Grow your business

How to grow your business –  Avoid these 5 common mistakes

In Advice and tips by Caroline

For many businesses achieving those initial goals is a huge achievement. According to the 2017 report from the Department for Business, Innovation & Skills, the total business population has increased 4% (197,000 new businesses) since 2016 and 80% of all SMEs interviewed by market researcher BDRC Continental, are profitable. Therefore the next question for many is ‘so what’s next?’. Ultimately for any business, it’s about sustainable growth that doesn’t somehow disrupt other areas of the business. Growth executed the wrong way is not a course of action anyone wants to take. But actually it is always a real possibility – whether you’re too cautious and plodding along at a steady incremental growth and miss a massive opportunity or you grow too quickly and leave some of the existing clients behind or unhappy. We try to look at the pitfalls and give some business growth tips. `

“Growth for the sake of growth is the ideology of the cancer cell.” Edward Abbey, American Author, and Environmental Advocate

Accepting new clients that you aren’t resourced to service

Have a strategy for growth is an imperative. Make sure that whatever business you are taking on you can deliver against client expectations without letting down your existing customers. If you have a business development team, ensure you are working closely together to target the kind of growth you want and ensure you can deliver. A common mistake is to sell your business via a pitch or business development team and never actually explain that this isn’t the day to day team that will work with the client. Rapid growth and disappointed clients don’t mix.

Rapid recruitment

Linked to the previous point is the tendency to over-hire when you are in a growth phase. This is all about balance. Hiring more people will help to alleviate stress and space to focus, but it can have it’s pitfalls too. New recruits take investment in time and also increase your overheads. The transition and onboarding of a new team member can have a negative effect on productivity, so timing and finding the right people is key. Do your homework, ensure you know the skill set and attitude you need to help you.

Opening new locations

This is one of the most costly growth tactics – opening new offices or locations in order to spread your reach. Whilst some industries can be easily transitioned to new locations, for others it will be vital to understand the market and potential. Over the last few years we have seen a boom and then bust when it comes to many high street brands. Carluccio’s and Jamie’s Italian both saw a rapid growth phase in the last few years, both of which have since announced closures. Doing your due diligence in financial and market planning will be vital to your success. Get some advice on the economy, do your research and really understand whether your format is transferable to new locations before you invest in bricks and mortar.

Financial planning

You can’t grow any business without adequate financial resources. It’s important to understand your financial position, cash and borrowing powerfully. Before you embark on any growth strategy having the basics right is essential. Have a review and ensure you are controlling your costs, invoicing on time, collecting what is owed and paying your taxes. If you haven’t already done so, it may be time to appoint some financial support to help you interpret your current position, forecast trends and review your strategy to ensure you are optimised for growing the business.

Barnett Ravenscroft has over 40 years experience in helping businesses navigate through periods of growth and financial planning. Let us help you to exceed your business ambitions. Get in touch.