Many businesses will start out as a fairly small operation with perhaps one person as a sole trader, or a couple of people operating as a partnership. Whilst business models may not be given much thought at the start of a business venture, it is important to think about the identity of your business and how it may need to change, particularly as it grows.

An inevitable consideration prompted by business growth is how to adapt your model to suit your changing business. For example, you may have started out as a sole trader but want to take on a partner, or you may have started out as a partnership but want to incorporate and become a limited company, or you may have a limited company and want to work as a joint venture with another limited company. 

There are many different business models and this is something that should be thought about as a business evolves. This is likely to involve taking legal advice on the position and on how to change your business model. Particularly, legal documentation is likely to be required when you change your business model, so seeking advice early is always recommended.

Here are some things to think about when reviewing your business model:

1. Evaluate your current model – consider how you currently work and assess strengths, weaknesses, opportunities and threats;
2. Set objectives – what do you want to achieve? Determine the reasons for wanting to change and what benefit the change will bring;
3. Market research – it may help to look at your target market, customer needs, competitors and industry trends. This information will help guide you in developing a business model to meet both market and customer demands;
4. Consider the options – you could take legal advice or advice from an accountant to consider what might be the most beneficial business model to move forward with;
5. Choose your new model and plan the transition – again you may need legal or accountancy assistance with the legalities of changing your model, but there are other considerations too. These include your existing contractual arrangements and terms of business, which will need to be updated and possibly re-issued particularly if your business identity is changing say from a partnership to a limited company

Changing the identity or model of a business is a big undertaking, and not to be underestimated. It requires careful planning, collaboration and adaptability. The best approach to this is to have a well thought out plan that you follow, and legal support can play a vital part in this. With all of this in place you can successfully transition your existing business to a new model that meets your business needs as it grows.

To learn more about changing or expanding your business, call 01302 320621 or email help@switalskis.com