How do you know if you’re ready to expand your business? Ask yourself if you are ready for growth, if your company is ready for growth, and if the market is ready for growth.
It starts with the owners’ goals. Are they willing to commit the time and energy for growth? Will growth achieve their purpose for your company? Some owners would prefer to reap cash from current operations rather than invest that cash and their time into growth.
Next, consider whether your company is ready for growth. Is the company handling its current volumes well? If you can’t handle your current volumes, then growth is just going to compound your problems. Are there resources or processes you need in place before you start growing? Your staff will have little time for process improvement when growth begins. Once you commit to growth, it will consume the company.
Finally, is your market ready for growth? You can pick a sales channel or section of the market to test price or product changes. You can get qualitative and quantitative information from market research and testing. Also, consider whether the economy will support your future growth.
Profitable growth comes when the company and the market are ready for it.
CFO Perspective Resources
The Five Stages of Small Business Growth on Harvard Business Review
Get all the CFO Perspective resources with a FAST (Finance and Strategy Toolkit) membership.