Growing a business is a unique challenge. You’ve already got off the ground, you know you’ve got a killer product or service, and now you want to build. But the growth stage can be tricky, and you need to be prepared.
Every major business has hit potholes on the road to expansion. We’ve compiled some tips to help you navigate the pitfalls while you grow.
- Not listening to your customers
Growing businesses can concentrate so much on the next opportunity that they forget to pay attention to the customers or clients who are currently keeping them afloat. It’s vital that you give them plenty of opportunities to give feedback on the work that you’re already doing if you want to remain an attractive prospect as you expand. Crucially, though, you need to properly analyse that feedback, and act on it. Build a framework for actioning responses from customers and clients, and make sure that this is embedded in every aspect of your business.
- Missing opportunities
Frequently, businesses looking to grow will pin their hopes on one big deal, or on one single factor that management thinks will propel the organisation forward. Often, however, a single big hitter will come at the expense of many missed, smaller opportunities – and it is those smaller opportunities that might help you secure more sustainable growth. Try not to fixate on single ‘magic bullets’.
- Growing too quickly
It might sound counterintuitive, but one of the biggest risks for a growing business is taking things too quickly. Growing at a faster rate than you can manage can be a killer, putting strain on resources, supply chains, and staff. It’s vital that you take a measured approach to growth if you are to avoid over-reaching.
- Hiring the wrong people
People are key to any organisation, and it’s vital that you are making the right hires. We all know how crucial your first hire is, but that principle holds for businesses at every growth stage. Remember that growth plans need buy-in at every level of your business and, while this should be relatively simple in a small organisation, it can become more of a challenge as it expands.
- Ignoring the nitty gritty
It’s absolutely crucial that you are on top of the legal and regulatory responsibilities that affect your business. Make sure you have trained counsel writing your contracts, check whether you need to change your SIC codes if you’re offering new services or products, make sure that you know your tax position and are building this into your growth plans, and make sure that you are properly insured – especially if you are expanding your product offering. At the very least you should have public liability insurance and employers’ liability if relevant, but the full range of covers required will depend on the nature of your business.
- Avoiding credit
Finally, in a world that increasingly values bootstrapped business success stories, you shouldn’t ignore the value of credit and investment. If you’ve identified an opportunity but you don’t have the resources to secure it, or if you have ambitious medium-term growth plans, you should consider looking for third parties to help you realise them. The era of closed-door VC firms and private banking might not be completely over, but with new developments like P2P lending and crowdfunding, there are more avenues for you to get the help you need than ever before.
By Bonny Dellow, editorial manager at Simply Business