Your startup has taken off. Your profits have increased, you have a growing loyal customer base, and you are regarded as a competitor to watch out for.
So, now that you have everything in place, what’s next?
As a business owner, your work is never done. You have to keep your business growing and keep winning new customers while retaining older ones. Then there are products, services, and processes to manage internally. All the while, you have to keep monitoring the market and evolve as it changes. And once you achieve your next milestone, there is always another one to work toward.
Juggling all these components is what growing a business is all about.
Sure, growing a business can be intimidating, but it can be less stressful when you know what you can control and what you cannot. Here are some things you can do to make that growth easier:
1. Determine whether you have the necessary working capital
Business growth requires cash flow to cater to rising business demands. These demands can include maintaining your inventory, updating equipment, hiring new resources, and expanding your infrastructure, among others. You need working capital to meet these demands and to meet evolving business needs. This capital can come from existing profits, or you can seek funds from investors and financiers.
If you are going to seek funds, you’ll definitely need a well-crafted business plan.
2. Develop a written business plan
According to Growthink Reviews, a business plan provides a clear roadmap of what your next step should be. Develop a concrete business plan that details everything you have in mind for your business. This should include:
- The new growth vision (any new product/ service that you may be launching, or any other strategy)
- Target market demand
- Resources needed
- Financing expected
- Sales and marketing plan and projections
- Marketing strategies that you intend to employ
- Any supporting documents as proof to your claims of target market demand, customer needs and financial projections
Your business plan must be well-developed – include facts, figures, statistics and insights based on the research you have done. In fact, having a well-developed business plan is not only the best way to raise funds, but it is also the best way to communicate your growth vision to employees and clients.
Be sure to tailor your business plan to your industry. For example, a software business plan would be very different than a bakery business plan. While both would include similar sections discussing the industry, competition, customers, management team, etc., the bakery’s plan would most likely serve a much different customer base and require different operational capabilities, both of which would need to be explained in the plan.
3. Focus on hiring the right people
Good employees are key for the growth of a business. No matter how innovative your product or service idea is, you can only make it real with people who understand your vision and are inspired to take the idea to fruition.
It is important to hire people that fit in with your work culture. While desired skill set is obviously important, it is also key to have employees who understand and follow your work culture. Otherwise, there will be a rise in job dissatisfaction and decrease in work performance.
Having the right employees and developing the right company culture will be key to your company’s success. When hiring employees start by writing down a detailed job description. If you don’t know precisely the tasks for which you are hiring, it is very difficult to find the right person. Next, be sure that multiple people in your organization interview each prospective new employee. This will ensure that not only do the new hires have the requisite skills, but that they will fit into your company culture. Finally, make sure you have an onboarding process for new employees. That is, new employees should have a procedure to follow upon joining your company. Maybe that process includes shadowing other employees or going through training. In any case, make sure you have systems to effectively bring new hires into your company culture.
4. Avoid delay in financial allocation
It is important to allocate funds to your growth plans as soon as possible. Prepare a detailed financial allocation plan in accordance with your business plan. This is essential for clarity and for preventing mismanagement.
Likewise, be sure to review your business plan and financial forecasts frequently. For example, after the first quarter of the year you should review your financial performance versus your forecasts. In what areas did you do well? In what areas did you not reach your desired performance? Review results while asking yourself why. Why did you do well in one area and not another? Figure out answers to these questions and modify your annual business plan so you attain your financial goals for the remainder of the year.
5. Prepare yourself for unforeseen expenses
As your business grows, there will be plenty of changes in your cash flow and revenue. Be prepared for unexpected expenses; there will be many. Whether it be broken equipment, or the need for a new resource, it is important to plan for such unexpected expenses.
Unfortunately, unexpected expenses often come at bad times. So, when times are good, be sure to save excess cash for future “rainy days.” This being said, when you do have excess liquidity, you should also determine the best investments to make in your company. Should you invest in R&D? In new employees? In technology and/or new software or equipment? Figure out which investments will give you the best return on investment and over what time period. Some businesses can accept a return over 10 years. While other may require an investment over just 12 months. So think about your company’s needs when making investment decisions.
These strategies listed above can help you reduce the stress of growing your business and proactively create effective solutions. Though challenging, the process of growing your business can be exhilarating as few things are better than watching your dreams come true!