We Understand Growing Pains
Most people want their small business to become more successful, but ouch – growing pains hurt. As a growing business, you start hitting thresholds between where you can manage all aspects of business yourself, and where you need to delegate the activity. Accounting, marketing, payroll, and IT are typically the first services you need to outsource to experts as you expand, and this need is created by having enough business to make your expansion in overhead necessary but not enough business to hire experts (high-income) in those areas. If you do end up hiring in house before you have the income, you either have...
A. A full time staff member who is incompetant.
B. A staff member who is looking for full time work where they can make more money.
Another reason you need to outsource when initially expanding is because you need to sustain initial growth. You need stability from your team, and for your company. Part time staff and incompetant people provided neither, and high turn-over in important areas like accounting and marketing will cripple you.
Let’s break it down into numbers using marketing as an example.
Let’s say you want to expand your company by 20%. And let’s say your business closes 100 sales a month. So, now you want to close 120 sales a month. Also, let’s say for each sale you close, you need ten leads.
That means for you to close 20 more sales a month, you need 200 more leads, each month. That’s 200 more people who have to show even a passing interest in your company, than the amount of people you already have.
You need a marketing system to attract those 200 extra people.
Small businesses explore Craigslist ads, Facebook post, and flyers to generate leads. Cold-calling and networking generate leads too. But as you expand, you need more diversity to expand your leads. You need a customized website, Search Engine Optimization (SEO), Pay-Per-Click (PCC) campaigns, a growing fan base on Facebook, radio ads and television commercials to compensate for the leap in business you’re making. All of this needs to be consistent and perform, or you will be faced with laying off your production staff, and hiring them back on when you get your $#!^ together.
Now, that situation creates a whole new problem, cash flow issues. Your overhead in general will expand, as will your marketing costs, and balancing those costs with your revenue coming in is tricky. Needing a bigger facility for your employees, and employee training, can also factor in. What comes first, the extra income to see to all these expenses, or the expansion itself which will allow for the growth? This is always a big hurdle in going from a small business to a medium sized, established company.
It’s a fine line to walk, and it’s easy to lose your balance.
You need GOALS for your expansion, a SYSTEM for every part of your business, and a PLAN to achieve both. Move on to the next page and read our philosophy on how to treat this Headache, Click Here
We are not perfect, so from our experience, businesses are having problems with marketing, accounting, and infrastructure while expanding, but we could be off base. What have we missed? Go to our forum and talk about what’s specific to your business, to help us be more comprehensive in our understanding of how to serve other businesses.