Running a small business is like sailing a raft with no rudder. You float around aimlessly, just hoping to hit dry land before you sink. Every decision counts and even the smallest mistake could have significant repercussions. As an ambitious person, striving for your big break, you are no doubt eager to expand beyond your own locality. While growth is a natural progression for most profitable businesses, it’s not always the most financially viable option.
Plan for Rapid Expansion
Rapid expansion is one of the main reasons why most small businesses fail. As their client base increases, so does their workload and expenditure. Sometimes the very thing that’s keeps a business afloat – such as low prices – is what eventually makes them sink. When developing a business plan it’s important to set realistic goals – note the word, “realistic.”
It’s not uncommon for small businesses to grow above and beyond their original projections. If you encounter this situation and don’t have the management skills to make it work fluidly, your entire operation could fall apart. According to Forbes, this is one of the reasons why rapidly expanding companies bring on experienced CEOs. Rapid expansion, while certainly positive, should be factored into your contingency plan. You need to prepare for every realistic outcome – this is certainly one of them – and how your company will cope with the excess workload and pressure.
Streamline your Communication Systems
When you’re engaging in commerce, you must have a secure and stable communication system. Although you can use standard web-based applications for customer service and general in-house communications, most third party software isn’t stable enough to support business activities.
Private VoIP wholesalers are more suitable when delivering sensitive information via a voice termination network. The enhanced security offers clients greater peace of mind, while the constant stability ensures business activities can continue uninterrupted from network failures and other external problems. If growth is an inevitability, it’s imperative that you set up and streamline your communication system before any changes take place. IDT Express can provide a free test account if you’re already entering this stage of business.
Get Hiring Now
Nobody said it would be cheap! Unfortunately, growth and expenditure come hand-in-hand. Hiring workers on the fly is dangerous as you’re essentially working against the clock. By the time you find a suitable employee, the opportunity could pass. On the other hand, taking someone on before you’re ready will cut into your company finances before you can recoup the investment.
The best time to start hiring is when you notice positive trends, and while your current workforce can handle the load. Anticipating growth in advance limits the risk factor. If you’re expecting growth, but yet to see results, hold tight and consider using freelance or temp workers instead. This will help you manage large one-off orders, or sudden spikes in business, but alleviates your long-term liabilities.
Leverage your Professional Skills
The fastest and most effective way to expand is to use your current line of work to advance into other, more profitable departments. For example, if your company is a supplier of raw materials, it could start manufacturing.
Leveraging your current professional skills will help you tackle new industries using the positive reputation you’ve worked hard to build. You may even be able to kickstart your new venture by targeting old clients. If you’re struggling for ideas, Skyline Offices’ guide to small business ideas could help you find a venture within your startup budget.
You may have modest goals and feel happy with your current situation; that’s perfectly fine! The decision to expand your business need not be financial. In fact, many small businesses grow organically without even realising. It’s a process to be both welcomed and feared. But whether you decide to push forward or slam on the brakes, you should always prepare.