Every business owner starts his business with a goal in mind that he desires to fulfill over time. Once the short-term goals are met, he prepares for the next growth phase. However, it is recommended that the plans should not be made at this particular point in time. But, the business owner should have something in his mind beforehand. It provides a clear strategy, motivated workforce, and sufficient finances.
The following are some of the ways through which you can prepare your business for the growth phase:
Always have Finances Ready
Business expansion requires sufficient funds, as the business expands, expenses also increase. Such as renting a larger business place, salaries of new employees, buying additional machinery, etc. There may also be a requirement for contingency funds for various expenses that may not be earlier present. The business owner must ensure that he has arranged for multiple sources of external financing, such as a business loan.
Let’s take an example of a general store owner who is expanding his business by starting a new product line in his store. For this, he may require a bigger store for more products, plus he has to hire more employees and require storehouse as well. From leasing new store to employing more persons, everything involves money. It means increased expenses. For all these expenses, an MSME loan without collateral comes handy. MSME loans help in getting timely access to capital required for business expansion.
Business Plan Revision
Since the business plan comprises of business’s objectives and strategies, it is essential that it is updated regularly. Once the objectives are achieved, it should be updated. This step is even imperative when the business is at its initial growing stage. The objectives and strategy should be updated as per the ongoing business environment. This provides a sense of purpose and direction of the business. Besides, it also gives the employees targets to work towards.
Notably, if the business owner plans to raise funds from investors or stakeholders, a business plan is essential.
The key essential parts of a business plan for a company aims to make big in future include strategy, specific, tactics, and forecasts. For instance, the general store owner needs to mention his target audience, market segment, pricing, recruitment, and marketing tactics along with the objectives.
A growth phase most often tend to take a toll on the employees as it involves a lot of hard work at their end. They need to work more than before or maybe perform the same work in a different manner. These new changes may make your employees demotivated, which eventually may lead to decreased productivity. Keep this away from happening by making them a part of the company and its growth.
For instance, the business owner can thank his employees for all the hard work from time to time and also tell them about how the demand for the existing product has increased. This may help them give them an idea about how the product is working and how it can be improved. The employees can be prepared by creating a new day-end reporting structure for administering the workflow, identifying clear roles, and linking performance to goals.
Arrange Needed Technology
Business expansion is incomplete without the required machinery, equipment, and software. So, it is imperative to evaluate the requirements and the tentative cost of the same. It is essential to calculate the right amount of raw material and machinery required according to the sales forecasts. Buying the machinery needed with the help of a machinery loan and paying it back in instalments can ease the cash flow.
With a clear growth plan, machinery/equipment at the place, and motivated employees, a business owner can certainly take his business to the next success phase.