As a general rule start-ups, and many established businesses as well, are in business because they want to grow. They want to be successful. But before you jump the gun and push for rapid expansion before you’re ready (because that’s a sure-fire way to fail), you need to ask yourself some questions. We’ve done the hard work for you and figured out what those questions are (hey, we were a start-up once). So, if you think you’re ready, then objectively ask yourself the following:
Have you got the demand?
And by this we don’t mean ‘Are you pushing the bejesus out of your product?’ No, we mean do you have an organically growing customer base? Do you have customers coming to you, regularly, because they have heard you are great at what you do? Do you hear people talking about your business and saying things like, ‘God, I wish we’d found them sooner!’. Are you on the verge of not having enough product to supply your demand? Yes? That’s a good start.
Have you got a solid team?
You have to start with good solid leaders. Not just people that tell other people what to do. We generally don’t use the word leader for them. No, a leader is someone who inspires the rest of the team to do the best they can; someone who makes their success feel like everyone’s success. But General’s don’t win wars by themselves. They need a team they trust. Soldiers that will execute the plan, and get it right. It’s important to know the difference between a friend and an employee, and if you can’t draw that line, you probably need to rethink your structure.
You aren’t just riding a trend wave
This is a tricky one. You might have people trying to kick your door down because they want what you’re selling so bad. One of the worst mistakes you can make is to rapidly expand only to have the next big thing come along leaving you with all sorts of hefty new expenses. One of the best ways to determine if this could happen is to take an objective view of your business. Do some research. Why are you experiencing growth? Are these long term customers, or just one timers? Are your competitors seeing the same surge in business?
Have you got good relationships with your suppliers?
Are they ready to take on your new surge of business? You don’t want to be leaving customers unfulfilled because you’re having supplier issues. Your customers won’t blame your supplier. They’ll blame you. Make sure your supply chain is ready to handle the extra load.
Do you have the ability to scale?
Can you realistically handle the increased workload without a bunch of new hires? We’re not saying don’t hire to grow, of course if you’re growing you might need more staff. But you don’t need superfluous staff. People who fill one role, and don’t have the workload to fill a day. They’re a waste of resources, and if you’re growing you don’t want to waste resources.
Are you an expert?
Do you know your field? We mean really know it. Backwards and forwards. Are you somebodies ‘person’? You know, the connection they go to when they tell their colleagues ‘Oh, I have a person for that’. Cement your status as a leader, a mover-and-shaker, an innovator.
Do you have the working capital to actually do it?
Are you still scraping by, customer to customer? Relying on each and every one to keep the lights on? If you are not financially ready you’re probably not ready to take the next step. Every growing business needs an injection of working capital. Ideally you have some of your own and use finance to give you the boost, not create the foundations. Making a decision on the right kind of finance for your business can be difficult, check out here (link some other blog here) for some advice.
If you can comfortably tick off these things on the list (and be honest about it, kidding yourself is really only going to damage your brand), then you sound like you’re ready to take that next step. If you can’t then you’re not. Don’t jump the gun, you’ll live to regret it.