As your business grows, so do the challenges you face. A growing customer base and higher sales present opportunities, as well as problems. Recognising these obstacles which come with growth will allow your business to face them head-on, and develop sound strategies in response to the new requirements of your fast-growing company. Today, we run through common challenges that leaders face as their business booms, and how they can manage the potential pitfalls effectively.
Cash flow is harder to manage
One of the most common problems for growing businesses is managing their cash flow. Business owners tend to spend more during a growth period to meet expansion costs. However, if your company’s spending gets out of control, there can be a shortage of cash that may leave your business in a volatile position.
Make the most of your company’s finances by planning ahead, choosing where to invest wisely, and arranging suitable financing accordingly. It’s vital to control your cash flow even if it means passing up some opportunities.
Higher pressure to compete
It’s natural to upgrade your services in hopes of getting new customers. But when your company grows, your competitors will react to what you’re doing. This is where your business is faced with the realities of tight competition. Focus on your business and find ways to communicate your unique value proposition to your customers. As a growing business, your own experience is more valuable when innovating products and improving your services.
Difficulty keeping up with the market
Market conditions change rapidly. With this in mind, you need to keep your market research efforts consistent. Otherwise, you run the risk of making business decisions that are based on out-of-date information, leading to miscalculations or failure.
Take time to learn and re-learn who your customers are. Know what they want and how they behave, so you can update your market information. When you do this, you ensure that you answer the current market demands, and increase sales.
Failure to delegate tasks
As your business expands, your business will gather larger volumes of information. This includes handling more financial records, regulatory requirements, business contracts, and more. All this can pose a challenge to a small business, as there’s just too much to keep track of without strategic planning and delegation. Staff turnover may increase if there is too much workload for each person.
Trust your team and hire individuals in key positions to manage information systems more effectively. As documentation and procedures become essential, you need people who can implement effective operations and other employment procedures so you can convince your growing customer base that your company can be relied on.
Unwilling to adapt to change
Complacency is a threat to any growing business. It’s never safe to assume that your business will continue to keep being successful as it is. As we mentioned, change is the only constant in business, and it’s best to respond to these changes by planning ahead, taking action, and changing how you operate accordingly.
Revisit your partnerships and change suppliers that can meet your business’s new needs. Renegotiate contracts to take account of the increased volume of orders. Train your employees so they, too, can grow along with your business. Most importantly, keep up with new technologies, so you can manage your growing business much more efficiently.
Grow with Bartercard!
Bartercard is an innovative online platform that allows your business to grow further, and keep up with the challenges of growth. We have offices across New Zealand. By joining Bartercard, your business can transact with other businesses in an expansive network, attract new customers, expand to other locations, and capitalise on your success. Become a member today!