Many small business owners think of “success” and “growth” as synonymous. But this can be an overly simplified way of looking at things, and growth just for the sake of growth isn’t always a good thing. It’s important to be extremely thoughtful when deciding whether it’s time to grow your small business.
“Growing pains” are expected when a brand expands, but sometimes the problems are more than that. Poorly timed or poorly conceived growth can be a significant setback for—or even the end of—a once-thriving company.
There are plenty of ways growth can negatively affect a small business. Sometimes, factors integral to success pre-expansion simply don’t exist in new areas of growth. Small business owners, their staff, and their capabilities can become overwhelmed by increasing demands, which can hurt consistency, quality, and service. Money may be diverted from a successful part of the enterprise to cover shortfalls in other areas.
Remember, there are a number of ways to define “success” as a small business operator. And there other ways to improve profitability and increase satisfaction for yourself, your employees, and your customers or clients besides growth. Of course, none of this is to say that expansion isn’t often a positive step; it is. Just be sure that it’s time to grow your small business when you take the leap; below are some important questions to ask yourself to help you decide.
Questions to Ask Before Expanding Your Small Business
- What are the potential rewards from the growth you envision?
- Will you miss out on a major opportunity if you don’t pursue this expansion?
- Can you achieve more with what you already have, without expanding?
- Is it already a struggle to meet existing demand?
- Are you (and your family) ready for the increased stress and new demands on your time?
- Have you created a detailed business plan for this expansion?
- Has meaningful research confirmed enough consumer demand to support this growth?
- Will you need any new licenses, and if so, how long will it take and how much will it cost too get them?
- Do you have the right location if you’re expanding with another brick-and-mortar element?
- Will your new projected profits more than cover your new overhead expenses?
- How will you guarantee that your existing customers or clients don’t see reduced consistency, quality, or service?
- How will you guarantee consistency, quality, and service in these new areas?
- Do you have adequate staff to handle the expansion, or the ability to quickly hire and train them?
- Can your existing processes and systems handle this growth, or can you easily acquire new tools and scale your capabilities to handle it?
- Do you have appropriate people to delegate new responsibilities to?
- Who will cover your normal responsibilities while you focus on the expansion?
- Can you invest in this growth without putting your small business in jeopardy?
- Do you have enough cash on hand to survive personally and professionally until your new endeavors become cash-flow positive?
- Will you need more office space, and can you afford it?
- How will this growth affect your sales and marketing needs and budget?
- Are you opening your brand up to new competitors with this expansion, and if so, why are you well positioned to take from their market share?
