Growing a small business is a topic that any business owner should be interested in. The difference between growing a small business or just floundering around comes down to a few different aspects.How much planning do you do? Growing a small business takes a lot of planning, A lot of regular planning. The most successful businesses all take planning very seriously
From day one you should set aside time on a regular basis for strategic planning. I recommend having a formal planning session. I might be biased, but if you hold at least quarterly preferably monthly board meetings you are forced to do strategic planning and business opportunities. By holding regular board meetings growing a small business will happen. You also gain the advantage of looking critically at your business on a regular basis. Which brings us to the following question.
What kind of measuring system do you have in place? Being able to have access to the vital metrics of your business on a regular basis is how you stay on track. What metrics to monitor is something that is different for every business. There are some core items like your P&L and balance sheet that all businesses should keep an eye on. Others might be profit per customer, profit per employee, referral rate, complaints per customer and complaint resolution time. This is a very short list. Start figuring out what metrics will be most beneficial to your business. Don’t worry about finding them all out at the beginning, just start with a few. Growing a small business is going to take a lot of measurements. Make sure that you are measuring the key aspects of your business.
What kind of systems do you have in your business opportunities?
How scalable are they? Small business systems are critical to growing a business. If you’re holding regular planning sessions (board meetings) you need to have systems get consistent results from your actions. Systems are the central nervous system of your business. Systems relay all the information to and from the board. Your business board is where all the key decisions come from.
Small business systems take a lot of time to develop and should constantly improve. A desirable system will create consistent results regardless of who is performing the task. An example, give the system to a new employee and they will complete the task with the same result a seasoned employee delivers.
Working as a business broker I see that an average business that sells for 1-2 times net profit has no formal systems. The businesses that fetch higher multiples always have formalized systems in place.
When you’re not doing business planning, working on business systems is one of the best ways to spend your time.
Take action! Taking action is vital. I see so many aspiring business owners who attend seminars, read books, attend networking events and even claim to be a business owner. The one thing they are lacking is action. All the planning in the world isn’t going to mean anything if you don’t take action, preferably massive action. Growing a small business doesn’t happen overnight. If there is no action it’s never going to happen.
There is a lot more to growing a small business than this short article contains. If you set yourself up correctly from the beginning, or make the appropriate changes to your current business. You will find one of the most personally and financially rewarding things you do is growing a small business.