Tony Lawlor on Navigating the Financial Landscape: Tips for New Business Owners

Start Build and Grow

In this podcast episode, Tony Lawlor shares his expertise on financial management for business owners with your host, Rob Lawrence.

Tony emphasises the importance of understanding finances, managing cash flow, and keeping personal and business accounts separate. Hear why it is important to create a business plan with a cash forecast and regularly review it. And how to make a business attractive to investors, including having a strong management team and a clear exit strategy.

Tony also talks about the art of business valuation and the importance of setting financial and non-financial milestones. He stresses the need to be frugal and to differentiate between wants and needs. Additionally, Tony highlights the significance of building a support network and using resources like accounting software and the Chamber of Commerce for guidance.

Finally, Tony touches on risk management, creating a risk register, and the importance of timely communication with HMRC.

In this episode you'll learn:

Understanding the Importance of Finances (00:00:00) Importance of finances for business success and the impact of cash flow on business failure.

Common Mistakes in Financial Management (00:00:46) Mistakes in overcommitting, mixing personal and business accounts, and trying to do everything.

Setting Up a Business Bank Account (00:02:15) Guidance on getting a business bank account, separating personal and business finances, and utilizing free banking services.

Importance of Business Planning (00:05:15) The significance of having a business plan and an exit strategy for long-term business success.

Creating a Simple Business Plan (00:07:06) Guidance on creating a simple business plan, including mission statement, competition, marketplace, and investment needs.

Financial Planning in Early Business Stages (00:09:12) The importance of cash forecasting and managing cash flow in the early stages of business.

Understanding Cash Flow and Operating Costs (00:11:02) Differentiating between cost of sales and operating costs in the context of cash flow management.

Investor Perspective on Business Evaluation (00:13:21) Key factors investors look for in evaluating a business, including recurring sales, financial tidiness, strong forecasts, and potential for growth.

Hints and tips for reducing business integration (00:14:28) Discussion on how to move away from being too integrated in a business.

Understanding the value of a business (00:16:11) Explanation of the factors determining the value of a business.

Impact of industry on business valuation (00:17:43) Discussion on how different industries influence the valuation of a business.

Preparing the business for sale (00:18:44) Recommendations for making the business attractive before an exit.

Importance of cash flow and KPIs (00:20:25) Explanation of cash flow management and the use of Key Performance Indicators (KPIs).

Managing profit and loss (00:23:02) Guidance on managing the profit and loss of a business.

Financial milestones and targets (00:24:40) Discussion on important milestones and targets for small business owners.

Researching gross margin and competitors (00:27:38) Guidance on finding out the gross margin and understanding competitors.

Balancing business vision and reality (00:28:34) Guidance on managing the business vision and plan in line with reality and expectations.

Who you surround yourself with (00:29:49) Importance of having the right people around in a lonely entrepreneurial journey.

Networking and financial support (00:30:20) Utilizing networking events and the need for financial guidance in early business stages.

Responsibility for finances (00:31:19) The business owner's responsibility for financial controls and potential consequences of neglecting them.

Cost-effective financial support (00:33:16) Utilizing free accounting software and managing finances without an accountant initially.

Managing business risks (00:35:05) Emphasizing the need to manage, not reduce, business risks and the importance of risk registers.

Structure of risk register (00:37:11) Explanation of a simple five by five matrix for assessing and managing business risks.

HMRC and financial management tips (00:38:34) Dealing with HMRC, financial prudence, and the importance of timely payments.

Entrepreneurial advice (00:40:51) Encouragement to be brave, confident, and mindful of financial defense in the entrepreneurial journey.

About Tony Lawlor:

From an early age, Dublin born and bred, Tony Lawlor has always been excited by numbers.

Tony was top of the class in maths at primary school and when he finished sixth form, Tony studied Business Studies at College. However, Tony is now a Fractional FD without a calculator and much more comfortable partnering with people to help solve their problems.

With over 25 years of experience in finance and operations, Tony has built a reputation for enhancing the performance of organisations as a skilled and expert leader believing that businesses that can adapt will survive and succeed.

During 2021, Tony decided to change direction, set up his company Saoi Ltd. Saoi is an old Irish word for a wiseman but has young grandchildren to keep him very much grounded.

In his current role as a Fractional FD, he works with a variety of clients managing a range of finance and non-finance-related tasks.

To learn more head on over to:

www.startbuildgrow.co.uk