Today, most entrepreneurs are seeking to add more businesses in their portfolio as they believe in the principle of not putting all the eggs in one basket. The question remains, how much more money can you make with the additional businesses? It is also critical to address what motivates a person to own more than one company. Some entrepreneurs choose to do this to provide them with a new challenge if they get bored with their existing business. Others do it as a hedge strategy, especially when they are unsure about one specific venture.
Many argue on the contrary that having multiple businesses is not an advantage and one should focus on one business per time. Focus should first be given to the existing business, where problems are present with the growth strategies, before new venture ideas are explored. By doing that, the entrepreneur is able to determine whether its best to grow the business or fix the current
Structure Your Multiple Businesses
The legal structure of a new business (or a third one) is an important decision. There are several ways to manage more than one business, each with their own benefits and challenges.
Create separate LLCs and Corporations: One way to do this is by creating individual LLCs or corporations for each business. It ensures that the businesses are separate and protected from each other’s risks.
Multiple DBAS under One LLC or Corporation: There’s an option to create separate Doing Business As awardees (DBAs) for every business operated by the business owners. This is more cost-effective as it does not incur registration and paperwork costs. However, it also poses a risk such that when one of the LLC’s legally active businesses gets in legal trouble, all other companies are likely to be affected by the court’s decision.
Businesses under a Holding Company: An alternative is putting together several businesses under one holding. This can be beneficial if, for example, you’re looking to grow your business or purchase another company. This approach is complicated and may involve tax problems. Before employing this
The best structure depends on your goals and circumstances. Each structure has pros and cons. The right structure, when chosen with care, can help you achieve financial success.
Manage Multiple Businesses
Running multiple businesses simultaneously requires strategic hiring and resource optimization. Here are some practical strategies to keep things running smoothly.
The Right Team to Hire:
To manage multiple businesses, you need a solid team. By surrounding yourself with talent, you can ensure that each venture will thrive independently. You can focus on your high-level strategies while delegating day-to-today tasks to the right people.
Choose Projects With Care:
Assess the profitability of a new venture and your resources before you start it. Ask yourself if you should pursue a project that requires a lot of time and effort.
Consider a shared workspace:
Use a shared space if possible. You can stay active in both businesses without having to waste time on commutes. If sharing isn’t possible, keep your businesses near each other to reduce travel time.
Organize Your schedule:
When managing multiple businesses, time management is crucial. You can keep everything on track by creating a detailed schedule that will allow you to allocate time for meetings and important tasks.
Track Your Time
You can gain valuable insights by using time tracking tools. You can optimize your schedule by identifying time-wasters.
Optimize Shared Resources
Share resources between your companies to save time and money. Centralizing administrative tasks such as payroll and marketing can, for example, streamline operations and reduce cost.
Regularly Review Business Performance:
Regular performance reports, especially financial ones, are essential to track the progress of any business. These reports can help you to identify areas of improvement and determine where additional resources should be allocated.
Learn from Experience:
Every business has something worthwhile to learn. Such mistakes do not have to be repeated in new projects enhancing chances of success in new endeavors. Learn to Draw A Clear Line Between Work And Personal Time:
Running multiple businesses can drain a lot of energy. To ensure minimal instances of exhaustion and maximize long-term productivity, there is a great need to strike a balance between time spent working and time off work.
Increase Your Income by Having Multiple Businesses
Owning multiple businesses gives you the chance to earn even more. It can be very beneficial to have many business interests.
Having Multiple Sources of Income:
The advantage of owning several companies is that there are also many sources of income. Being diversified is a great way to insure your finances. If one firm is struggling, other ventures can help soften the blow.
Increased Profit Potential:
Out there in the business world there are some researchers that state business people who work in more than one firm have greater earnings than an individual dedicated to one. With every new business set the chances of overall profit increases. It is more practical that the greater the number of businesses operated by an individual the better the chances of more wealth and growth.
Long-Term Investment Strategy:
Owning multiple businesses can also be seen as a long-term investment strategy. With the passage of time every business is likely to mature and be very lucrative. That means the entrepreneur can capitalize in several market trends and reap good rewards in the long run.
Conclusion:
Establishing and running multiple companies can be time consuming and challenging but it can also enhance growth and diversification. It is possible to enhance earning through appropriate structuring of the business, availing the best resources and management of the different assets. Your ventures in business will not just be maintained but flourish when the right strategy is applied.
