Strategies for Growing Your Business
Growing a business isn't always a recipe for success. But if you've decided that for your company bigger is the way to go, here are some suggestions for minimizing growing pains.
Project cash flow needs
The biggest problem growing businesses face is a shortfall in cash flow. Before you embark on any growth plans, review your finances. Sit down with your accountant and project several month-by-month cash flow scenarios based on possible sales growth levels—say 10%, 15% and 20%, for example, or whatever makes sense for your business.
Look at when the cash flow gets squeezed and by how much. If you will need to borrow more money or find more investors, then do it now. If you wait until a cash flow crisis arises, you'll have a harder time raising cash. Lenders and investors won't find your business attractive if they feel you have exhibited poor planning skills.
Learn to delegate
Don't wait to start delegating responsibility until you are overwhelmed. Make such delegation a gradual process, allowing others to build the necessary skills and experience while you still have enough time to help them. When the growth crunch comes, they'll be ready and have your confidence.
Staff up now
Just as it is hard to raise money when you're in the middle of a crisis, it's hard to hire good employees then, too. For one thing, you won't have the time to do an adequate search. As a result, you may end up hiring people who aren't up to the task, which can cause long-term damage to your business.
Get the people you need on board before your growth push, and growth will be much easier to manage.
Establish a strategic plan
A growth period can be a hectic time for a business, one in which many decisions need to be made in short order. In such a time, you will benefit from having an overall strategy for growth.
Each decision will need to be made on the basis of how it fits into your strategic plan. You don't want to get off the right path because an idea looks attractive but doesn't really make sense for your business. When you have a plan in place, you'll be able to evaluate your options and choose well.
Understand that growth equals stress
There is no way to avoid it. A business that grows rapidly is a business that produces stress.
Find ways to steal moments of relaxation, such as listening to soothing tapes in your car, meditating, etc. And don't forget your employees. To minimize their stress, take more time to communicate with them about business plans and developments.
Don't go it alone
Isolation can be your worst enemy. Feeling you are all alone makes even the simplest decision difficult. Fortunately, there are places to get help.
One is SCORE, a non-profit association dedicated to providing entrepreneurs with free business counseling (www.score.org).
Other potential resources include local economic development offices and chambers of commerce.
The biggest problem growing businesses face is a shortfall in cash flow.
Visit us at
www.coletaylor.com
