As soon as the dust settles on your grand opening, begin laying the foundation for future expansion.
Get Ready, Set … Grow!
Set aside some time to plan for your company's future growth.
Who dares to launch a business in the midst of a pandemic? A whole bunch of optimistic people, apparently. As coronavirus swept across the U.S. in 2020, new small business applications nationwide jumped by more than 24%, the highest-ever single-year increase on record.
We’re guessing that almost no one who submitted one of those new small business applications is planning to fail, but sadly, according to the U.S. Small Business Administration, many will — at the rate of 20% in their first year, 50% by their fifth. But here’s an interesting fact to consider: It likely will not be lack of money that takes a firm down, but rather the owner’s failure to plan ahead.
As you work through all the details of just getting your new business off the ground, you may be tempted to push aside thoughts about your future. Instead, as you work through the early stages of small business ownership, set aside some time to plan for your company’s future growth by answering these questions: Where do I see my business a year from now? In five years? In 10 years? What steps will I take to get there?
Commit your answers to paper and add notes to them periodically. Then, when you are seriously ready to expand, you’ll have a blueprint to follow. The sooner you begin asking — and answering — these questions, the greater the odds your business won’t be among the 50% that do not survive beyond five years.
Plan to expand … before you absolutely must
Don’t wait until you’re running out of room or resources to think about growing your business. As soon as the dust settles on your grand opening, begin laying the foundation for future expansion. Here are five steps to get you started:
- Revisit your business plan periodically. Look carefully at the plan you opened with. What new goals/ideas come to mind as a result? Which supporting documents need to be updated? Have you realized your expectations, and if not, why not? What steps will you take to get back on track?
- Fine tune your operations. Is your business operating at peak efficiency? Do you have the necessary tools/space to meet current and future needs? If the answer is no, what else do you need and how will you pay for it?
- Rate your team. Have you prepared written job descriptions for all positions and have the right people in place? How effective are your training programs? Do you have a strategy for attracting/hiring new personnel? Are you adding new job descriptions and revising existing ones as needed?
- Enlarge your market. Are you reaching all possible markets for your product or service? Is your marketing budget adequate and are your promotional strategies working? If not, what adjustments will you make?
- Assess your financial fitness. Have you reached your breakeven point? What’s your cash flow situation? Can you afford to expand? If not, what measures will you take now to make expansion financially possible on some future date.