Ask any business owner on the planet, and most will tell you they want to grow their company. It’s easy to see why – after all, a growing business makes more money, serves bigger markets, and enjoys a more authoritative name, right?
Sadly, that’s not quite the case. In fact, business growth poses many challenges to small companies, and a lot of firms have ended up dying a death instead of enjoying a long, healthy, and profitable future.
So the big questions to ask today are – what are these challenges, and how can you spot them? Let’s take a look at everything you need to be wary of when growing a business.
It should come as no surprise that growing a business requires investment. You can’t expect a new office, a lot more inventory, and hiring staff to meet higher demand to pay for itself. As smallbusinessloans.co point out, there is a broad range of small business loans you could take out, but the reality is that the cost could be even more than a bank is willing to lend. You will certainly have to stump up some of the cash required from your profits – and even your personal savings. You might have to find funding from private investors, too, which will ultimately lead to you losing a significant amount of control over your business. Think carefully before investing in rapid growth, as it may cost you more than you realize.
As a small business, you are likely to have a lot of time to spend with each customer -it’s what separates you from the other major players in your industry. However, service quality can often take a dip in the wrong direction when you grow too fast. You’ll find that previously loyal customers may not like the ‘new you,’ and you end up with less market share than you had in the first place.
As Forbes.com state, it’s one thing being the boss of a small business – but another entirely becoming a leader of an enterprise-level company. In simple terms, your role is going to change, and you might not like it. You won’t be able to keep the tight control over your business as you had previously, and you will need to take a top-down approach, start delegating, and hire people you trust to run departments. Many small business owners end up feeling dissatisfied as they move into a more managerial/director level role and leave their hands-on approach behind.
Not everyone likes change – especially employees. Even your most loyal staff will have concerns about the future, and the reality is that they may not have the skills to do the job as your company gets bigger. There will be tough decisions to make – Martin from accounts might be able to run your small business books, but can he head up an enterprise-level financial team? The bigger the company, the more responsibility you need from your team. And the more you need to encourage and persuade them that they are still relevant, wanted, and appreciated.
Growing a business can bring you enormous success – but it can also kill your business stone dead. Avoiding the problems highlighted above will help you end up in the former camp – good luck!