“The best time to start preparing your business for the future is long before you think you need to.”

For many business owners, growth is measured by one thing: turnover. But according to Richard Murray and Martin Brown of Elephants Child, that’s one of the biggest misconceptions holding SMEs back.

With decades of experience helping business owners increase value, improve governance and prepare for successful exits, the pair believe the businesses that thrive aren’t necessarily those growing the fastest—they’re the ones growing with purpose.

Growth isn’t just about revenue

Richard is quick to challenge the obsession with turnover.

“Not every pound of revenue is created equally. Business owners often focus on turnover because it’s visible, but what really drives value is the quality of that revenue.”

Recurring, contracted income, healthy margins and predictable earnings all contribute far more to business value than one-off sales, he explains.

“It’s about understanding the difference between revenue that creates long-term value and revenue that simply makes this year’s figures look good.”

Martin agrees, adding that value creation goes far beyond financial performance.

“We recently worked with a client using nine value drivers—from profitable growth and customer diversification through to operational excellence, management depth and governance. Those are the things that really increase the value of a business.”

Most businesses are driving by looking in the rear-view mirror

One of the biggest issues the team encounters is a lack of forward-looking management information.

Richard recalls working with two highly successful solicitors who unknowingly continued taking drawings from their business despite making a loss.

“They only discovered ten months later that they’d been living off reserves built up in previous years.”

He believes this is far more common than many realise.

“Probably fewer than 5% of the businesses we meet have the board structure and management information we’d consider fit for purpose for driving the business forwards.”

Rather than analysing what happened months ago, business owners need real-time insight that enables better decisions today.

Start planning earlier than you think

If there is one piece of advice both Richard and Martin wish every entrepreneur would take, it’s simple.

Start earlier.

“Most owners don’t realise their hair is already on fire,” Richard says with a smile.

Preparing a business for sale isn’t something that happens in a few months. Between preparing the business, taking it to market, completing a transaction and handing over to new owners, the process can easily take four or five years.

“Too many people think they’ll deal with it when the time comes. By then it’s often much later than they think.”

A crucial part of that preparation is understanding what Richard calls your ‘magic number’—the amount you ultimately need from your business to achieve your personal financial goals.

“Once you know that number, you can work backwards and build a business capable of delivering it.”

Don’t forget the human side

While financial performance matters, Martin believes owners often overlook something even more important.

“The business is only one asset. The real question is how you convert that into personal wealth for you and your family.”

He recently met a highly successful entrepreneur leading a £40 million turnover business who hoped to exit within four years—but had never received pension advice.

“That’s where the human side comes in. It’s about making sure the success you’ve created in your business translates into security for your family.”

Planning beats waiting

Looking ahead, both believe the businesses that will outperform over the next five years will be those willing to take control rather than wait for external events.

“Businesses only have two finite resources,” says Richard. “Time and money.”

“The companies that consistently outperform are the ones that deliberately plan how they’ll use both.”

That includes embracing AI and automation where appropriate.

“If technology can save time and money, you can reinvest those resources into activities that genuinely create value.”

Martin believes too many business leaders are waiting for governments, devolution, infrastructure investment or policy announcements before making decisions.

“Our view is simple—don’t wait.”

“Control what you can control. Build your own plan. Get on the front foot. The businesses that thrive won’t be waiting for politicians to tell them what to do—they’ll already be moving.”

An invitation to B4 Members

Richard and Martin are keen to help more business owners understand where they stand today—and where they could be tomorrow.

“As part of the B4 community, we’re offering members a complimentary business clinic,” says Martin.

“That can include an initial business valuation and a conversation about where your business is today, what opportunities exist and how you can begin creating greater long-term value.”

As this conversation demonstrates, the biggest opportunities often aren’t found by working harder—they come from thinking earlier, planning better and building a business that’s designed to succeed long before the exit comes into view.

About Elephants Child

Elephants Child is a holistic business advisory firm dedicated to helping ambitious SME owners grow stronger, create more valuable businesses and ultimately enjoy exit. Working alongside leadership teams across the UK, the experienced advisory team provides practical support to accelerate growth, secure funding, improve performance and prepare businesses for successful exits. Rather than offering theoretical consultancy, Elephants Child combines strategic thinking with real-world commercial experience gained from building, leading and selling businesses. Since 2007, the firm has built a reputation for trusted advice, long-term relationships and delivering measurable results. (Elephants Child)

Find out more

Interested in creating more value in your business? Richard Murray, Martin Brown and the team at Elephants Child are offering B4 Members a complimentary business clinic to explore business value, growth opportunities and long-term planning. If you’d like to start the conversation, get in touch via the links below. (Elephants Child)