Besides the launch phase, growth spurts are the second riskiest time for many businesses. An unexpectedly successful marketing campaign, a sudden change in consumer needs, a ‘hot’ market for a particular type of product or service – any of these things can cause challenges for your business.
The question is – will your business cope?
Consider the following points when determining whether or not your business can handle a growth spurt.
With sudden growth, often comes an influx of revenue and while it can be tempting to splurge on the many things on your business ‘wish-list’ or start splashing out the bonuses, one of the best investments you can make at this juncture is in solid financial advice.
The costs involved in surviving sudden growth are often not evident until later. Additional tax responsibilities, new salaries and super commitments, as well as additional equipment, stock and leasing more space, will all pile up.
Expert financial advice will help you plan your way through the changes that are happening and set your business up with the right kind of cash flow and reserves to cope with the upcoming costs, as well as keeping things running while you scale up.
Keep up-to-date financial information readily available so you can quickly assess what resources you have available. Besides available funds, each business must have the resources to manage the increase in incomings and outgoings. You’ll also need to analyse your payables and receivables, as well as staying on top of cash flow forecasts.
Taking preventative steps now, could save a lot of trouble later and make the difference between business survival and extinction.
If you assessed your current infrastructure today, would you be able to identify the processes and roles who would bear the brunt of additional business?
A solid business infrastructure ensures the proper coordination of all human resources, processes and other operational tools necessary to ensure profitable growth.
A solid infrastructure in place also ensures your business doesn’t crumble under the pressures of expansion, has a solid and replicable foundation and consistency in the delivery of your product and/or service.
The right staff
If expansion is on the cards, it’s important that you are equipped with a solid recruitment strategy that will help you have the right staff on board. Having a strong team of HR professionals is crucial for any growing business as they will facilitate the transition as you begin to grow. Remember to also look at additional skills and knowledge your business requires as you grow.
Roles such as project managers, property managers and human resources are often the stress points within a business when things get busy.
Do you know how much more time each of your team has in their day before they are regularly tipping into overtime?
Understanding your team’s stress-points can help you plan for a rapid scale-up, what support do they need to maximise their strengths, and who can fill those roles.
Spend time considering the future and how many staff members you’ll need to grow. Mapping out teams is a critical part of this process as well as employee growth plans that will help you attract the right staff.
Evaluating how you spend your time is crucial during a growth spurt. Outsourcing allows you to expand your capacity without hiring staff, leasing a larger space, or investing in additional equipment. Focus on performing activities that have a high return on investment and consider outsourcing or completely eliminating the rest.
Ensure that you have a long-term game plan for your business, and that includes setting up to accommodate for future growth spurts. Know what you are aiming for and be extremely clear on what you are targeting and more importantly why.
At BDH Leaders, we advise you how to strategically expand your business. View more information on our business services here.