25/11/10

By Darren Shirlaw

As we discussed in the previous article Understand Your Business Stage - And Prepare For Advanced Growth, recessions often fast-track businesses into this second brick wall by reducing client numbers and increasing staff issues, including redundancy.

The owner now has to deal with debtors, creditors and cash flow problems. Suddenly, they move from a client focus to dealing with the mess in their back office. Stress kicks in for the owner who thought they were doing so well in 2007.

By 2010, the same owner has been catapulted into their second brick wall.

“Advanced growth is the most productive stage. It’s when your business makes the most money and most increases its equity valuation”

Advanced growth

Hitting your second brick wall during a recession is the right time to start planning for recovery.

We’re now seeing more businesses in this situation and smart owners are trying to time their entry to advanced growth with economic recovery. The simple message is one of timing.

Normally, businesses spend three to seven years in their second brick wall as the economy moves gently along.

They don’t have the additional pressures of too few clients, difficult sales or lengthy processes because they’re supported by a strong economy.

Right now your business cycle, and journey through that brick wall, isn’t being supported by the economy. If we assume the economy will experience a double-dip recovery, we simply haven’t got the normal seven years to transit the brick wall.

“Every other W-shaped recession has been over in about three years. Theoretically, we could be into full recovery in one or two year’s time”.

Fast-tracking for advanced growth

So what does this mean for your business?

If you’ve just entered your second brick wall, you’ll need some fast-tracking to prepare for economic recovery. Now the pressure is really on to get out of that wall and into what we call advanced growth — the gap between the second brick wall and the third.

Advanced growth is the most productive stage. It’s when your business makes the most money and most increases its equity valuation. It’s also when the business owner is the least bogged down in day-to-day management and probably the time they most enjoy.

During payback you were getting good money from the business, but it was still very reliant on you.

In advanced growth, you’ll still get good money, but the business isn’t so reliant on you and therefore the enjoyment is significantly higher.

“If you can time advanced growth to coincide with economic recovery, then you’re on to a winner”

If you can get your timing to coincide with economic recovery, then your business will fly. But if the economic recovery kicks in and you’re still restructuring your second brick wall, then you’ll miss an essential opportunity.


Shirlaws is an international business performance and coaching company. We help business owners achieve their business and life objectives. Our programmes have changed the lives of thousands of business owners all over the world by removing barriers to growth and ensuring their business pays them richly in money and time. What Shirlaws brings is a language and system for growing businesses and building internal capability. A language and system that gives our clients three simple things: more time, more money, and less stress. Founded in 1999 Shirlaws has now grown to include operations in North America, UK, Europe, Middle East, Australia and New Zealand. Our coaches take the many complex issues involved in running a business and help make them simple and easier to manage. We work alongside clients to guide their businesses to achieve long-term, profitable and sustainable business growth.

To find out more you can download our new book for free at www.shirlawscoaching.co.uk

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