Don’t let doubt stop you from growing your business
We all have moments of doubt from time to time. As business leaders, we have to push through them and believe in ourselves. As if this wasn’t hard enough, we have to learn how to believe in ourselves when we are feeling at our most alone and vulnerable. In amongst that noise, we then have to be able to recognise when we are the very factor that is holding back the company’s growth! The only way to do this is to commit to growing your business by making the changes necessary whilst maintaining our self-belief! The changes that need to be made are often a result of where the business is in terms of its development. There are four stages to the business lifecycle:
The start-up in survival mode
So you’ve started the business and are trying to hang on. It is all about every possible opportunity to gain customers and get a basic income. You are ‘pump priming’ the business with cash and if the money doesn’t run out, the business begins to grow. The growth however can be haphazard. Sometimes because you are just trying to do some business with someone, you can end up being pulled off track and delivering services or products other than those that you set out to do. The business lacks structure and is very much shaped by what happens to it. However, it is work and the owner is ‘getting by.’
Sometimes, the business is enough, and the owner is happily ‘getting by,’ but for those who wish for more often realise after a couple of years that they want to do and achieve more and think about growing your business. It is time for the owner to ask themselves “Is this ‘work’, or is this a ‘business’?” To turn it in to a ‘business’, there needs to be some investment into structure, organisation and narrowing down the products or services.
It’s all about the lifestyle
You’ve now invested in marketing, you have a sensible structure and you have assembled a small team of great folk around you. You’re making some money and it is a great place to work! Or so it was for a few years! Everything is still OK, but you are now noticing that things have a tendency to slow down when you’re away, or that the team are constantly calling you on holiday for decisions. You seem to be the only person to be able to talk with your main customers. And they always want some sort of special deal that only you can deliver! You are getting close to capacity that you can achieve even with overtime, and you are starting to see opportunities passing you by as a result. Worse still, the pressure on the team is getting such that a couple of your best people have left and that has meant that the rest have had to pick up the slack!
It is time for another change! The business owner must now ask themselves, “do I want to live with these levels of stress? Should I just scale back and accept fewer orders? It is profitable for me to be involved in the day to day – am I willing to give that up?” This is the OWNER’s TRAP! I can’t meet the demand. There’s no time for myself. I can’t bring on specialists because they cost too much, and I don’t want to lose profitability. The only way out is to put in place a management team that will do the work and report to the owner.
The Scalable Business
There are really good reasons that 95% of businesses don’t make this leap and continue to bump along as ‘lifestyle’ businesses. This is the stage where substantial changes need to be made in order to allow you to start growing your business and allowing it to thrive. This is about allowing you the freedom to operate how you want to in the business. This does mean change. A competent and professional management team must be put into place – which some owners find difficult as it means handing over the reins and ceding control over the day-to-day. It also may mean changing the faces in the business. The co-founder’s aunt who did the books has to be replaced with a proper dedicated bookkeeper. A proper sales-team must be put into place. Not only will these changes be painful, but they will be expensive too! There will be new salaries to pay and no extra sales to cover them at the beginning at least! Often the founders of the business will miss being the centre of everything!
The Sellable Business
Time waits for no one. We all get older, slow down, and want to relax a bit. Sooner or later, every business owner must face a decision about what is to happen with the business. The clearer and more thought-through this is, the easier and more deliberate the transition will be. The choices that business owners make here are varied. Some will simply sell up the business for a cash sum which they will use to fund their retirement. In this case one hopes that they have done everything in their power to maximise the intrinsic value of the business. Some might want to ‘promote’ themselves to Chairman and appoint a CEO and board to run the company (sometimes family), or act as a non-executive director.
This is the one inevitability of business ownership, and you must make provision for what will happen after you. And how ‘new blood’ will be brought into the company to ensure that it continues to thrive into the future.
Whichever stage you are at in your business journey, I can help you with the transition to the next. I offer business advice and support in the Hereford area. For more information, or to book a free Business Health Check, please have a look at my website here.