Like any entrepreneur, you too dream the day you’ve gotten a steady stream of customers eager to work with you. But what can happen when business growth is too fast and the workload becomes heavier than you can sustain? Of course, apparently it’s a “desirable” problem, but too fast a business growth can be just as dangerous as a business that never takes off. In both cases the result will be the same: failure.
If you decide that the company’s priority is growth, then you need to plan everything carefully and carefully. Growth has its risks, but a correct strategy that can provide long-term stability and security can make the difference.
We wanted to suggest some signs that can make you understand when your business is growing in a risky way and some solutions that can help you plan a path of coherent and secure growth.
#1 – You are following too many customers and you are no longer able to guarantee quality service to everyone
Meeting your customers’ expectations is the best way to keep them close and, if your reputation is well established, to acquire new ones. But when you are too busy to follow every single customer, you risk disappointing him, to crack a relationship maybe built over the years, and to lose it.
Deadlines that are punctual in time, that are not respected, requests for quotes or orders left pending too long, unreachable people on the phone for weeks are things that a customer is willing to tolerate for a short time. Then you spring.
Solution: Make a selection of the customers you care about and rather get rid of those that cause problems like late payments, continuous requests for discounts, or that pretend you can go to their office, maybe even far away, making you lose a day for an issue that could easily be resolved at a distance.
Dedicate the maximum of your attention to the customers you really care about, and possibly contact someone to manage externally those that are no longer indispensable and that risk being more of an obstacle than anything else.
#2 – Your current resources are no longer sufficient and you must hire staff and / or purchase additional goods or tools
Business growth that is too fast can lead you to make crucial decisions too suddenly and imprudently, perhaps under stress or in the face of excessive enthusiasm. But if a temporary momentum of your business does not prove fruitful as hoped, you risk finding yourself with expenses and investments that inevitably become losses.
Solution: Take the necessary time and make every decision by evaluating all the factors, from the cost / benefit ratio to the expected long-term job opportunities. Here are some questions you have to answer …
- How many people and what tools do I really need to support the current workload?
- Can I entrust, at least temporarily, part of the work to external collaborators?
- What is the growth model of my business?
- Which customers can I count on to be able to continue working in the future?
- In the long run, could I share / delegate some of the work, assuming a less operational and more managerial role?
#3 – Manage emergencies and contingencies always at the last moment and in first person
When you realize something is missing, it is already too late. It can be about updating software, buying goods and tools, choosing the right CRM, upgrading IT services, hiring and much more. Tools and solutions that are decisive for your operations, but which can be beyond your direct skills. If you find yourself having to make certain decisions when you’re on the water, the risk of making bad choices is enormous.
Solution: Avoid finding yourself at the last moment, and on the basis of your growth model, plan every move in advance so that you do not get caught unprepared. By organizing growth by steps you can also optimize costs, avoiding, for example, having to incur an unexpected expense when you have just made another one.
Do not be afraid to rely on those who are more experienced than you, who can provide you with the tools, advice and solutions best suited to your business.
#4 – You are no longer able to manage your company cash flow
You are fulfilling what you have always dreamed of: your customer package is growing visibly, work orders are increasingly prestigious, and in a nutshell you are making money on the palate. Well, no?
Of course, but remember that more cash flows mean more complexity in the financial and administrative management of your business. And inadequate or superficial management can lead to errors and consequences that are decidedly unfortunate, including penalties, fines, and problems with employees and so on.
Solution: Entrust immediately to a professional management software and in case of need do not postpone the hiring of an accountant and / or entrust you to an accounting firm that is not limited to mere tax management but is able to offer your business advice giving you a complete overview of the current situation of your company, providing different scenarios and suggesting practices and solutions that probably ignore even the existence, such as calls, deductions and tax breaks.
In the meantime, you can concentrate entirely on your business , without distracting yourself and without risking mistakes and missteps, and decide if and when to capitalize in view of a growth of your company, or save and accumulate resources waiting for the most suitable moment.
#5 – You feel at a turning point but you do not know what to catch
You seem to have achieved the goals you set yourself, your company and your professionalism in your industry are recognized and established, your customer base is rich and your finances are solid. What to do?
Better to settle further on the position reached in the market taken as reference or expand by increasing the company structure and the range of products and services offered and / or opening up to new markets? How’s the old adage? Who leaves the old way for the new one, knows what he leaves, does not know what he finds …
Solution: If you’ve never had a mentor, or anyway a reference model, it’s the right time to find it. Search for other entrepreneurs in your field, study their path, and analyze their success stories but also their possible failures. Learn from what has already been done by others and compare it to your situation and your next goals.
If you can afford it (and if you’re really thinking about growth you should be able to afford it) consider investing in an Advisory Board, gathering consultants to help you develop a successful strategy to expand your business.
#6 – You have decided to explore new territories
Every entrepreneur, sooner or later, feels the desire to go beyond the boundaries of their starting business model. We think, for example, of a small construction company that has always operated in the residential sector, which sees the opportunity to expand also to the commercial and industrial sectors. Will he be able to maintain his current client base and at the same time be content with new ones, and moreover in a field where he may not have enough experience?
Solution: When thinking about entering new markets, the simplest solution is often the replication of the original entrepreneurial formula adapted to the new context, area or sector, bearing in mind that looking beyond the local or sectoral context, should not contemplate the loss of the link with the territory, the area or the original sector.
You do not have to think about a radical change of the business plan on which you have based your business so far, but of its extension. Also evaluate the possibility of a partnership with those with more experience in the territory, in the sector, in the market in which you want to enter.
Obviously, there are no fixed rules. Each growth path is a story in itself and with its own peculiarities. It can be based on the quality of products or services, on research or innovation, or on diversification. But because it is possible to remain indispensable at least three conditions: a determined entrepreneur; a structure at height; an investment program tailored to the business project.