5 Key Success Factors for Growing Your Business
Most entrepreneurs are always plotting and strategizing growth, whether it’s expanding the number of acres in production on their farm, creating new product lines, or opening up another café. After all, the successful growth of their businesses means the potential to earn more profits –– and who doesn’t want that?
When advising clients, one of the questions I’ll ask myself is, “What are the key success factors for their growth?” I’ve watched and advised a wide range of entrepreneurs in their growth: some to grand success, others less so. Through my work, I’ve discovered that the keys to success are the same, whether you’re growing a farm or a chain of restaurants. The specifics may vary but the principles do not.
As you think about goals and growth in the New Year, what are the five key success factors to growing your business? It boils down to making pragmatic choices that ensure your new project stands on its own two feet, while maintaining the quality of your existing endeavors.
Appropriate capitalization
Make sure that the business operations can support the financing. It’s one thing for a business to be able to operate profitably at its core: does the business generate more revenue than it incurs expenses? But, in order to start and/or expand a business, you likely will need funding. Can the business generate enough revenue to cover expenses and the cost of the financing?
Make sure that you have enough money to accommodate delays and going over budget. Unexpected expenses are going to happen, so you might as well be prepared for them.
Appropriate on-the-ground management
As businesses grow, the CEO needs to focus less on individual units and more on the big picture, or the next big project or unit. To accommodate this entrepreneurial vision while maintaining the company’s integrity, you must have a team on the ground at the individual units that inspire the CEO’s passion.
The skills that brought you to this first level of success are not necessarily the same skills that will bring you to the next. As CEO, you’ll be focusing less on the day-to-day and more on big picture strategy. You’ll need to learn new skills in your new role as well as learning to delegate your old responsibilities.
Make sure that each new project is sound on its own merits.
Your last project/unit may have succeeded but that doesn’t guarantee success for a new unit. This brings to mind a chef who opened his first restaurant to wild success, which he attributed to skill as a restaurateur. He subsequently opened several more restaurants – all of which closed within a year. Chances are his original success was due more to timing and luck (or as I like to call it, “Pixie Dust”) rather than any particular talent at management or concept development. Rather than relying on factors beyond your control, make sure that you’re evaluating all your risks and not just assuming you’ve got the magic touch. Of course, a little bit of pixie dust always helps!
Your brand needs to evolve with the times to maintain relevance.
What worked for the last 5 years may not work for the next 5 years. What has changed since you began, and what makes you distinctive now?
Don’t rest on your laurels.
As much as you think you’ve built a systematized business with appropriate controls, quality must be continually monitored. It’s not worth sacrificing your original business in deference to a new and unproven direction, so as you branch out, ensure that what’s working continues to be successful.
Are you thinking of growing your business? Give us a call or email, and we’ll discuss how to develop each of these five factors to help you find success.
