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We have prepared this guide to help entrepreneurs and small business owners grow their operations into successful companies through sound planning and reliable financial growth. It’s been broken into four chapters to outline the steps necessary in developing your operations into a thriving company.
First, we’ll look at the attitudes and personal traits required for business people to overcome setbacks and persevere in their vision.
Then you’ll discover ways to lower costs and reinvest your profits to maximize financial returns.
We’ll review how important is documenting your processes and growing a capable team through delegation of responsibilities and promotion of exceptional talent.
In the final chapter, you’ll see how to expand your customer base through effective sales and marketing techniques.
1. The Right Mindset for Business Success
If you’re struggling to transition from an unknown company to an influential competitor in your niche, this guide is for you.
You can follow these essential principles and refer to them whenever necessary. Soon, you’ll be on your way to a secure and rewarding future as the owner-operator of a respected corporation.
Given the wide range of industries and markets, nobody can offer a fast and easy formula that makes growth a guaranteed outcome. This guide is a great place to start.
Are You an Entrepreneur or a Businessman?
Every business runs into failures and successes. That means you need a certain mindset to endure the challenges and keep building the company into a success. Start with understanding the distinction between an entrepreneur and a successful business leader.
An entrepreneur is someone who wants to turn an idea into a monetary reward. Entrepreneurs believe in following dreams, but business professionals first develop a clear strategy which that path should take. The strategy becomes a set of policies that shape and guide the new company.
The entrepreneurial mentality is creative and passionate, but to be a business success as an entrepreneur, you must commit to working hard at your dream. It often means putting in long hours alone and maintaining your resolve even with the lack of visible rewards.
Entrepreneurs tend to be daring and unconventional in their excitement. Business owners rely more on established methods to keep the business running day after day. Some entrepreneurs excel at bold concepts like design and marketing, but information gathering, technology, and market awareness are essential in making those ideas work.
“Success in business requires training and discipline and hard work. But if you’re not frightened by these things, the opportunities are just as great today as they ever were.” – David Rockefeller
Business owners must have the same traits and yet be analytical-minded with an eye for detail. You need to decide what’s best for the company in providing the greatest value to customers and partners. While the business owner is no less passionate, he must consistently focus on achieving positive cash flow.
A business owner takes calculated and manageable actions. You will always have to do your research and check the numbers before making business changes.New entrepreneurs often take needless risks in pursuit of their driving vision. Click To Tweet
Entrepreneurs are intuitive where business owners are calculating. It’s not always easy to be a leader that provides both inspiration and sound planning. But it can be done, even on a daily basis, if you stay in the right mindset.
When you are focused on your mission and your goals, you can outline the steps you need to get there.
Manage Your Expectations
While running your business, you have to become adept at meeting the expectations of those you depend on: clients, vendors, employees, and more.
But you can’t overlook your own priorities. If you set a goal of making $50,000 in sales next quarter, you will feel discouraged and resentful if you miss that milestone satisfying someone else.
That includes family and friends. Your personal life may have to be put aside to pursue the many objectives a growing business has to address. This can be difficult for them to get used to, but they should understand that business and financial stability are also a life priority.
You can think of every company as a living thing. Various parts of it must change and adapt while different processes may expand or shrink based on market or operational demands. As a business owner, you’re taking on the responsibility of bringing order to chaos in any situation. But, even the most successful entrepreneurs need to rein in their ambitions.
Settling into a familiar routine of meetings and other mundane business functions can cause you to become distracted from what you’re trying to accomplish.Don't get in the habit of expecting rewarding outcomes at every turn as the constant growth is almost impossible to meet. Click To Tweet
As an entrepreneur, spend your time looking for solutions that improve every part of your company, from accounting to project development. Simultaneously, devote your business side to improving profitability throughout the firm. With efficient operations, one flows from the other.
A successful company has many aspects, such as building a good team or maintaining quality control.
Patience will be invaluable in helping business owners make the right decisions. Setting long and short-term goals is a positive factor in growth.
By deliberately working to meet each step in reaching your larger goals, you will discover that minor setbacks will not disrupt the big picture.
The Power of Patience in Business Success
You’ll face a range of vital business challenges over time, from developing a recognizable brand to building a company culture of innovation and loyalty. But progress is always gradual.
It’s difficult to stay patient when everyone around you is looking for a quick gratification. Any business owner must deal with this, but success often means juggling various concerns to move a little closer to realizing your true vision.
No matter what obstacles you meet, you must work relentlessly to get where you want to be.
Patience in business requires more than sitting back and waiting for the results to come. Thoughtful decision making is crucial to every aspect of your operations and at every stage of development.
You must be always tracking and testing. Success only comes from taking the actions that drive it.
“Patience is not simply the ability to wait – it’s how we behave while we’re waiting.” Joyce Meyer
Perhaps you’ve heard a term like: “10 years of silence.” This is the expected time frame for a startup to become a successful organization. You may have to work hard for years on end to build the company you want.
Patience matters in everyday concerns like training employees or developing customer relationships. Many entrepreneurs can get frustrated as their vision slows or founders. Remember that even over-patience is not bad during the first couple years when you’re leaning your way.
Impatience can undo months or years of careful planning and effort. Your mind can jump to conclusions, even premature assumptions of failure if things don’t fall into place as soon as you’d want them.
Never rush into business decisions. The first phase of growth is putting the fundamentals in place that will support future business expansion. Even carefully planned development can be elusive if you aren’t patient.
Rash decision making can lead to waste and quite expensive errors.
2. Managing Your Business Finances
Many people dream of starting their own company, becoming their own boss, and getting rich in the process. But 96 percent of new companies fail within 10 years.
Becoming successful takes more than a good product, fresh ideas, or even great salesmanship.Learning and sustaining the techniques of smart money management is one cornerstone of lasting success. Click To Tweet
Running out of operating capital is a constant risk for large corporations and small businesses. It can happen suddenly through poor decision making, or slowly as you keep up with market changes.
A weak financial strategy is the chief cause of startup failures.
Common Money Mistakes in Business (And How to Avoid Them)
Tips for financial stability start with some common mistakes that new businesses make, putting themselves at excessive risk:
Negative cash flow: Every company needs to track precisely how much money is being spent. You cash burn vs how much is coming in allows you to determine what profit is being made.
Not adjusting forecasts: Especially when profits are thin, it doesn’t take much to tip your business toward financial loss. A disastrous turn of events such as losing clients or losing market shares calls for you to re-examine profitability and adjust ASAP.
Not keeping reserve funds: Organizations need an emergency fund just as people do. Otherwise, the next big expense that catches you unprepared could drain needed funds or put you in debt so that your business is in jeopardy.
Minimize your debt: Borrowing could fund your next big project, but you’ll be paying it back with interest even in quiet periods. Avoid loans and risking your credit unless you can forecast returns with confidence that justify it. Building cash reserves helps you avoid debt.
Expanding too fast: There’s always a danger of overspending when you decide it’s time to broaden your operation. You’ll run into increasing costs like hiring more help, buying or leasing more space and equipment, rising insurance rates, demands on IT infrastructure, and so forth. Don’t gamble; let your profits dictate your rate of growth.
Bad hiring practices: You want to build the best team you can but remember that hiring top talent can be a costly investment in financial and operational efficiency. Even a minimum-wage worker could cost $3,500 to recruit and train. Determining whether each candidate is a good fit for your company mission and culture in the long run is just as important as deciding whether they’re qualified.
Nobody can predict either success or failure with any guarantee. It’s essential to business continuity that you assess all financial risk to your company’s future. To keep solvent, track what kind of cash surplus you’d need to remain in operation for 30 days if half of your clients could not pay you.
Know Where to Spend And Where To Save
Even an infusion of cash from investors or crowdfunding will only postpone disaster if your finances aren’t sound. The wrong investment will only squander it and make your money troubles worse.
Yourself: Be sure to pay yourself well enough that a fair amount of profits are going into your pocket. While it may tempt you to reinvest every spare dollar, remember your personal income should be separate from your company’s.
You’ll be able to make more rational decisions if your own fate doesn’t depend on your business. When business is good, use the profit to pay off your own debts or turn the money over in individual investments like stocks or real estate.
Financial help: Including business and investment advisors in your decision-making pays back. They’ll give an honest evaluation of your finances from a different point of view. An experienced advisor can point out past mistakes and recommend new strategies.
You don’t have to jump on every recommendation, but expert advice is always a plus. If you build a relationship with a reliable financial advisor that understands you and your business, they can become one of your most valued partners.
Payroll: You’ll be enthusiastic about each new phase of growth, and when doing more business, it makes sense to hire more people. But what if a slump comes after a sudden expansion?
Mass hiring and layoffs can lead to employee dissatisfaction and bring a bad reputation. Hire only when you expect a permanent need. For the short term, engage agencies for low-skill jobs, and outsource work to freelancers or third-party services for more skilled positions.
Software: Don’t buy the latest programs just because your competitors are buzzing about it. Integrating new solutions is difficult. It can involve training, compatibility, and licensing headaches. Also, some employees will resist change, and you’ll have a period of lost productivity while they adjust. Check out free trials you and your team can test at no cost.
Pinch Pennies with Technology
The right technologies can save you time and money by introducing automation to certain activities. Make operational efficiency a central strategy of your business and use tools to do it.
File sharing and cloud collaboration improve communications and productivity. Remote workers or employees in the field thrive on the cloud. Your workforce can upload forms or access information no matter where they are.Moving your data to the cloud makes your personnel flexible while lowering in-office overhead. Click To Tweet
Some cloud services offer simple interfaces with a centralized approach. That improves communication among team members, vendors, and clients. Customer satisfaction increases by eliminating call wait times. You will also keep partners and clients happy if they can check their accounts or orders, and upload or download needed documentation.
Centralizing your customer data is always worth the price. When you can share updated customer information across the company, invoices and data changes won’t get overlooked.
Your company can also leverage a range of financial apps. From bookkeeping to predictive analytics, they can help you track your cash flow and spot areas where you can cut costs or develop more revenue.
A “profit first” mindset will help your business grow, but effective tools are still essential to track what are you earning and what you spend.
3. Creating A Scalable Business
Most small businesses start out small, sometimes with a laptop and a desk at home. But growth is always the goal. With more business comes more profit.
To make growth as smooth as profitable, include scalability in your business plans.
A scalable company is one where the future revenue costs less to achieve than the current. The expense of funding growth is more than offset by the added profits you can make. While every business owner is looking to expand their operations, a scalable company integrates the groundwork for later expansion into every part of the organization.
“You can focus on things that are barriers or you can focus on scaling the wall or redefining the problem.” Tim Cook
Scalable operations are essential for building a successful company. You want to affect growth without disrupting workflows or impacting quality.
Prepare for Growth
Growing and scaling for growth are two different concepts. Increased business activities may affect different aspects of your company.
When your company doesn’t ensure scalability, uncontrolled growth can actually be damaging.
You can make more sales and hire more people, but if you haven’t scaled your operations as you should, you could start making less profit. You can even reach a plateau beyond which growth will cost too much. This is sometimes the case if growth is too rapid for making adjustments.Understand that failure is still possible even with expanding the business. Click To Tweet
Assessing your company to see where to improve efficiency is a good strategy to make it scalable.
Identify routine tasks which automation or software can replicate on a wider scale with reduced expenses. For example, if your sales increase but each one takes the same time and cost it always did, you aren’t scaling your sales department.
You may be unable to step back and see things from an unbiased point of view. It may be wise to bring in a consultant with expertise at scaling company growth.
They can spot the limiting factors that are not cost-effective to your business model and outline a better strategy.
Doing the same tasks but at increasing volume requires upgrades to business solutions.
Scaling done well means you’ll improve productivity with less pressure on overseeing management.
By delegating tasks and empowering workers to do more, you lower demands on your own time.
You should arrange systems to integrate as much automation as possible. Technology can make repetitive tasks like billing, data collection, and inventory management faster and easier. Spending less time on these activities means employees can take on other responsibilities. Focus on making your operations more independent of constant control and central authority.
Ensure that the guidelines for each job role are written and communicated. Training new people could involve a set of videos, webinars, and tutorials in the cloud. Document everything to support consistency and future improvements.
Be sure procedures communicate the information everyone needs to do their tasks and are accessible for reference. No process should depend upon one person for completion or approval.
Build a High-Value Company
A good source of inspiration is to raise the value of your business even if you have no plans to sell. By building your company’s net worth, you see it from a new perspective. This frame of reference will help to improve operations, so they give greater profits.
Whether your investors are real or figurative, the pursuit of higher value will create a more stable business future.
Build in more sustainable processes with less dependency on key personnel.
You’ll be able to hire and fire easy, and a wider distribution of responsibility will make it simpler to innovate.
Developing a company to grow in value will allow you to maximize its potential and establish a more stable, scalable organization.
There are eight crucial factors in driving your company’s scalability:
- Improve Financial Performance
Constant improvements to cost-efficiency will continue to drive up profits and support scaling. Eliminating waste, task automation, and getting more value from supply chains will lower expenses and increase revenue.
- Increase Growth Potential
Every role within your business should be scalable to future and sudden expansion. Plan for increased capacities, acquisition of more resources, more space, and technical solutions that are wider in scope. This way, you can accommodate growth without needless delays or miscalculations.
- A Switzerland Structure
Reduce dependence on individual customers, vendors, or staff. You can streamline operations and delegate tasks without the future earnings of your company depending on any other person’s involvement.
- The Valuation Teeter-Totter
You should be able to achieve a momentum where your company is generating receivables more than expenditures. This leads to increasing value and more financial opportunities.
- Recurring Revenues
The more revenue you get with each deal, the faster your value rises. You should always strive for ongoing income streams, not one-sale profits. Do this by offering consumable products, subscriptions, auto-renewal of services, and term contracts that make each client a long-term buyer.
- The Monopoly of Control
Focus on improving outreach and brand awareness to bring your company closer to the exclusive command of your commodity or service. The larger the market share you can capture within your niche, the more influential and profitable your business becomes.
- Improve Customer Satisfaction
Increase the likelihood of customer recommendations by improving the client experience. Raise customer satisfaction by providing better service and more value. Measure this by tracking your Net Promoter Score.
- Hub & Spoke Structure
If company operations depend on you, distribute responsibility through better training and communication. Document all processes so that employees know what to do, including steps for problem-solving.
It could take years to organize a company to be scalable.
But even if you hit a wall, you’ll find a nationwide network of over 30,000 certified financial and business advisors that can coach you in this system. With their help, you can transform your company into a high-value and profitable enterprise.
You may never choose to sell the business you worked hard to develop.
But know that a company that makes all her systems scalable is ready for steady growth.
4. Growing Your Business Further
Any growth is welcome to get your company past the startup stage, but from there, your focus has to evolve.
Planning for and sticking to scalability principles should not interfere with the need to find and follow new advancement opportunities. You may require all of them to drive long-term success.
Key indicators such as market share, gross profits, and sales numbers will tell you when things are going well but always look to improve performance to fuel new expansion.
Only when you’ve developed a sustainable growth plan and put it into action, you can expect steady progress in building your company.
Here are tactics that should be a part of your game plan for continued growth.
Spread Your Unique Brand
Your brand is the total user perception of your company. It’s not only advertising, logos, or marketing campaigns, but also your philosophy and your reputation.
Companies must integrate all these things in a unique and positive way that people will recognize in a glance and relate to emotionally.
To expand your brand by offering franchise opportunities is a good way to prevent competitors from going after a piece of your market. If your consumer base expands faster than you can keep up with, consider offering franchises at a minimal investment. This will increase your market coverage and visibility fast.
Franchising allows companies to improve earnings while others spread their brand. You can train your franchisees as you wish and bind them to your rules with a contract.
By ensuring they meet standards, you offer an efficient business model while preserving the integrity of your brand.
“Ambition is the path to success. Persistence is the vehicle you arrive in.” – Bill Bradley
Hold franchise purchasers to the same consistency you’d follow if you were opening another branch yourself. You must put together a package that clones your operations.
Many fast-food restaurants are franchise deals. One of the most successful franchises on the planet, McDonald’s, demands consistency of marketing down to the exact colors. But, they are always ready to change product offerings or advertising throughout the corporation, to keep in accord with customer needs.
Open Shop in Another Location
Before opening another physical locale, do a good deal of planning and research. Finding the right spot for your business is just the first step.
It may not pay off if you don’t offer good training and communications with branch managers; that’s critical for the location to work smoothly.
You can lease or buy but must calculate expenses like maintenance, taxes, property insurance, and more. Choose the site for the new location not just on costs, but on whether it will support your business profitability for the longer term.
It should be an easy-to-find site in a growing local economy with the potential for capturing a large market share.
Be sure you have enough internal space for both office operations and storage if you run an inventory-based business. You also must think about advertising, staffing needs, parking, and connecting with the community.
All these factors should bolster the steady growth over the next several years.
License Your Product or Service
Working up a licensing arrangement involves legalities and research, but it helps you grow into an influential company fast.
If your business is too small to gain major retailers as clients, other companies or entrepreneurs can offer an outlet.
By providing a branded product or service to licensed dealers, you have a low-cost way to promote yourself and improve your income stream. You can license any product or intellectual property to which you have full rights through patents or trademarks for sale to others.
Consult with an attorney that has experience in these matters. You don’t want to expose yourself to lawsuits or let your brand suffer from inferior imitations. Take steps to make sure you’re not providing licenses to irresponsible or unethical parties.
When you work out licensing right, you can sit back and collect the royalties.
Broaden Your Market
One maxim for business is that it’s much easier to make repeat sales to satisfied customers than to win over new ones. The key is generating extra cash flow from your existing customer base.
Offer discounts to returning customers on products or services they might like as a sale incentive. For example, why not take a similar approach to Amazon.
Amazon shows additional products on each page with headings like: “Customers who bought this product also liked… ” and an assortment of related items.
You should also look for ways to extend your reach to new market segments, whether it’s physical areas, demographics, or partnerships with companies in a related niche. Or sell these products and services yourself.
Start laying plans to grow your market on a global scale.
Your growth plans could include turning your employees into super salespeople by offering bonuses to motivate them.
Train and encourage them to upsell and cross-sell at every opportunity while assisting customers. Personalized selling can be a valuable service that clients will appreciate.
Suggest to your customers they give referrals, otherwise, they are unlikely to give them. Happy customers are more inclined to steer others your way if only you remind them. Use other methods to draw them in, such as offering coupons for taking surveys.
Launching a loyalty program is a good way to increase repeat business. Loyal customers are more likely to send more business your way.
You could also have a “gold level” or VIP program with special offers or discounts not available to anyone else. These consumers will have a further incentive to buy and stay loyal.
Expand your reach even further by marketing at trade shows, offering branded giveaways, or contests and webinars. You could partner with a popular charitable cause or strike a deal with other companies for making referrals to one another.
That should give you plenty to think of in building out your own company.
Developing a scalable company is essential to success but keep your focus on expanding sales.
Wrapping It Up
Looking back to the first chapter, you learned how to achieve the right mindset and transition from an entrepreneur with big dreams to an efficient business manager.
Patience and the ability to focus on aligning your efforts with your expectations are key.
Then we talked about a systematic way to organize finances, money mistakes to avoid, where to spend and where to save, and how to introduce new technologies on a budget.
Later, we focused on the main topic of this guide, how to make your company scalable. Scalability means maintaining high returns no matter how dramatic your growth is. By preparing ahead of time, leveraging automation to increase productivity and reduce cost, and focusing on adding value into of your operations you will achieve that.
Finally, you found several suggestions for boosting sales by expanding your market and developing a unique brand.
By combining these concepts into your regular business routines, you can realize steady growth without the risks or headaches of poor planning.
About Interactive Wealth Advisors
Interactive Wealth Advisors is a Portland, OR Fee-Only financial planning firm serving Portland and all surrounding areas. Interactive Wealth Advisors Inc. specializes in providing objective financial planning to help clients build, manage, grow, and protect their assets through life's transitions.
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