Few businesses can function without some support from third parties, whether they be accountants, lawyers, marketing consultants or non-executive directors and mentors.
As well as their professional expertise and experience, they can also offer a different perspective on a business and bring ideas for a fresh approach. Used wisely, third parties can plenty of benefits, but the relationship company owners have with their external, or internal, advisers may not always be a happy one.
The Entrepreneurs' Forum recently hosted the latest event in its panel sessions, with four members sharing their knowledge with guests who were keen to avoid the pitfalls and gain from the positive experiences.
Chaired by Jeff Grout, the panel comprised Tom Maxfield, former sales director of Sage and founder of Tom's Companies, who spoke about PR and advertising; Jamie Greenwood, managing director of NJL Yorkline in Gosforth; Sam Colquhoun, founder of Right Hand HR, a leading provider of outsourced human resources services based in Newcastle, and Brian Dougherty, of Prudhoe medicine manufacturer The Specials Laboratory, who explained the relationship he has with his executive coach/business consultant and the value it brings to his business.
Their top tips for working with third parties is as follows:
1. Size does matter - Whether it's lawyers or accountants, choose the right size firm for your business; as a start-up you may not get the treatment you demand from a larger firm, and the costs will be higher. It's also important to recognise when your business has outgrown your third parties and that the time may come when you need to change them.
2. Find a good fit - Make sure you choose third parties who are in tune with your business, who are also entrepreneurial and who you get on with. Make sure your brief is clear and that you get the appropriate specialist in their firm.
3. Raising finance - If you need grants to get you started, you will need to do some groundwork first. Applying can be a humiliating process and it may be months or years before you finally see some money. In some cases, having experience and background in your field, commercial awareness and some finance behind you may actually work against your grant application. Do your research before you begin.
4. Your business plan is key - With a high-quality business plan, traditional lenders will support you if they can. If you've produced a well thought-out, well researched business plan supported by the right documentation and your request is still turned down, find out why. You will have learned something for next time.
5. To market, to market - Have clear ideas about your market and the benefits you bring to it then find an agency that is tune with you. Spend more than you think is reasonable, spend even twice as much on building and marketing your brand - it will survive longer than your individual products.
6. Create a culture - Third parties can provide valuable support in building the culture of your business through the attitudes and actions of your people, and the type of people you recruit. They can also bring objectivity through programmes like Investors in People and to training. The right expertise for the job may not always be within.
7. Non-executive directors - They need to be people who can bring something different to your business, with or without direct experience of your sector. Good non-execs will prod, push, challenge and ask why. They bring an objective viewpoint and can cut a swathe through the detail with a pragmatic approach. Mature, experienced non-execs can be a great asset to fledgling businesses.
For more information on the Entrepreneurs' Forum, tel: 0870 850 2233 or visit www.entrepreneursforum.net
