Does your company have a solid business structure? Are there assets to meet the needs that will be generated? In order for your business to sustain you need to learn to manage the tension caused by facing the growth of your business.
One of the key factors in these forecasts is the increase in consumption. At this point, it is possible that your volume of business, and therefore income, will rise. Perhaps your company is forced to increase its structure and staff. But is it really ready? The growth of your business must be steady and sustainable, based on solid pillars. Otherwise, it could crumble if the foundations and finances are not thought of in advance.
In this article, we will tell you some factors and give you some advice that you should take into account and consider before turning your business infrastructure upside down.
Tips for sustainable business growth
When planning a growth model for your business, it is essential to ensure budget control without sacrificing the quality of the product or service. In addition, the structure of your organization must grow according to your business, no more and no less. Finding this balance is not an easy task.
It is possible that, until now, you have been able to control all the processes of the company. As in many other entrepreneurial experiences, it has been managed by one or a few people. Every worker has a defined role and everyone knows what the rest of his colleagues do. The growth of your business may lead to new needs for specialization or segmentation, so it is necessary to establish a new management structure with different visible heads that ensure the quality of the different procedures.
The responsibilities and duties of each position must be defined in writing and included in an organization chart to create a scalable model, in which it is clear who reports to whom (and how often) and who is responsible for each area. It is a pyramidal structure in which more specialized profiles will be added to the base. You can make use of character counter with spaces for creative business writing.
1. Go for a long term loan
Long term business loans are a viable option when you forecast steady growth in your business. Long term loans can be adjusted to be paid up to a time period of ten years.
2. Implement quality control
Sustaining and maintaining quality is paramount so that the growth of your business is not just temporary and it sustains what has been achieved. A company must ensure that it maintains the quality of its product or service. For this, it is best to establish a quality control system, hold someone responsible for this task and decide which elements are going to be valued within it.
When a company grows, it is not so easy to supervise everyone and it is not clear who is in charge of ensuring that these rules are respected, influencing the quality of a product whose added value was precisely that, its careful process and exclusivity.
By creating quality control, you can assign a manager to oversee processes and ensure that standards are scrupulously followed.
The next step will be to point out to all workers who is responsible and to whom they should report. This structure should grow at the same rate as the rest of the business. In other words, if up to now you had 20 factory employees and a quality manager, if it grows to 40 workers you will need two supervisors and, if it grows to 60, three.
3. Reserve budget items for expenses
If you are experiencing a period of prosperity and growth, it means that your sales are on the right track and that your company is ready to continue advancing. This growth of your business requires the expansion of infrastructures, new workers, and process improvements. In other words, when it grows, money also runs out quickly.
These expenses attributable to growth will surely occur before sales offset that movement, so our advice is that if you are going to undertake a growth process, reserve an expense item first. In addition, it is common for companies to face various unforeseen expenses at this stage, because sometimes even the administrators themselves have not managed companies of this size and have this experience. More reason to reserve some budget.
4. Make cash flow projections several times a year
Growth is also a stage of uncertainty. The faster this is, the more difficult it will be to plan expenses and income in the medium and long term, something necessary to avoid losing control. A growing company requires detailed planning and constant updating of plans since more variables come into play than originally anticipated.
For this reason, cash flow projections are of vital importance in a growth process and, if until now you could review the business or plan projections once a year, now it is advisable to make them several times a year because during that period deviations in sales or expenses can occur.
Because expenses at this stage tend to increase faster than sales, it is necessary to keep abreast of changes in projected cash flow in case cuts in expenses are necessary and thus avoid running out of liquidity.
5. Don’t underestimate tax burdens and customer importance
When a company grows, we can assume that taxes will increase proportionally to sales or profits. Not necessarily. If the company becomes more profitable, you may change your tax regime. Keep this in mind when establishing your business plan and evaluate different scenarios so that growth does not surprise you.
Your customers are a key reason for the growth of your business, so it is important to keep the quality levels of the product and its satisfaction ratios intact or even improve them. Take customer feedback, it depends on you to keep growing. Take their comments and suggestions into account in each review of your business strategy. And above all, maintain the customer base that has brought you here without neglecting their attention.
New technologies allow you to optimize internal processes and operations, reduce costs, improve the experience of your customers and discover new business opportunities. Furthermore, they are a strategic component to be able to compete on equal terms with other companies that have opted for them for their growth. Take advantage of all its potential and make your company grow without losing sight of the future.