Source: Unsplash | LYCS Architecture
Growth is important for businesses, but it brings with it its own challenges. Failed at attempts at development, from new products that don’t find an audience, new branches that can’t attract customers and expansions into new markets that fail all have a heavy financial cost, as well as the potential to damage your reputation – just look at New Coke for an example of a product launch that nearly killed a brand!
The flipside of this is that there’s a risk to successful expansion, as well. The reason many people start businesses is that they have a passion for the industry and want the independence to pursue their passion. Growth has the potential to limit your access to the frontlines of the industry you’re so passionate about: as businesses get bigger they require more guidance, more administration: more management and less action. You can reduce the administrative burden on your shoulders to an extent by hiring managers and executives, and delegating some of your responsibilities to them, but ultimately, you are the final decision maker, and as your business expands so too does the number of decisions you have to make. Eventually, you will have to become a full-time manager if you want your business to survive.
If you enjoy personally running a small, local business then growth might lead to more success and more money, but it will change the character of the business: you won’t know all your staff personally, and you may not see customers or clients from day to day. There’s also a risk that this may not play to your strengths: managing a business requires a very different skillset as it grows, and if you don’t develop your own expertise it could put your growing business in danger which, if you have influential investors or shareholders, could endanger your position!
As part of your business planning, alongside international research to give you a more informed idea about the worldwide demand for your products, and brand tracking to see how your marketing is affecting your brand strength, you need to look at what the future looks like for your business. How big is too big? Are there ways you can develop your business that doesn’t complicate it further?
You might want to consider tactics like adding new products and removing less popular ones, to freshen up your offering without adding more layers of managerial complication to your business. This will allow you to develop your business and stay at cutting edge without your business getting out of your control.