For the past decades, businesses have been making noise in the economy and making people earn an immense profit. With that being said, many people wanted to take the risk and have their first business or first company holding on to the idea of gaining better compensation and at the same time being their own boss. As a result, during the pandemic outbreak, the idea of having a small business was unexpectedly rose into a great number. Most of them succeeded. Some have failed, yet many are still striving to run their own businesses.
Some business ventures have failed, but many are still fighting while others are already on the path to a successful business. On the other hand, many people are curious as to how other people manage to run multiple businesses at the same time?
When it comes to owning multiple businesses, you don’t need any luck or business enchantment. You just need to achieve a few things in able to do that.
If you are seeking an answer on how to start and lead more than one business, make sure that you keep reading for this article have all the answers.
Can a person have multiple businesses?
First of all, as a responsible citizen or entrepreneur, you might be asking yourself how many businesses can I have? Is it feasible to establish more than one business but under the same person? The answer is Yes!
There are different types of business structures that you can undergo to establish a successful business, but in order to run multiple businesses, you might want to approach a Limited liability company. Whether you own a food industry business and open a fashion and clothing business, you can operate businesses under one company or one LLC.
For owning multiple businesses, you need to acquire an individual EIN (Employer identification number) to register multiple sole proprietorships. However, the Internal Revenue Services (IRS) are hesitant to issue several EINS for individuals operating similar businesses.
How to create multiple businesses?
1. Create separate LLCs or Corporation
You can start different companies as you like because there is no limit to the number of businesses you can start. You’ll need to set up separate LLCs or corporations for each of them to accomplish this. Thus, the most prominent benefit is that businesses can protect their personal assets and will no longer have to bear the risk of others. They’ll both be legally and financially safe from each other.
However, on the other hand, creating a separate LLC or corporation costs a lot of money and requires a lot of time-consuming paperwork to register the business separately than having just one business.
2. Create multiple DBA
The next thing you can do to legally structure multiple businesses is to form LLC or corporation but have multiple DBA. Doing business As or DBA means each separated company can do business different name.
Pro: You can have a separate identity for each business with unique branding, and it saves you money and effort for paperwork by only registering one LLC.
Con: Separate businesses are not protected from each other, so a single lawsuit and bad image of the company could affect all your businesses.
3. Register under a holding company
The last option to owning multiple businesses is to create corporations for each business and register them under a holding company. This strategy, on the other hand, can be time-consuming and expensive. It could potentially affect your tax situation significantly. Therefore, it is best to seek a lawyer or certified accountant for financial advice before executing your plan to see if this option will work for you.
How to manage multiple businesses
Running a single business involves creativity, implementation of ideas, problem-solving, analysis, managing the workforce and more. That sounds so hard to do, but things might get more overwhelming if you plan to work with multiple companies simultaneously.
Handling two businesses means doubling the effort, keeping values consistent, committed and willing to be in different hats. Without having this idea can even cause a feeling of not reaching the potential of your new business and yourself. To better understand how you can manage running multiple businesses, the essential tips can help you.
Choose business wisely
Before you establish one business or a new company, it is a general rule to make sure that your idea has the potential to run for a long time. You have enough resources to manage it and make a profit. If you think that your next business will take so much of your time and resources and will just give a little ROI, you should calculate if it will be worthy of fighting for. Take note that your other business venture can be affected in the long run if you fail in handling your new idea.
Set your schedule
Time management is an essential component of running a business. When structuring multiple businesses, you might see that your other obligation consumes your free time for another business. With that being said, Scheduling your time can help you to delegate your task effectively. You can have full attention, focus, meetings, deadlines for the business, and give yourself some better personal time.
As for the meetings and appointments, you can set a weekly or bi-monthly meeting with the team or visit them in the office if they all work together in person. By giving your presence to the team, you are ensuring that you are there no matter what. Also, it will be better if you can address their needs or queries as long as it will strengthen the workforce.
One of the reasons that you establish a new business is to have more profit. When you are managing multiple businesses, all your resources and money can be spent suddenly. Hence, you need firm control of your finances to avoid spending, and if you pay, make sure that it is less than what your business makes.
Create regular reports
It is vital to know how your businesses are performing. Advise your team to create regular reports such as HR issues, marketing strategy, income statements, cash flow statements and more. Regardless of whether you own multiple businesses or not, as an owner, you need to analyze and compare all the reports given to see where your new venture can become more efficient.
Analyze your business separately.
Analyzing your business helps in determining where your business lacks and how to improve it efficiently. It is good to analyze the business from time to time based on your employees’ reports. But remember that you cannot explore all your businesses at once, and it is not a good idea to analyze or solve all the businesses at once.
As a responsible business owner, make sure that you analyze your business separately to avoid any unwanted information and misinterpretation about the plan.
Hire the right people
Preparation of reports and other works couldn’t be done if your business lacked a workforce. However, when building teams, you cannot just hire anyone to do the job in your business. Make sure that you examine each applicant thoroughly and hire the right people.
When looking for a competitive applicant to work for your company, it is vital to have the right hiring practices seek people who have a strong sense of initiative and a desire to showcase their abilities. When looking for the perfect executive, consider the following suggestions.
- Understanding of the industry
- Equipped with the right skills
- Demonstrate a willingness to grow and develop to work for the same goal or business plan
- Must be able to work with the same goal of your business.
After you hire the right person, make yourself available to communicate with instructions. However, make sure you offer them enough room to work independently. In addition, hear out to their ideas and suggestions because these things might improve your business. Also, whenever possible, give your employees opportunities to gain new knowledge and enhance their skillsets through workshops and courses.
Set realistic plans and goals
When you set goals and plans for your business, make sure that it is realistic and intelligent. Developing a practical solution lets, you enjoy your business and personal life more. It also prepares you, your business and your team members for unwanted circumstances.
What is a plan that seems look unrealistic? Let us say profiting a million dollars in an hour. Well, that could be done if your business is already established and has many branches, operating in great numbers or already self-sufficient. But if it is just starting, this may not be realistic at the moment.
Learn from past mistakes
One advantage of having different businesses is that you can bring valuable wisdom from your earlier stage in building your previous businesses. When you develop a new business, make sure that you avoid your past mistakes’ inappropriate decisions and build bolder plans to achieve success.
By doing so, you can create a more effective business plan to serve your target market, compete with other companies and develop a better brand.
Setup a work-life balance
There is no easy path to achieving success in running a business. Leading and starting multiple businesses can cause burnout, especially during the early stages. As an entrepreneur, you must have a great perspective in order to keep yourself and your team productive and motivated. One solution to that is to separate personal and work time. Separating personal and work time will keep everyone in the workplace healthier and happier.
Is it better to have multiple businesses?
I cannot give a definitive answer to whether or not having multiple businesses is a good or bad idea. These readings gave out tips about that matter, but in the end, it will be your decision if you will pursue it or not.
Owning multiple businesses sounds fulfilling, especially since many business owners and entrepreneurs are gaining success. But do not rush in into having your second venture. Equip yourself first with enough knowledge from your first business and strengthen the current business experience you have. With that, you can prepare yourself to work for other businesses or with working with business partners in different industries.