Businesses want to grow, of course. Some would say the quicker the better. The problem with shooting for the stars is that you can soon find yourself in difficulty if you don’t have the infrastructure to cope with your success.
The world of business is littered with stories of companies, both big and small, overwhelmed when they hit the right product, throw out a promotion that customers can’t resist or take on a contract that is far too challenging for their capabilities. The truth is that businesses that succeed in today’s competitive world are the ones that grow neither too slow nor too fast and it can be a huge challenge to strike the right balance.
The key is sustained growth and it is the true measure by which success can be measured.
Pitfalls Of Growing Too Quickly
Sustained growth for businesses is the maximum growth that can be achieved without having to become reliant on substantially increasing financial leverage or getting into unmanageable debt. If you have a new product or service coming out you obviously want it to do well. You want people to engage, you want everyone to know your name. Businesses can sometimes anticipate the popularity of a certain product and put measures in place to make certain they can deliver.
On other occasions it can come as a complete surprise or can be misjudged. Other businesses can all too often take on big contracts where they will find delivery difficult but are seduced by a hefty payday and a chance to play in the big pool.
When demand suddenly outstrips supply businesses have a logistical problem. First of all there is the need to push up supply which could entail taking on extra debt to finance it and then there is the issue of having enough staff and the right infrastructure in place that can cope with everything. This is something most businesses have to consider whenever they start a marketing campaign – it’s not just about reaching the right customers but being able to deliver effectively once the orders start coming in.
Pushing for rapid growth comes with some serious health warnings, not least to the brand reputation of a business. If you have a number of clients but one particular contract is taking up all the time of your hardworking staff then your other customers are generally going to suffer.
Damaging Your Reputation
You may have the best product or service in the world but if people are having difficulty buying or accessing it then your reputation is going to plummet quite quickly. Most businesses can cope with a small glitch such as a customer service issue or complaint but when you multiply that several hundred times you start to lose control. Reputational damage is akin to a fatal wound for any business and is difficult to recover from once the adverse brand message is out there.
The Benefits of Sustained Growth
All good things, including businesses, are built on solid foundations and the major benefit of a sustained and realistic growth strategy is that it gives you a clearly defined blueprint for success. That doesn’t mean everything is set in stone! Having a clear business plan and the right infrastructure doesn’t mean that you won’t suddenly find yourself surging forward quicker than you would like. Here are just a few questions you should ask about your business before you commit to that big contract or marketing push:
- Do you have the right level of supply of goods or services?
- Do you have an adequate number of trained staff in place to deal with this sudden increase in business?
- Are you working within your business budget or are you likely to overreach?
It can be a difficult balance to maintain when you are actively looking to grow your business, even more so if you are an old school sales person, who has historically left the order fulfilment as someone else’s problem. Likewise having a sustainable growth plan can embolden the most timid of business leaders, with confidence in your business development plan. Sustainable growth doesn’t mean you don’t take a business risk, nor does it mean you don’t chase after the larger contracts, it simply means that you have all your ducks in a row ready to land that larger account, your plan is flexible enough to cope and instead of being reactive you are proactive with managing client expectations.
The Last Hurdle are business development specialists, we work with our clients across a diverse range of industries to facilitate sustained growth.