Don’t Measure Your Business Success by Growth Alone
As an entrepreneur, you put a lot of effort into your business growing. It’s rewarding to know that people value your services. This validates that your service fills a need.
More clients and more money are signs of success. Actually, most entrepreneurs place higher value on serving their clients than solely making money. So you’ll want to figure out the sweet spot for you and your business. How big do you want to grow?Figure out the sweet spot for you and your business. How big do you want to grow? #getpaidwhatyoureworth Click To Tweet
Growth places new demands on you and your business. As a result, you’ll need to modify and upgrade your systems so everything continues to run smoothly. Plus, your stress lowers when everything operates smoothly.
The side effects of your business growing:
- Growth adds complexity. More clients mean more work. As a result, breakdowns and bottlenecks will start to appear. Notice where they exist. Then figure out the best way to resolve those issues.
- You hit a scalability wall. There are only so many hours you can work each day and week, and so many projects you can manage. Is your business growing and you feel stretched too thin? If so, then it’s time to re-evaluate everything. Either you can grow your team or you can scale back on the services you offer.
- The cost of growing your business. Your expenses increase as your business grows. A growth phase, however, typically reduces your profits. Realize you may spend more money in the short term to make more money in the future.
- A costly oversight. You ignore profitability for the sake of growth. Don’t stretch your finances too thin. Realize that things rarely go as planned. Talk with your bookkeeper about setting up a reserves account to recover from any unexpected setbacks.
Growth keeps your business relevant in a constantly changing market. Your business growing without a strategy is like turning a blind eye on an issue that needs your attention.
By the way, many well-meaning people will offer their opinion. Don’t let external pressure cause your business to stray from your vision. Remember, the decision is yours to make.
Is Your Business Growing Too Quickly?
Uncontrolled, and even rapid, growth may create a new set of problems. Some businesses self-destruct because their infrastructure can’t handle the growth. You’ve dedicated too much time and energy to allow this to happen to you.Your business growing without a strategy is like turning a blind eye on an issue that needs your attention. #getpaidwhatyoureworth Click To Tweet
Here are some problems that occur when your business grows too quickly.
- Finances. If you borrow to fund your expansion, one unpaid invoice, losing a major client, or a sudden decline can leave your business vulnerable. Calculate how much debt you can handle. Even when your business slows down, you’re still expected to pay your monthly bills.
- Team building. Don’t simply hire someone because you need a spot filled. Carefully consider who you add to your team. Aim for people who believe in your mission and share your values.
- Service delivery. Growth is limited when you’re the only one who can serve your clients. Re-evaluate where you can lighten your work load. Can a private service be turned into a group service? Maybe some of your work can be delegated to an assistant.
- System upgrade. You ignore bottlenecks and inefficiency. These issues eventually breakdown once they’re stressed to the max. It’s less costly to resolve these issues early on than to lose highly valued clients.
Business growth requires you to gradually shift your role from technician to leader.
Size Isn’t Always the Best Solution
Growth is risky business. With a strategic growth plan, it’s possible to reduce your risk. Or you may decide not to grow beyond your current capacity.
Sometimes a well managed small business is more profitable than a larger one. Get brutally honest with what you want. Set aside time to take a good hard look at your business profitability, your vision and your resources.
Answer these questions about your growing business:
- What’s the right size for your business? How big do you want to get?
- Is your business growing in the right direction?
- Are you ready to grow and lead a team?
- Where do you need help? Can team members do what you do?
- Are you comfortable training others?
- What do you plan to do with your profits? Reinvest, dividends, pay off debt or charitable giving are options.
- Are you willing to invest profits in infrastructure like staff, outsourcing, training, upgrades, and expansion?
- How will your business affect your lifestyle?
Decide what you want for yourself and your business. Is your business growth a challenge for you? Do you want to uplevel your lifestyle? Do you want both?
Find Your Business Sweet Spot
Determine your business sweet spot. That is the point where your business size is ideal and brings in ongoing profitable revenue.
First, find your breakeven point to avoid creating debt. Figure out how much money you need to bring in each month to cover all your expenses. Then any revenue you receive over your breakeven mark becomes profit.
Aim for Profits Before Growth
When you discover the sweet spot for your business, you then control the destiny of your business. Review your current business numbers, determine the ideal profitable size for your business, eliminate unnecessary expenses, and concentrate on delivering value to your clients.
Your clients come to you for answers. But where do you go when you have questions? Are you seeking answers to your questions? Business coaching reduces frustration, avoids costly mistakes and saves precious time.
You may decide that smaller is better. That’s because you prefer a profitable business that is less complex and manageable.
Or you decide that you want to go big. If this is you, then the challenge of adapting to new demands is rewarding.
Is your business growing according to your strategic plan? Set priorities that improves the client experience and leads to profitability. Let’s discuss what you want and how to achieve those results. Get empowered instead of feeling powerless. Schedule a complimentary strategy session. Then grow your business with confidence.