4 Tactics to Handle the Unexpected Rapid Growth of a Small Business
Business growth is the ultimate goal, yes, but when it happens rapidly and unexpectedly, it can be devastating. Let's explore some reliable tactics you can apply in order to cope with the sudden growth of your business.
Let’s admit one thing right off the bat: the main reason most of us go into business is to grow.
Does anyone become an entrepreneur to stay the same?
And bearing in mind all of those statistics used to scare small business owners with the number of companies that fail each year, we can spend a pleasant afternoon theorising about why they don’t make it.
Part of the reason, or at least that’s my firm belief, is that they fail to expect growth. Once it happens, they fail to work with it and to make the most of it.
Despite the fact that growth is what we are all aiming for, it can still surprise us, catch us in the middle of a good night’s sleep, and shake us enough for us to lose our heads – and our businesses.
Let’s explore some of the tactics you can implement to cope with the (un)expected growth of your small business, and come out the other side smiling, though battered and bruised.
1. Have a growth strategy
Speaking of unexpected growth, let’s discuss what that means for a second, shall we?
Every business on this good Earth should expect to grow. If you do a good job providing the goods or services you provide and give your best in every department, there’s no reason not to grow.
True, this growth comes at a cost: there will be refusals, rejections, dejections, and a lot of good honest work, but that should be what you expect to get. If it’s not, you might want to reconsider going into business.
I honestly believe no growth should be unexpected. Its timing and its scale and sheer speed might surprise you, but the action itself should be expected, planned, and prepared for.
Think of yourself like a Doomsday Prepper – you know it’s coming, you are just unsure about the cloak it will disguise itself in.
A business that aims to be here in years to come needs to define its own growth objective and prepare a growth strategy it can rely on when the Doom comes knocking on your door.
Every business will have a completely different strategy, but they will all need to include the following:
- Business objective
- Five-year plan
- List of risks
- List of opportunities
- List of your internal resources (including funds, people, skills, equipment, etc.) and how they fit together
- Market analysis
- Competitor analysis
- Analysis of your distribution channels
- Target market analysis
- Cash flow overview
All of these factors need to be regularly tracked and updated. There is no point in having a strategy if you can’t or won’t rely on it when the time comes.
True, you will not be right about everything, and things might explode all at once. An influencer might share a Story about you, and you can suddenly be faced with thousands of orders overnight. However, when that does happen, you need to know already what the next steps should be, so you’re not groping blindly in the dark.
Success is supposed to be fun, not scary.
Plan for the financial implications of said growth
When success does happen, the one thing you need to keep an eye on are your finances.
Rapid growth can often have a negative impact on your cash flow, however ludicrous that might sound.
You need to have a plan and a budget for things that have not yet happened. What if you suddenly need to order extra materials? Hire extra people?
Know exactly how much this is going to cost you, and where the funding for this new expense will come. You can’t expect the orders you are yet to fill to fund this requirement, so being ready is key. It’s best to do your research on business expansion finance beforehand, get to know all the financing options available to you, and keep them on your radar.
2. Focus on your best clients
We’ve all worked with clients who are simply nothing more than a pain, and more hassle than they’re worth. Yet we do have to work with them sometimes and learn how to do that with the least amount of stress involved.
However, what we should not aim to do is serve everyone that walks through our doors.
When going through an expansion, businesses tend to try and please everyone, just to get business that can sustain their growth through the door. Yet a lot of this business is not sustainable, not worth the effort, and simply not a match.
This is often done by focusing too much on the wrong product or service that does not bring in the type of customers we’re looking to attract.
When going through a growth phase, make sure you don’t base it on all the wrong people. Use this time to cut out all the clients you don’t need, as well as the products or services you no longer require, as you move on to the next stage of your business cycle.
3. Be careful who you hire
The most important resource any business has are its people.
These people also include you – remember that.
When growth happens, chances are you will need to bring new people on board. This is a time of turbulence in terms of human resources, and it can cripple your progress.
When looking to expand, make sure you take into consideration the people you are already working with, and what new employees need to bring to the table.
Are you looking for someone who does the exact same thing as people already there? In that case, what kind of personality would fit in best?
Is there a certain lack you’ve noticed, and are now looking for a new set of skills? How will those skills match the ones you already have, and why?
Managing others is likely the most challenging aspect of running a business, and if you get that right, everything else should fall into place.
Just imagine the difference between working with a highly motivated team, versus having ten procrastinators on your hands.
4. Find a mentor
Every entrepreneur on the planet should have a mentor.
There’s someone out there who has gone through what you’re going through, and who can help you avoid the mistakes they have made.
After all, being a good leader is about lifelong learning and expanding your skillset further than you have ever imagined. Having someone in your corner to help you achieve that can be an incredible asset.
You can find a mentor to coach you on doing business and dealing with clients, or perfecting your craft, be it baking cakes or building houses. And you ideally need both – a business mentor and an industry mentor – to take your skills to the next level.
Even when expected and highly desired, growth can be a challenge. After all, stepping out of your comfort zone is never easy or pleasant.
But adapting will be much easier if you manage to overcome the unpleasantness and trust that you’ve gotten to the point of growth on your own merit. Learn to accept growth, not as something that has happened to you, but rather something that has been caused by you.
Just ask yourself: what would the best version of yourself do in the given situation? As you’ll quickly notice, the answer will provide more clarity than you could have dreamed of.