Growing too fast is one of those “nice” problems a business can have, but it’s still a challenge for many small businesses enjoying fast-track growth.
There are lots of red flags that indicate your business is stretched to the max. Here are some of the warning signs:
- You’re hearing more customer complaints.
- Your employees are working long hours and they’re cranky.
- You’re working long hours and you’re cranky.
- Providers of inventory and materials have you on perpetual back order.
- The office is crowded, or you’re using temporary storage facilities for inventory.
- Company values have shifted from quality of goods shipped to quantity of goods shipped.
- You’re losing long-time customers.
Growing too quickly presents its own challenges – challenges that are often missed by highly-driven entrepreneurs who started a business to GROW it. That’s why these small business owners work 60 hours a week and love it.
Aggressive business owners may purchase more equipment, hire more staff, move to a larger space, or seek venture capital to finance future growth. But when their plans succeed, they fail to undertake proper planning to meet the challenges of high-speed business growth.
If your business shows any of the above signs that it’s growing too fast, first, congratulations. You have a good problem. Second, you need to set up processes right away to make sure you don’t get so overwhelmed by success that you turn it into failure.
Quantity Versus Quality
A stable customer base depends on the quality of products and services your business delivers. If quality suffers because you’re operating over capacity and don’t take time for quality control, customers are less likely to re-order from you.
Losing customers because of a shift in the quantity/quality equation needs to be addressed quickly. Repeat sales are less costly and easier to create than new sales, and you don’t want to lose loyal customers and have to spend money to look for new ones. Each lost customer costs your business working capital to replace.
A business growing too quickly can also lose quality work time. A stressed-out, overworked staff may be unable to concentrate at the weekly sales meeting, and is unlikely to come up with innovative ideas or make long-range plans.
A workplace that is constantly operating over capacity can provide a fertile ground for conflicts between individuals or teams, frustration that may lead to employee turnover, and a general feeling of discontent. The quality of relations with your staff can be just as important to your company’s success as the quality of your products.
When you start hearing complaints from customers, it’s time to recognize you have a growth challenge on your hands – a challenge to keep the customer satisfied.
Investigate ways to automate some of your processes so you can act more quickly and efficiently. For example, offer ways for customers to order online, use software to generate and email invoices, provide customers with tracking numbers for their shipments so they don’t need to call and ask about delivery dates.
If you do get customer complaints because of back orders or slow service, handle them immediately and apologize without making excuses. Customers don’t care what caused their problem – they just want it fixed. Even if you’re short-staffed, don’t skimp on customer service while you’re growing. Make sure customers have an easy way to contact you – online, over the phone, and in person.
Don’t Go It Alone
As the owner of a fast-track business, step back and take a breath. Consider bringing in a business consultant who can look at your company impartially to identify the challenges you’re facing with too much growth, and suggest ways of handling them.
The Internet, industry-specific groups, and business associations can all be sources of information you can use to deal with problems caused by fast growth. Take advantage of these resources to help grow your business quickly and smartly.
The information provided is presented for general informational purposes only and does not constitute tax, legal or business advice.