If you’re a sole proprietor, you’ve taken your first step to be successful in business. Over 23 million sole proprietors operate in the U.S., but if you want to take the next step in growing your company, it’s time to become a business owner.
What do I mean by that?
There’s a difference between being on your own and being the CEO of a business with a team you can rely on. If you haven’t made the transition yet or are having doubts that this is the right choice for you, I’ll explain the “why” and then how to make the transition if you’re still interested.
Why Should You Make the Transition from Sole Proprietor to Business Owner?
Remaining a sole proprietor is an option that you have, and it’s often the easier option at first. If you’re used to being a one-person operation and it pays the bills, it sounds like a lot of work to hire and manage others.
But think about the downsides of staying a sole proprietor:
- If you’ve ever tried to take off work, you know that you still have responsibilities even when you’re on vacation.
- On the subject of vacation, when you’re not working, you’re not making money.
- Without someone to fill in your shoes, there’s a risk that customers may leave because they are fully dependent on one person – you.
- And what would happen to your business if you had a serious family or health issue and were out of commission for several months?
Shifting to a true business with employees requires a mindset shift, but imagine what your business will look like with additional support. Yes, hiring and managing takes work, but your business will be less reliant on you in the long term, making it more stable and more valuable.
So, how can you make the shift from sole proprietor to business owner?
How to Go From Sole Proprietor to Business Owner
If you’re ready to go from owner-operator to CEO, follow the six steps below to get started.
1. Define Your Vision
Your vision is unique to you, and it’s a lot of fun to define it. Ask yourself a few questions:
- What do you want your business to look like?
- What do you want to offer in terms of services and products?
- Who are your ideal clients?
- How much do you want to grow?
- What kind of lifestyle do you want your business to provide for you?
2. Start By Delegating Basic Tasks
One issue many owners have when hiring others is that they’re accustomed to doing everything on their own. You know how to do every task in your business, but now it’s time to begin delegating.
First, you need to clarify what is most helpful to you when hiring others. You’ll want to identify the tasks in your business that tie you up and stop you from focusing on more valuable core tasks.
I recommend you consider delegating certain tasks first, such as:
- Administrative tasks
- Marketing
- Production/service tasks
You don’t need to hire a full-time employee, either. You can hire a part-time worker or use independent contractors to start to ease yourself into running your business.
Delegate tasks that free up your time so that you can focus on generating more revenue.
Over time, you want to delegate the bulk of your work so you can focus on higher level tasks, but you can ease into it slowly. Trial and error are part of the process because not every hire will go perfectly smoothly.
3. When Hiring, Consider Attitude Over Skillset
When evaluating candidates, you need to consider the individual’s attitude. Skills and experience are important, but their attitude should be aligned with yours. You both need to be on the same page.
Training can often bridge any skill gaps an employee has if they have the right attitude. But it’s much more difficult to overcome an attitudinal issue.
With that said, if this is your first hire, then you may need to heavily consider skillset too, especially if you don’t have the time to invest in training.
4. Clarify and Communicate Expectations
You don’t have to be the greatest leader, but you do need to ensure that your team knows what’s expected of them.
Be sure that you’re setting clear expectations and communicating them right from the start.
5. Monitor and Provide Feedback
As your initial team starts taking over your basic tasks, you’ll want to monitor their progress and provide feedback to help them continually improve.
One mistake that many business owners make is that they disengage from their delegated tasks. Don’t take a backseat. Inspect what you expect to ensure everything is on the right track.
How do you achieve that?
- Check-in regularly – daily, weekly, or as needed to ensure tasks are being completed properly and on time.
- If the work is being done well, provide praise and positive reinforcement.
- If things aren’t going as planned, offer constructive feedback to help your team improve.
Providing feedback and monitoring performance will help ensure that you’re still on the right track and moving toward your goal.
6. Scale Your Team
Once your initial hires have settled in and are comfortable in their roles, you can start thinking about bringing on higher-level team members to tackle more complex tasks.
Scaling your team will free up time and allow you to focus more on strategic growth.
As you grow your team, you will need to consider whether you want your long-term setup to be virtual or in-office.
- With an in-office setup, it will be easier to manage and monitor tasks.
- A virtual setup will offer benefits and conveniences, but it will require you to be more intentional about communication and oversight. Regular check-ins will play an important role in management. Digital tools will allow you to provide feedback and track the progress of your team.
Weigh the pros and cons of each option to determine which one will align with your goals and vision for your business.
Final Thoughts
Making the transition from sole proprietor to a business owner will free up valuable time that you can dedicate to strategic growth as well as give you more freedom. Use the guide above to develop your own personalized strategy to move into a leadership role with as little friction as possible.
To learn more about managing your business or to schedule an appointment, click here.