Any small company that has tried to expand will tell you that it’s a tricky business! Expansion – whether it’s increasing the number of staff, adding new product lines or more retail locations – brings an array of potential problems and headaches.
The risks of scaling your business are real, and they are as problematic for young startups as they are for large, established companies. But, in identifying the risks, you can work out solutions, learn from others who have faced the same challenges, and become more confident in forging on with your business expansion plans and strategies.
For my own startup, the Irish Biltong Company, our expansion plans are continually growing as new markets present themselves to us. I’ve found that the key is to identify the correct markets and grow in that direction. Here are my top tips for successfully growing your startup:
Maintain a healthy balance
Some business owners (and I was of this frame of mind for a while) think that business expansion is not going to affect their family life, their health, or their personal finances; and that they can be separated from the ongoing pressures of growing the business. Well, I have found that this is definitely not the case! One major change I have made in recent times is to safeguard myself against poor health by getting regular exercise, eating well and spending quality time (vs. quantity time) with family members. This is as important as anything else.
Prepare the whole team for growth
Business growth and expansion brings pressures to your daily systems, and your current structure and team may not have had the time or experience to get geared up for increased production or services due to a sudden growth in demand for your product. Our team had to increase production rapidly to cope with the influx of new sales over a short period of time. Luckily, we were prepared for this potential growth from the beginning and had production capacity schedules to call on and put into action. The team were motivated to deal with this quick growth and it was all hands on deck!
Keep an eye on cash flow
Cash flow is critical to successful expansion, as new timings of payables and receivables can cause financial strain. When expanding and increasing production, it is really important that the daily cash flow is strictly monitored to insure that your company can maintain its daily out. Cash is king – we’ve all heard this saying and it is more true today than ever before, especially for a small business expanding. A healthy profit may look nice on your financial statements, but if capital expenditures or extending credit terms are draining your cash, you won’t be able to stay in business for long. Too often, small business owners fail to focus enough on cash flow generation. For small businesses, handling business accounting and taxes may be within the capabilities of the business owners, but professional help is usually a good idea. Getting assistance with managing cash and the bookkeeping can allow you to excel when others are calling it quits.
Think about customer service
When focusing on growth and rushing to meet a rise in demand, customer service can sometimes slip. As a company who prides itself on customer service levels it was crucial that we ensured the continuing level of service to our loyal customers whilst bringing new customers on board. Smartphones, social media, texting, email, Twitter and other communication channels are making it easy for businesses and individuals to get their messages out. Figuring out the right marketing channels is key for businesses to be successful in the future. These channels are equally valuable when it comes to customer service.
We quickly identified that our key customers were avid users of Twitter and Instagram. By running polls and asking for feedback from our followers, we were able to identify what new aspects of our existing products these customers wanted. Identifying what our customers want and doing a better job of giving it to them has made all the difference in our expansion and planning for the future.
Take employees with you
Employees can become uneasy about change. From the beginning of our business, we shared our vision of growth with our employees. We stirred in them the passion for growth and productivity that we needed to push forward and develop our products. We identified and made the need for change well-known throughout the business. We also facilitated ownership of this change by involving employees in the planning and implementation processes. We encouraged them to offer suggestions of solutions to problems that arose from our scaling activities. We gave genuine regard to the concerns of our employees, and we put procedures in place to monitor the effects of change.
There’s no one way to scale a business, but by ensuring you have the right vision and culture in place, backed by strong procedures, you’ll give yourself the best chance of success. Strong leadership is important, but so it taking your team and your customer base along with you. Our business is growing and, as a team, so are we!
About the author
Noreen Doyle is a New Frontiers past participant, and the co-founder and CEO of Irish Biltong Co. The company produces an award-winning, 100% Irish, gourmet beef snack that is a favourite of sportspeople and nutrition experts around the country… [Read Noreen’s profile]