If small business ownership can offer you the triple blessings of freedom, independence, and the ability to sleep in at least occasionally, why doesn't everyone do it? Because it isn't very easy, that's why.
Take, for example, the fact that even fast-paced business growth isn't an absolute guarantee of success.
Why not? Well, you could think of it as a kind of 'runaway train' scenario – where demand for your services or products outstrips your capabilities (and preparedness) by so much that you simply cannot cope.
In essence, to make the most out of favourable circumstances such as increased demand, you just have to be ready. Otherwise, these new opportunities will disappear into the ether, never to be seen or heard from again.
As an article on the Queensland Government's Business and Industry portal advises, “It is essential that you research and plan the growth of your business. For business growth to be successful, it should be sustainable.”
“Your business may become a market leader if you take advantage of strong opportunities,” the article says. “You can capitalise on your success, expand into other locations, and employ more staff to cater for increased demand.”
“But if you expand too quickly you risk your business becoming unsustainable. Growth can put pressure on staff and resources, as well as financial and management structures.”
In a feature appearing on the American Express OPENforum website, writer and publisher Carla Young discusses the 'double-edged sword' associated with any kind of spike in sales.
“In startup mode, growing too slowly means you risk running out of the capital needed to support the basic operational costs before sales reach the break-even point,” she says.
“Growing too quickly means you face another set of challenges, ones that put you at a greater risk than the slow growth that kept you up at night during those shaky startup years.”
“The ebb and flow of cash in, cash out gets more complicated as you grow,” Young explains. “It doesn’t take much growth before your monthly expenses exceed your operating credit, and suddenly one bad sales month takes on a whole new meaning.”
“Keep your eye on three areas of the business: your systems, your staff, and your cash reserves,” Suzanne Kearns advises on the Money Crashers website. “Successful growth requires taking the time to plan and prepare to sustain all three as your business increases.”
“Growth isn’t just admirable – it’s expected. But often, small business owners don’t consider that growing a business too quickly can eventually cause the company’s demise.”
Something else to keep in mind, says Kearns, is that during periods of rapid growth you also need to maintain “the level of service your customers expect”.
“Personal attention is a key selling point that attracts customers to a small business, especially when you’re involved in an active local community,” she says.
“In the face of unexpected growth, you’ll face the challenge of maintaining quality with the increase in quantity.”