If your business growth is outpacing your estimates, we first have to say “Well done!” Many company owners struggle to accomplish their growth goals. In fact, 80% of new businesses fail during the first year.
However, not every business crashes and burns because it didn’t grow fast enough. Sometimes a company will grow so rapidly that the executives are not sure how to adequately manage the new growth. This deficient management can cause a thriving business to fail.
How to Manage Rapid Growth
When orders and money are rolling into a business, many executives have the impulse to kick back and relax. But, when things are growing more rapidly than predicted or planned for, it’s time to step up.
Your first action in managing your business’ growth is to take a step back and form a plan. Instead of hiring new employees, purchasing more equipment, or buying a new warehouse willy-nilly, you need to re-evaluate your short and long-term plans.
For example, let’s say you planned to sell 1,000 toy boats this holiday season. However, demand for toy boats skyrocketed, and you got in 100,000 orders. You may have plenty of pre-order money flowing in, but you also now need to deliver 100x more inventory than you planned for.
Now, instead of throwing that newly made money at the problem, it’s time to map out a real plan. You have 100,000 orders over the holidays, true, but this uptick in demand may not be sustainable. In fact, it may just be a holiday rush. So, instead of hiring 100xs the workers to make your boats, get in touch with a temp agency and hiring seasonal workers only.
Next, you will need to train these workers and have equipment for them to use. Again, you aren’t sure this flood of orders is sustainable, so create an accelerated training program and rent the space and equipment on which they can work. This gives you options. If your orders continue to grow, you can hire the temp workers and buy the equipment. But wait until your business growth is sustainable before making long-term plans and promises.
This ordered, planned approach to new, unexpected, growth can seem like more work and perhaps feel less fun and spontaneous than the “let’s use this new money to buy that thing we’ve always wanted” mode. However, creating a sustainable business requires a systematic manner.
You may need additional planning and organizational help through this exciting period. Business Success Consulting Group is here for you. We provide financial, executive, and organizational consulting. Contact us today, and we will give your company a free evaluation.