Did you know that businesses fail? Of course you did, but you may not be aware of the figure. Forbes has it at 80%, or eight out of ten, whereas Entrepreneur reports there is a 70% chance of failure over ten years. The first thing to say is wow; they are some frightening figures. So, thank the lucky stars that you’re in a position to scale up rather than downsize. After all, these stats suggest the majority of startups don’t last longer than five years.
You can’t sit around and look to the heavens for the foreseeable future, though. At some point, you’re going to have to get to the bit where you grow. It’s the only way to stave off failure and ensure success. However, there is an issue – expansion sometimes leads to big troubles. As SMEs morph into butterflies, they collapse under the weight of expectations.
So, if the business is going to take the leap, it needs to do things the right way. Otherwise, it may become another statistic. To help, here are five methods which should set you off on the right path.
Everyone can think big. Take right now for example. Are you picturing yourself rubbing shoulders with the tech giants of the world? Oh, look, there are Bill Gates and Jeff Bezos enjoying a drink. Is Zuckerberg playing tennis?! The point is that your imagination is vivid and most people aren’t limited in their heads. The inhibitions start when reality dawns. The key is to bring the two together in a way that isn’t precarious or irrational. For instance, come up with a goal that the business wants to achieve. It may be something as simple as converting $500,000 cash flow into $50mn. Once you have it in mind, you need to take action. Try and negotiate deals that will add to sales and revenue, and look for partners with bulletproof contacts. Too many entrepreneurs think big yet fail to act.
SME owners struggle to see the distinction. As a former employee, there’s a temptation to do things which seem important but aren’t in the grand scheme of things. As weird as it sounds, some bosses answer phones and do other general admin stuff. Granted, this is good for morale, but how people perceive you isn’t as important as being an efficient worker. What you need to do is target the areas of the company where your expertise can bridge gaps and limit failure. It may be in marketing, but it may also be in liaising with peers and networking. Scheduling meetings and sending emails never seems productive yet it can be the difference between success and failure. You have employees so let do their job and you do yours.
For the expansion to work, the target base and beyond are going to have to be on board. Sadly, the competition is fierce so they may go with a rival. You can’t let this happen because new customers are the lifeblood of the organisation. Without them, the expansion will stutter. Building a brand isn’t simple yet it is easier than before thanks to tech. A website is a basic marketing tool that is available to everyone at the click of a button. Make sure it looks good, is fast, and encourages conversions with strong calls to action. Going into business with web development companies is another savvy move, too. By developing an app, you can raise awareness through Google Play and the App Store which are two huge platforms. Plus, mobile-friendly companies are all the rage as there are 3 billion people with access to the internet.
Very few billion-dollar businesses are self-funded. To accumulate, you have to speculate and startups don’t have the finance in the very beginning. In this respect, your company is the same as Facebook, Microsoft or Apple. How do you take the next step? You need to find money, such as a bank loan for example. However, there is a safe way to do things and it involves hiring an advisor. Financial experts will guide you through the options and the pros and cons for the firm. By taking them onboard and following professional advice, you can avoid the horror stories. We all know people who took out a loan, couldn’t pay it back and lost their home. So, get one on your team ASAP.
There they are – the four tips that can make or break an expansion. Which piece of advice are you going to use to kick-start the process?
CEO and Founder at Mighty Shouts.
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