Small Business Tips
Small Business Growing Pains and How to Overcome Them
Starting a small business is never easy, but what’s often even more challenging is growing that business and meeting surging demand. More often than not entrepreneurs will experience some form of growing pains that need to be resolved in order for their business to meet its full potential. With that in mind, let’s take a look a few common pain points that small business owners encounter and how they can overcome them.
Efficiency
As your business grows, it can be difficult to keep up. Suddenly the processes you had in place to manage your day to day activities can be overwhelmed. Often times your organizational tree gets thrown by the wayside in an effort just to keep things rolling. Unfortunately, as your efficiencies fall apart, you could be making crucial mistakes that could not only be cutting into your profits but also potentially jeopardize your trajectory.
The first step in preventing this from happening to you is ensuring that your processes — from manufacturing and assembling to stocking and selling — are scalable. This will allow you to keep the wheels of your business turning regardless of quantity. For example, if you’re working with outside manufacturers and suppliers, it’s also important to know what their capacity is ahead of time. That way, when you come close to topping out at one facility, you can make arrangements to increase production elsewhere without missing a beat. Meanwhile, back at home base, make sure your inventory is organized so you know what’s selling and when it’s time to reorder.
Of course there’s always room for change and improvement so, as your business does pick up, you may want to consider ideas that might further your efficiency. In some cases they may even mean bringing your production in-house. While this is a major investment on your part, it will likely give you better control of the process and provide you the opportunity to increase your margins.
Hiring
Building a great team to help run your business can be a challenge. This is doubly true when you’re trying to grow your core team to meet the demands of business. Beyond the salary constraints that may be an issue for many small business and startups, there’s also the issues of chemistry and collaboration to contend with when bringing new people on board.
First, a word on salary. Even for a business that’s growing, there may not be much room in the budget to spend on extra payroll. Thus many entrepreneurs need to be a bit creative when it comes to enticing candidates. From the types of lifestyle perks you offer to more traditional benefits (e.g. insurance, 401k, etc.) and perhaps even equity/profit sharing, there are many options you can examine for compensating your employees and retaining strong talent.
As for chemistry, it is important to consider the type of culture you want to maintain at your company and do your best to preserve it. This starts with developing a mission statement for your business — something that will motivate you and your team as well as align your values. From there, it’s a matter of interviewing candidates and finding the right mix of skills and personality.
Capital
Finally, one of the top growing pains that businesses encounter is a lack of capital. This isn’t to say that your company is at risk of going under if it doesn’t secure a loan or line of credit, but that you could be passing up a major growth opportunity if you can’t secure some extra funds. Thankfully, this is one issue what’s gotten easier to rectify in recent years.
These days there are plenty of options for raising capital. In addition old standbys like SBA loans there are several online lenders offering installment loans and lines of credit. Alternatively you may consider taking on an outside investor whether via equity crowdfunding or a more traditional route. However, like with hiring new employees, you’ll want to make sure your would-be partner is a good fit for your business and discuss what role (if any) they will play in the day-to-day operations ahead of time.
Growing pains are a normal part of running a successful small business. That said, these challenges are something that need to be considered ahead of time in order to resolve them as quickly as possible when they do arise. Whether your business is struggling to meet its peak efficiency, could use a few new team members, or is in need of some extra capital, following these tips will help you work through your growing pains and move on to bigger and better things.
