Too much success can actually be bad for a small business. Here’s what you need to know about handling growth.
It’s utterly counterintuitive, but you can succeed too quickly. It’s happened before: a startup or small business produces something that’s wildly popular, over-expands their operations, and suddenly finds themselves crumbling under the insupportable weight of their own success.
Sure, instant (or pretty darn quick) success is what every small business hopes for. But unless you know what the risks are — and how you can mitigate them — poorly-managed success can capsize everything you’ve worked so hard to produce.
No, It’s Okay – I’ve Got a Business Plan
A business plan is a good idea, and it can give you a template for starting your business (not to mention getting some funding). Notice the sections that the SBA lists as part of a standard business plan:
- Executive Summary
- Company Description
- Market Analysis
- Organization and Management Structure
- Service/Product Description
- Marketing and Sales Strategies
- Financial Projects (i.e. what you expect your company to do over 5 years)
- Funding Request
- Appendix (for supporting or additional documentation)
Yup, you’ve got getting started all covered. But what about taking off?
In this OPEN Forum post, Carla Young breaks down seven ways that success can scupper a business. She lists everything from cash flow problems to leadership failures. A common theme for all of them is putting growth before planning.
Ideally, you’ve built some flexibility into your business — this is the scalability and agility you so often read about. It basically means being able to meet changing business needs by planning for the ups and downs of normal operation. Let’s look at a couple of common-sense ways you can make your business a bit more agile.
Handling Success and Growth
Even an incremental uptick in business can sometimes leave companies scrambling. How can you leverage the tools you already have — most importantly, yourself and your employees — to meet increased demand?
- Find small ways to be more productive. You can make the most of your time by implementing these time management tips.
- Outsource what you can. You may want to hire out things like accounting, bookkeeping, or IT management — anything that’s not mission critical to your business. This will free up even more of your valuable time and manpower.
- Get the right software. Find and use Customer Relationship Management software to make sure that customers aren’t falling through any operational cracks. Often, it’s the customer service that suffers when things get crazy busy; a good CRM will keep you on track without breaking your budget.
- Make sure your IT infrastructure can support you. It’s a good idea to have an IT system in place that can grow with your company. That way, you’re not faced with expanding your IT, learning a new program, and handling more work.
You put a lot of thought into getting your business started. Make sure you also have a plan in place to help it cope with success!