Do what’s right for your business, at the right time
When companies grow they should build slow, build sustainably, and don’t neglect to build a strong foundation. Read the full blog to explore things to avoid when expanding your business.
In chasing the ideal of success, SME owners may be tempted to hire en masse, grow unsustainably, chase funding, and over-commit their time. However, without the proper foundation to carry the weight of these big expansions - money is wasted. Let’s explore the “Don’ts” of early expansion and maybe even suggest a way forward.
Don’t hire people, just to hire people
Long has it been considered good to judge the growth of an SME by looking at how many new hires have been onboarded in their financial year. However, hiring many people, instead of being an indicator of success, can be a sign of daily operational, capital, or leadership inefficiencies. Ask yourself - are these new hires absolutely necessary? If not, then don’t do it. Rather, dedicate funds to upskilling the staff you currently have, empowering them to take on more responsibility.
Periods of rapid hiring are often followed by a period of retrenchment, as companies realise that the outgoing costs outweigh the incoming value. Don’t be afraid to go slow and build off a strong foundation.
Don’t seek rapid growth before your time
The ability to boast an exponential growth percentage feels great. However, what is the practical, on-the-ground meaning of this statement?
Expanding a business costs money. Hiring new personnel, getting more office space, purchasing more equipment. These are elements that need to be in place before expanding. Do not rush to expand. Develop your foundation so that it can withstand growth first.
Don’t waste your time
If you believe 18-hour days puts more money in the bank, then you need to ask - who is paying for your time? With no weekends off, and no downtime, you are not ‘hustling’ but rather have built an unsustainable business model. Putting in extra hours should be the exception, not the rule.
With the right business plan in place, standard business hours are enough. Rethink how much work you take on, or how much staff you have relative to the work. Ask yourself if you are charging your customers fairly for your time and, if needed, charge them more. Great products, or services, cost money - this is a universal truth.
Don’t recklessly chase funding
Securing funding leads to future success in a scalable business. But, for SMEs without solid foundations, funding is a slippery slope. With great funding comes great responsibility. More money, more problems.
Acquiring funding does not solve underlying problems in your business. It will instead, quickly expose them. With profit as the goal, you will lose money and disappoint investors if your business is not ready. Taking your time to develop is your strength, not your weakness.
Do build a solid foundation
A strong foundation in business is built with a distinct vision, strong leadership, capable management, efficient operations, potent marketing and sales, careful money management, and a dedicated working culture.
A solid business plan casts a solid foundation. Make it adaptable and able to navigate the shifting business environment. A rigid business plan is a great place to start. But as your business grows, the core concept can remain, but the details must change. Be flexible and innovative.
There is nothing wrong with slowly building your business. Actually, it is preferable, as it is more sustainable long term. The great and grand things that are destined for you, will happen. Your job is to build an indomitable foundation, able to support the weight of this success.