training. Owners can identify gaps in their knowledge and seek training through a method and at a time that is convenient for them.

The benefits of training

The main purpose of training is to upskill an individual and provides a raft of generic advantages and transferable skills. When you specifically target training aimed at business owners then the following are just some of the benefits:

  • Develop effective leadership skills
  • Gain a deeper understanding of running a business
  • Helps resolve challenges facing specific areas of the business
  • Improves decision making
  • Enhances communication skills
  • Increases productivity
  • Helps to gain an understanding of how to grow a business
  • Identifies opportunities

Regardless of the business sector an SME operates in there are common challenges they all face. Examples of these include the following:

Understanding cashflow

Poor cash flow management or a lack of understanding of cashflow is by far the highest reason of business failure. Even Phil Knight in the early years of launching Nike struggled with cash flow, which almost saw the world’s biggest sports brand fail to get out of the blocks.

Unable to grow a business

Many SMEs successfully manage the early years but are stuck in a rut and are unable to grow. Training in this are enables owners to grow their business and reap the rewards that come with it.

Customer attrition and acquisition

Retaining existing customers and acquiring new ones is a sure-fire recipe for success, but if only it was that easy.

Failing to optimise business performance

By conducting a gap analysis businesses owners can identify which areas are underperforming, identify problems and resolve them. It can also help a business launch new products, enter new markets and along with KPIs can maximise revenue opportunities.null

Strategic planning

Unclear objectives or a lack of direction can and often does result in businesses stagnating and eventually failing.

Exit planning

A large percentage of small businesses are not saleable even though their owners think they are. Alarmingly, only a small number of those that do sell, reach their asking price.

This is by no means a comprehensive list of the obstacles that business owners have to overcome but they are some of the most common and important.

There is an abundance of training providers available providing different levels of training, covering all aspects of running a business. Whether you are a novice in a certain area or just want to brush up on specific skills then training really does deliver. To find out more about please click here.