Every successful business had a beginning. Its founders usually looked for ways to gradually expand, attracting new customers and increasing monthly revenue as it went. From the outside looking in however, that type of success feels as though it requires some type of hidden formula. After all, it can be easy for an entrepreneur to fall prey to the whims of a difficult market or to make a series of mistakes that eventually leads to failure.
In order to move your business to the next level, expansion will likely become necessary at some point. Whether this means growing your product line or setting up an additional brick-and-mortar shop, a long-term growth strategy can make a huge difference. As most business leaders know, though, too much growth can sink a small business. Here are a few tips to help you grow your company using the resources you currently have in place.
Create the Right Culture
When building a company, leaders are advised to create a strong work culture that attracts top talent who are motivated to work. But it's also important to build growth into that culture, ensuring anyone you add to your team has the same vision you do. In the Silicon Valley startup ecosystem, I've seen founders and their board members forget this at times, as they seek to install someone with the right pedigree but perhaps the wrong cultural fit.
In a growth-mindset culture, employees should be given the freedom to contribute to the company's success, which can lead to an increased sense of commitment to the future of that business. The wrong combination of people can discourage that kind of contribution, and push the company in the direction of stagnation.
Increase Your Working Capital
To fund your company's growth, you'll need money. Ideally, you'll have a venture capitalist eager to invest heavily in your company. However, that often won't be the case until you can gain significant traction within your market. Instead, you should have a plan in place to give yourself the extra capital you'll need. This could mean cutting back on expenses, utilizing the services of freelancers rather than making new hires, finding ways to move unsold products off shelves, or taking out a bank loan. With extra money in place, you'll have what you need to add products to your inventory, hire the right people, or expand your leased space to accommodate your growing business.
Hire for Versatility
When it's time to build your team, your entire hiring process should be managed with growth in mind. This is especially true if you'll be working with a small team of people who will be required to fill several roles. You'll get much more from a generalist who can help you brainstorm marketing ideas in the morning and manage your manufacturing and distribution processes in the afternoon.
Conduct Market Studies
Many businesses carefully study their market in the beginning, but as they evolve, they fail to continue to monitor it. As you consider your next phase of growth, research your market through the use of online polls and customer studies. If you're considering adding a new product or service, this is especially important, since it will show customers that you care what they think. If you're thinking about expanding to a new location or demographic, make sure you've thoroughly studied that market and know that you have the customer base in place before proceeding.
Plan One Step Ahead
As you focus on daily operations, you should also keep a small part of your mind focused on the next phase. If you think online sales are the next step for your local brick-and-mortar, for instance, you should be looking into web providers and monitoring how your competitors are handling online sales. When you do have the bandwidth necessary to expand, you'll already have more thoroughly thought through what is required and you'll have a plan in place that will make it easier. Most importantly, the work you do today will be conducted with that phase in mind.
Stay Focused on Your Customers
One of the biggest mistakes entrepreneurs make as their businesses grow is that they lose sight of their original customers. These are the loyalists who will continue to buy from you even if you never expand. Make sure you're providing the same great service that you provided before, including product delivery times and service quality. You should also make an effort to show appreciation to longtime customers with special discounts and the occasional thank you when they call for assistance.
Know Your Limitations
The key to success in any expansion is to recognize what your limitations are. This is specific to you and your business. Long before you make any firm decision, plan a worst-case scenario of how much the expansion will cost and how many resources it will consume. If adding an additional product or new locations will require too many extra employees, for instance, you'll likely need to table the add-on or, at the very least, grow more slowly.
Most businesses hope to eventually expand and bring in more revenue, reaching more customers. However, if a business tries to grow too quickly, it can lead to disaster. It's important to plan carefully for the day you'll expand and only make the move once you're sure you have the resources to handle it.