Eventually, there will come a time when your small business reaches the limit of what it can do without growing. Small businesses and their growth are an important part of the economy – Forbes reports that they make up more than 65 percent of the net new jobs created since 1995 and that more than half the working population works at a small business.
If you think your business needs to expand, watch for some of these common signs:
You’re Getting Outpaced
One of the indicators that it is time for your business to expand is when the demand for you product or service begins to outpace your ability to supply it. In some cases, this may mean you need to expand your inventory to keep up with demand. Or, it may mean that you need to hire new employees to help with the increased workload.
It’s Too Easy
The inverse of the above problem is that you seem to be doing well with little effort. For some businesses, an untapped market becomes a gold mine and customers seem to be banging down the door. When this happens, it’s important that you think outside of your current model and seize the opportunity. Your golden age won’t last forever, so you should improve your business model while the money is rolling in. Upgrade and prepare your business when times are good so you are still in a good place where you can survive and thrive if the the tides shift.
The Books Are Breaking
One of the biggest indicators that a business needs to grow is when the paperwork becomes a burden to handle. When you reach the point where managing the day-to-day aspects of your business is beyond your abilities, seek out professional help or software like Sage’s ERP solutions to help you streamline your books. But, don’t rush out and hire new employees right away – an MIT study shows that the cost of a new hire is actually 125 percent to 140 percent of his or her base salary. Carefully weigh your potential growth versus the cost of expansion before you commit to hiring new staff. If you’re not sure if you have enough income to hire employees, start by integrating automated software and online solutions to see if that is enough.
You Have No Growth
Ironically, an excellent sign that it is time to expand your business is when your growth is stagnant. Sometimes, it just means that you are in a rut from providing only the same products and services. When things seems to be steady but the same, it is time to think about the future and how you can offer something new to your loyal customers.
In fact, they’ll often be the first to know it is time for you to expand. When customers start asking for services or products you don’t currently offer, it’s time to give the people what they want. Or, if you have the time and means, reach out to your customers to ask them what they would like you to start offering.