— February 8, 2018
The months, even years, after launching a small business can be uneven, unpredictable and slow.
But that could change — fast. Suddenly, you have more customers, more demand, more revenue. Your business is taking off.
This is great news, of course. But a rapidly growing business also means new challenges for you as an entrepreneur. You now need an updated game plan and new ways of operating.
Here are four important changes that you’ll probably have to consider:
1. You need to hire more people
This is the most pressing need when your business takes off.
You probably started out as a one-man show, taking on multiple responsibilities, from accounting, sales to marketing. Then you bring in a few more people to help run the show.
When your business takes off, you’ll have to take hiring even more seriously. You need to figure out how many employees you need to meet current and future demand.
This can be a tricky balancing act. You need to find the right pace of growth. If you hire too fast, you could end up with a bloated organization that your business cannot sustain. If you don’t hire fast enough, you won’t be able to keep pace with your growth.
The key is to develop a deep understanding of your business and your market. You also have to focus more on specific functions, such as marketing, customer support and finance.
2. You may need to change your corporate structure
As you hire more people, you may also need to change your corporate structure. This means changing the way your company is legally structured in order to meet the demands of your business.
Your business may be structured today as sole proprietorship or general partnership, but you may consider becoming an LLC or a corporation. Some things to take into account include taxes, liability, contracts, and intellectual property.
Now, the legal stuff may seem tedious and unexciting. But they’re important. Many business owners make the mistake of not paying enough attention to these matters. In fact, it’s smart to get proper legal representation and advice, especially when your business is growing fast and expanding into new markets.
3. You need to rethink your finances
How you deal with your finances is another area that will change when your business takes off.
You probably started out by using your savings, money from friends and family or a credit card. Now is the time to consider other types of financing, including a bank loan or a business line of credit.
Most people would agree that, as a consumer, debt is something you try to avoid as much as possible.
However, that’s not the case for a business. For entrepreneurs, debt is a tool.
If you manage it well, you can use debt to grow your business. When your business is growing fast, debt can help you take on more and bigger customers, or expand into new markets.
You could alternatively raise capital from investors in form of equity, but that would dilute your ownership. Debt financing, if managed wisely, is the smart way to grow and scale without giving away a part of your business.
4. You now must have a long-term plan
When you’re just starting out, you’re mainly concerned about the coming month, the coming week or even the day ahead. Did you do a good enough job spreading the word about your business? Will you have enough customers?
You need to think longer-term as your business takes off. In fact, you must now have a strategic game plan. Your business is growing fast and you have to manage that growth. That means having a vision for your business.
Should you start thinking about opening a new location, entering a new market or rolling out a new product? How should you prepare for your competitors’ moves?
Your long-term plan can and will change, of course. New unexpected challenges will emerge: new competitors, new technologies, new market trends.
The good news is you now have momentum. Your business has taken off. You have more resources, more people, and greater wealth of experience to define where you want your business to go.
There are more challenges ahead, but you are in a stronger position to face them.