As writer and speaker John Maxwell say, “Change is inevitable. Growth is optional”, and this phrase extends to life and business. A company that is not afraid of change increases its reach and generates better conditions for its community, work team, suppliers, and, of course, its customers. Building solid companies with the capacity to grow are fundamental for the economy of all countries.
However, this process is not achieved overnight, and companies must go through different stages to implement a growth strategy. Don’t try to fly, if you still can’t walk, take it easy and analyze your business situation. The answers you are looking for are right in front of you.
Before investing your capital or accessing small business financing to start a growth process, it is necessary to consider several fundamental aspects. Here are three key characteristics to know if your company is ready to fly.
Is it time to grow?
Before starting an expansion, analyze the health of your business, taking into account some variables for at least the previous six months. Not doing so could turn the dream of growth into a nightmare that leads your business to bankruptcy. Consider these three points before you start.
1. Have regular profits
A business that is ready to grow must have a solid customer base that generates net profits. Your company must have sufficient resources to invest in its own growth, whether you have the necessary capital flow for this allocation or it allows you to pay the monthly installments of small business financing. If the money is not enough, it is not the time to grow, but to work on building a solid foundation.
2. Your customers and your operation demand it
After this first filter, consider the market. If your customers ask for more products, new services, an alternate sales channel, or longer hours, these are signs to consider expansion, but caution. Similarly, if you or your staff have been overwhelmed by the amount of work, you should probably take immediate action.
3. The industry allows it
The third aspect that you must consider is the behavior of the industry in which you develop. Unfortunately, the success of a business does not depend only on your ability. If the sector is stagnant or on a downward trend, expansion may not be the best idea. Use industry figures generated by companies like Statista or those provided by the Small Business Administration. Numbers are the best companions in decision-making. Read more about Trending SEO and Business Marketing Strategies You Need to Use Today.
Financial options to grow your small business
Obtaining capital to grow your business is easier than you think. A company with a good income and considerable operation time has more possibilities to access financing from different types of financial institutions or even from external investors. Here are some options to get it.
- Traditional banks: If your company has its financial statements in order, a good credit history, a strong credit score, and earnings over expenses, large financial institutions will be happy to provide you with capital, although the process will take some time. If this is not your case, the following option is for you.
- Online lenders: They are an excellent alternative to obtain financing in a simple, fast and practical way. The requirements are less than those of a banking institution and the application and delivery of the resource take only a few days.
- Angel investors or venture capital: These options are suitable when you are willing to give part of your company to another person or institution. It is essential to consider that from this moment on you will not be the only voice within the company.
Take it slow
Before making a decision, consider all the factors and scenarios within your company. Make an in-depth analysis of the company’s health, get specialized advice and share your experience with other entrepreneurs who have already gone through this process. Growth is one of the most important stages in the life of a company since it will define the company’s scope in the future.
Overexpansion can lead a company to bankruptcy, planning methodically and surgically this process will be the key to success. Take into consideration the various possibilities of small business financing and choose the one that best suits your plans. Not all companies are the same, each one has specific needs and possibilities, makes decisions that benefit your company and allows for sustainable growth.