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The legends of business history are many, and never more so than those surrounding those rare companies which came out of nowhere, seemingly overnight, to rise to dizzying heights and stock levels. Because these examples are so talked about it, it can help to form slightly unrealistic expectations for some entrepreneurs. We may talk about modest projects, but our hearts secretly buzz with the ‘what if?’ of stratospheric success. Of course, optimism and an ability to think big are both common traits in those who start their own companies, but there is a careful balance to be had between hoping and planning for the best, and severely misjudging a situation – those kind of moves can be life-or-death for a fledgling company running on lean margins. So, before you make the moves to support a sudden high growth phase, you need to be really sure that your business – and, crucially, you – are ready.
Perception Vs Reality
The idea of growing your company swiftly from an idea in your notebook to a flourishing, expanding, profit generating empire is intensely exciting. Expansion is the dream for a lot of entrepreneurs – ideas for new products and services are overflowing, and the prospect of more customers, more sales and more income is highly seductive when you’re more used to budgeting every penny. If your business has a physical location, you may be dreaming of cutting the ribbon on that prestige new location or the showroom, storefront or office you’ve always pictured. But now is definitely not the time to lose focus and get caught up in the nicer trappings. Growth readiness is a whole phase in itself, and one that can trip you up severely if you neglect it. It’s definitely your job to champion your operations, but you have to also be realistic about what you can do. So, how can you be sure that your company is actually in a solid position to begin expanding?
Your Customer Base Is Secure
Any business is only as good as its users, clients or customers. After all, they are the people who put the money into the business and allow it to thrive. And although at some level we acknowledge this, it’s very easy to get carried away with a ‘build it and they will come’ mentality when it comes to the idea of expanding your business. Expanding means one thing – additional outlay eating into profits. You may be paying out for new business premises, additional equipment, extra stock or for hiring in staff. You could need to build up your website so it’s secure and can handle increased traffic. This all comes out of your bottom line, so you need to make sure that your budget is robust enough to sustain a temporary hit. This means ensuring you have the type of loyal customers who will buy into what you’re doing and continue to purchase your product or serviced reliably. A sudden drop in income at this point could be catastrophic.A regular base of clients, with a steady upward curve, are the conditions you need to support this. Go back to the sales data you’ve amassed and analyse it carefully to see what the situation is – this isn’t something where you should rely on a gut feeling. If the numbers don’t stack up, hold back until they’re reading more positively.
You Have The Expertise And The Tools
There is an awful lot to learn when you’ve just launched a company, and as each situation and business is different, that holds true whether you’re a seasoned leader or a newly minted one. It’s impossible to know everything, even if you’re experienced, as the pace of change in modern business can be quite dizzying. So part of your evaluation process should be taking stock of the skills and assets of your operation as they currently are – including your own. It may be that you need training in a specific area in order to carry the business forward. Or perhaps you need to upgrade your systems as an enabler for the leap you want to make – the technology must support the process. It could be that you need to work with a marketing agency to develop and strengthen your brand to ensure you are positioned right and can gain crucial advocates among your audience – or target new ones. Being able to conduct a clear eyed analysis of assets and skills is a valuable weapon in deciding if your company is ready to take to the next level confidently. Don’t get stuck in analysis paralysis – but do have a clear plan and a good view of your readiness.