Business Growth Too Fast? The problems are there
Like any entrepreneur, you too dream of the day when you have 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 handle? Sure, this is apparently a "desirable" problem, but too rapid business growth can be just as dangerous as a business that never takes off.
5 tips for dealing with business growth in the right way and avoiding critical issues
If you decide that your company's priority is growth, then you need to plan everything carefully and carefully. Growth has its risks, but a correct strategy that provides long-term stability and security can make a 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 coherent and safe growth path.
# 1 - You are following too many customers and you are no longer able to guarantee quality service to everyone
Meeting the expectations of your customers 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 them, cracking a relationship maybe built over the years, and losing it.
Timely deadlines that are not met, requests for quotes or orders left pending too long, managers who are unreachable on the phone for weeks are things that a customer is willing to tolerate for a short time. Then he drops you.
Solution: Make a selection of the customers you really care about and rather get rid of those who create problems for you such as late payments, constant requests for discounts, or who pretend that you can go to their office, perhaps even far away, making you lose a day for a question that could easily be solved remotely.
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 essential and that risk being more of a hindrance than anything else.
# 2 - Your current resources are no longer sufficient and you need to hire staff and / or purchase additional goods or tools
A business that is growing too fast can lead you to have to make even crucial decisions in a sudden and reckless way , perhaps in conditions of stress or in the wake of excessive enthusiasm. But if a temporary momentum in your business doesn't turn out to be as fruitful as hoped, you risk finding yourself with expenses and investments that inevitably turn into losses.
Solution: Take your time and make every decision by evaluating all factors, from cost-effectiveness to upcoming long-term job opportunities. Here are some questions you need to be able 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?
- With which customers can I count on being 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 unexpected events always at the last moment and in first person
When you realize that something is missing, it is already too late. This can be a software upgrade, purchasing goods and tools, choosing the right CRM, an IT service upgrade, a new hire, and much more. Tools and solutions that are decisive for your operation, but which may go beyond your direct skills. Plus, if you find yourself having to make certain decisions when you have water in your throat, the risk of making bad choices is enormous.
Solution: Avoid finding yourself at the last moment, and based on your growth model, plan every move in advance so as not to be caught unprepared. By organizing growth by steps you can also optimize costs, avoiding, for example, having to incur an unexpected expense when you may 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 the company's cash flow
What you've always dreamed of is coming true: your customer package is growing visibly, job orders are increasingly prestigious, in short, and you are making big money. Well, right?
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 downright dire consequences, including penalties, fines, and employee problems and so on.
Solution: Rely immediately on a professional management software and in case of need do not postpone the hiring of an accountant and / or rely on an accountancy firm that is not limited to mere tax management but is able to offer your business advice giving you a complete overview of your company's current situation, predicting different scenarios and suggesting practices and solutions that you probably don't even know exist, such as tenders, deductions and tax breaks.
In the meantime, you will be able to concentrate entirely on your business , without getting distracted and without the risk of making mistakes and missteps, and decide if and when to capitalize on the growth of your company, or save and accumulate resources while waiting for the right moment.
# 5 - You feel at a turning point but you don't know which way to go
You seem to have achieved the goals you set for yourself, your company and your professionalism in your sector 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 a reference or expand by increasing the company structure and the range of products and services offered and / or opening up to new markets? What's the old adage? Whoever leaves the old way for the new one, knows what he is leaving, does not know what he finds...
Solution: If you've never had a mentor, or otherwise a role model, now is the right time to find one. Look for other entrepreneurs in the same field as you, study their path, and analyze their success stories but also their possible failures. Learn from what others have already done and compare it to your situation and next goals.
If you can afford it (and if you are actually 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
Let's 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 sector. Will it be able to maintain its current customer base while accommodating new ones, and in a field where it may not have enough experience?
Solution: When thinking about entering new markets, the simplest solution is often the replication of the original business formula adapted to the new context, area or sector, bearing in mind that looking beyond one's local or sectoral scope should not contemplate the loss. Of the link with the original territory, area or sector.
You don't have to think about a radical change in the business plan on which you have based your business so far, but about an extension of it. Also consider the possibility of a partnership with those who have more experience in the territory, in the sector, in the market you want to enter. But for it to be possible, at least three conditions remain indispensable: a determined entrepreneur; a structure at the height; an investment program tailored to the business project.