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Welcome back everyone. In the sixth and final part of my blog series, I want to discuss something that affects all of our financial journeys: Superannuation. Perhaps you’re concerned about your retirement savings? Or maybe uncertain about how to make the most .....
Growth - 5 min read
Despite the unlikely odds of success, your business has survived those crucial first years. Congratulations! With reliable employees and a healthy customer base, you may feel ready to start pursuing serious growth.
Before you take any steps, however, take a deep breath and realise that many business owners mistakenly equate short-term success with a need to grow. When small businesses grow too quickly, they often run into financial troubles or the need to downsize to avoid failure.
Instead of depending on today’s success to fuel your company’s growth, approach business growth the right way, through careful planning and strategic goals. As you evaluate your path to expansion, keep the following factors in mind.
Before you do anything else, focus on researching your proposed growth. Businesses can take several routes to expansion, including moving into new territories, adopting disruptive technologies, acquiring other firms or offering new services and products.
Each of these growth strategies requires significant investigation. You’ll need hard data to help you understand the following:
In addition to understanding market conditions, you’ll also need to research your own company. Expanding generally means higher costs, at least initially. Is your business in a position to handle those increased expenses? How much additional capital will your growth require? How will expansion affect your cash flow? The answers to these questions will help you as you make your decisions and plan your strategy.
Rapid growth can have a significant impact on your current customer base. If your customers see you as a small business with a personal touch, will they remain loyal if you morph into a larger company with less personal customer service?
Craft your expansion strategy around staying loyal to your current customer base. If they depend on you to deliver products quickly, will your expansion allow you to maintain this priority? Many businesses struggle through growth because they lose touch with their original customer base. Do all you can to retain those essential ties.
Every successful business expansion relies on a carefully constructed strategy. You wouldn’t have started your business without a plan, and you shouldn’t expand without one either. Look down the road a few years and consider where you want to be. Then build a plan to lead your company there.
Unless investors outline your growth, there’s no set timeframe dictating your company’s growth. Therefore, set goals and plans for the years to come, and work diligently toward attaining them. To give you some perspective, a growth rate around 15% per year, while seemingly modest, will ensure that your business doubles within five years. Do you have plans in place to manage such growth?
Growth changes many aspects of a business, from the culture and communication to the experiences of your staff. You can expect your finances to be strained during periods of growth, but you should also expect extra stress on your employees.
To retain your carefully trained staff, prepare them for growth by providing training and development opportunities. If managed well, your growth can improve your employees’ lives and careers while the business becomes larger and more robust.
You’ll probably need to hire more people as your business grows. Try to balance the expanding company’s need for help with the strained finances. You don’t want to overburden your staff and risk burning them out. As you bring on new talent, consider this an opportunity to choose people with skills and competencies in areas that will help you to reach your goals.
Lean on business experts who have guided other companies through periods of expansion. Here at Altus, we can help you craft your growth strategies and work through each step of the journey. Let’s work together to grow your business!
Set your business on the right path with this simple guide.
Make sure you’re on the right track with this online checklist.
© 2022 Altus Financial, All rights reserved.
Altus Wealth Pty Limited ABN 55 649 956 212 is an Authorised Representative of Altus Financial Services Pty Ltd ABN 24 637 026 825 an Australian Financial Services Licensee (AFSL no. 520266). Altus Financial Services Pty Ltd is not responsible for the advice, products and services provided by Altus Accounting. Julie Azzi is a credit representative (CR No. 366834) of BLSSA Pty Ltd ABN 69 117 651 760 (Australian Credit Licence 391237).
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