Most business owners start a business because they love what they do, not because they love marketing, business models, etc. But, if you don't plan for growth, now, it can create a number of problems later. If you wait until you start growing before you plan for growth, it's easy to feel overwhelmed and unsure about what to do next. That's not a great feeling.
It's important to know what factors drive demand so you can predict it. This will help you ensure that you have the right team in place to handle it, and you are investing wisely. Most small business owners don't usually spend a lot of time thinking about their business market plans and models. It's not the sexy part of the job, but an important one.
A detailed understanding of the business model doesn't mean having piles of spreadsheets. It requires you to know four key areas when running a small business, and it is important for knowing how the business can grow. First ,it is important to know how and why you delight your customers. Are there any who are more valuable than others? Second, how you create value for them. What makes you special? Third, it's also important to know how you deliver that value. What does it cost you? Lastly and less sexy, it's important to know how you realize your profits. This is numbers part. Sorry, but there's no way around that.
Did you know that 1/2 of small business don't have one? Having a business plan is very important when running a small business. Having a business plan is a great way to document your business model. It's also critically important for loan applications and funding. It's often overlooked, but having one makes you twice as likely to be successful than not having one.
It's not just important to know how you drive sales, but also the cost it takes to service it. If an increase in sales causes you to spend a lot more, accelerating growth can lead to decreasing profits.
This last point is key, and it's the scariest part. When you plan for growth, you often must spend the money before you see the reward. Investing wisely in people, business processes, and business systems can ensure that you have the right people in the right roles at the right time. It can also ensure that you are efficiently driving sales so it leads to growing profits.
This last point is key, and it's the scariest part. When you plan for growth, you often--but not always -- must spend the money before you see the reward. Investing wisely in people, business processes, and business systems can ensure that you have the right people in the right roles at the right time. It can also ensure that you are efficiently driving sales, so it leads to growing profits. Taking the time to plan for growth is worth the effort.
Brian Cairns, CEO of Prostrategix Consulting. Over 25 years of business experience as a corporate executive, entrepreneur, and small business owner. For more information, please visit my LinkedIn profile