Business growth is a part of pretty much every business plan, and while it may seem like a universally good thing on the surface, you can’t reap the benefits of expansion without dealing with some of the challenges that come with it. All too often, promising ventures have taken a nose dive thanks to some avoidable mistake that the CEO or another higher-up made along the way. Here are three of the challenges you’ll face while growing your business, and some advice on dealing with them.
Managing Cash Flow and Finances
Good cash flow control is essential for any business, but even more so when the business is growing rapidly. Financial constraints can be one of the biggest factors that limit growth, and this kind of issue has driven countless businesses into the ground in the past. You need to make sure every element of your cash flow is carefully controlled, aiming to maximise free cash flow, and eliminate drains on your money. Stock control and supplier management tend to become a bigger and bigger issue as a business grows. You’ll need to purge any obsolete stock from your possession, work with suppliers to trim down your delivery cycles, or switch to new systems that allow you to handle longer windows between deliveries. Make sure you’re running detailed projections, and making plans for your cash flow before you need them.
Attitude and Skills
While the CEO can be the driving force behind a good business, they’re also frequently the thing that drags down a bad one. You may have had the perfect skill set to launch a business, but these same qualities aren’t going to help all that much when it comes to growing the business. Aside from learning the skills it takes to pilot a growing business, you’ll also need to learn to delegate effectively, or risk spreading yourself too thin. You need to be able to trust people in your management, not to mention a lot of niche, one-off outsourced professionals such as construction solicitors, to take control of some of the factors that had always been directly in your hands. As an operation expands, if a CEO can’t let go of their control, their micromanaging tendencies can sap motivation and creativity from their entire workforce. Letting go of certain tasks can be hard, but it’s essential if you want to see a lot of successful growth.
Finding the Right Systems
All modern businesses depend on massive volumes of information, and it can be very hard to leverage these without the right kind of systems in place. The larger your business becomes, the harder it will be to make sure all that data is accessible, and that different areas of your business can leverage it effectively. This is all before the increased need for set policies and procedures that comes with a growing business. By identifying and investing in all the right systems for organising this information, you’ll benefit massively through much more efficient and effective operations, which will keep you in-step with your new, larger competitors.