Is the time right for growing?
Many business owners try and expand their businesses before they’re ready to grow.
Answer the following questions before proceeding with any expansion plans.
- Have you built a strong management team?
- Have you developed a strategic plan, and does the proposed expansion mesh with your overall goals?
- Have you or a consultant conducted a strategic audit or assessment to evaluate your company’s strengths and weaknesses, which is essential to planning healthy growth?
- Have you discussed the expansion with your board of directors, employees and/or an outside consultant, and do they support it?
- Do you have the necessary financial and human resources to handle an expansion?
- Have you examined the external factors affecting your business (such as industry trends and the economy) to gauge if the timing seems right?
- Have you compared your company’s performance with other companies of similar size, and is your company performing well by comparison?
8 rules for growing
- Plan for growth in your business. Set targets and performance criteria and make sure every staff member is accountable for achieving the objectives.
- Control all costs. Controlling costs is critical for growth because growing does not necessarily mean that you are making a profit. Many businesses go under because they have grown too fast and the growth outstripped the people and cash resources of the business.
- Put in systems. You should have good reporting systems built in to the business so that information can be extracted very quickly and easily. Financial results should be measured against projections. A good reporting system will keep you informed and equip you to make quick decisions as required.
- Motivate Employees and Management. Your business will only be as good as your people. Motivate and encourage them. Make them feel part of all that goes on. If they feel they have a say and can bring input into the decisionmaking that will empower them to perform snd be more productive.
- Involve all management and staff. Bring everyone into the picture so all know what is expected and how things will be done. Have frequent meetings to review results and to monitor performance.
- Review Periodically. Review often how your business is going compared to predetermined budgets. Make necessary changes as required. Plan and move ahead using the past as a guide and learning from what has gone on before what to do and what not to do
- Go for Success Go for success. There is no point being in business unless you are going to win and make a profit
- Never Quit. Never give up. . Never give up if things don’t go to plan. Simply pick yourself up and get your business moving again, eventually you will succeed.
Do a growth assessment
One of the first things you will need to do when preparing to grow your business is the carrying out of what is known as a growth audit. A growth audit is basically the process which allows you to assess the strengths and weaknesses in your business before moving into a strategy of growth. It is essential that you know where you are and where you have come from if you are to determine the right direction for where you were going. Do not move into a high growth mode until you are clear as to where that business is at, at that present time and also what you want to achieve when you start your expansion.
Growth questions to ask
Here are some of the questions that you need to ask yourself regarding various areas of the business before you start your growth push.
- Are you clear on the goals of your business?
- Are your managers and other staff also up to date with these goals?
- Does your accountant or other adviser know what you are planning?
- Have you developed a business plan which brings into play the whole area of growth, which includes the resources that will be required of it?
- Have you assessed the performance of your marketing and advertising sections and if so, are these adequate?
- Have you put in strategies to get repeat sales?
- Are you clear about your competition and what you need to do to win when you start expanding your operations?
- Are you confident about your current advertising plan, including whether you have identified your target market and also the methods by which you will reach that market?
- Have you put in place policies for your employees?
- Do you feel you have loyal and productive staff?
- Have you put in place strategies for motivating your employees? This could include a system of extra remuneration or some other way of acknowledging their efforts.
- Are you familiar with the changes brought about by the latest technology?
- Have you put in place the necessary procedure for monitoring and control of the inventory?
- Have you put systems in place for all other areas of your business, including administration and finance?
- Are you cultivating relationships with your suppliers in order to get feedback on your prices as well as your service?
- Do you have current financial statements giving you a fair diagnosis of how your business is doing, also giving the current situation of your profit, as well as assets and liabilities?
- Are your tax records in compliance with the Tax Authorities and are they up to date?
- Do you have an effective credit control in place, as well as collection of monies owing.
- Are you happy with your payment procedures, especially where purchases are involved, with payments made to secure discounts offered.
Consider the 3 crucial phases
The 3 crucial phases in any business are:
- Where is the Business Now – Find out where you are at this time? Review the business performance as compared to its projections and undertaking a full analysis of every area.
- What are the plans for the future – Put in plans for the future. Here a business plan is designed and drafted, incorporating all that the business wants to achieve for the future.
- Action – Put your plans to work. Your plans are ready, all resources are in place and it is now required that the business commence operations. The owners then have to ensure that the business keeps going well and keeps monitoring the situation to ensure the path it follows is close to that set out right at the beginning.