Changing Categories: 4 Tips For Making the Leap From Small Business To Large Enterprise

Picture: Randy Tarampi / Unsplash

Many business owners come from humble beginnings, starting their businesses as sole traders before gradually hiring staff and officially becoming small businesses. However, with time, excellent decision-making, and a sound business plan, they can transform their small businesses into large enterprises. 

You might think the process is as easy as just calling yourself an enterprise, but it can be much more complicated. If you’re ready to bridge the gap, it’s essential to do the following things:

Partner with Businesses That Cater to Enterprises

You might have previously relied on other small businesses to cater to the needs of your burgeoning brand, but that may change when you officially reach enterprise status. 

For example, a small IT company can cater to the needs of a sole trader. However, the biggest managed service providers are better equipped to tackle the growing demands of large corporations. At the enterprise level, you need robust strategies and solutions for the cloud, cyber security, and other elements of your IT infrastructure. 

As daunting as it can be to realize you’ve outgrown your service providers, it is also a milestone moment. Indeed, it won’t be long until you realize the benefits of letting a well-established business with other large clients take care of your every need. 

Make Legal Changes

You might have started your business as a sole proprietorship, but growth has led you to consider the liability protection and tax considerations associated with other business types. Changing from a sole proprietorship to another business category requires registering your business with your state. You might also need to close some business accounts and change open contracts. 

If you’re switching from a sole proprietorship to a partnership or limited liability company (LLC), you’ll need to register as such. The process is similar if you decide to become a corporation. However, if you’re changing to an S corporation, you’ll need to form a corporation and ask the IRS to give you S corporationstatus. 

Explore Your Technology Requirements

You’re no longer a small business as soon as you have more than 250 staff members. The more employees you have, the harder it can be to keep track of productivity, profit, and everyday operations without relying on technology. 

As a result, changing from a small business to a large enterprise can be the perfect time to explore your technology options. For example, you might rely more heavily on KPIs to measure progress and implement performance development plans to ensure employees remain on track. 

Many enterprise business owners also transition from in-office servers to the cloud to benefit from the scalability and cost savings and to ensure all employees can access critical business information no matter where they are. 

Prepare Your Team

Moving from a small business to a large one can be daunting for business owners and their employees. While large companies typically offer better career prospects, benefits, and salary packages, the positions can be less personal. Employees may also see their management teams less than they did under a previous ‘small business’ ownership type. 

The change can be scary, especially if it’s unexpected. So, communicate changes as they happen, provide extra training, and prepare your team well in advance. 

Transitioning from a small to a large business or enterprise can be a milestone event, and you’re likely excited about your professional future. However, it’s essential to take the steps above to ensure the smoothest transition for all involved.