Plan for growth
Planning for business growth?” Having a plan for business growth is essential for any company wanting to succeed. Start-up businesses do usually have a business plan, usually only due to trying to achieve start-up business £ funds. Usually these business plans are theoretical, usually only based on educational experience, usually based on enthusiasm and determination.
Enthusiasm, determination and momentum are the key qualities to keep a business on track, or at least with this you can plan, do and review consistency.
This is what Peter Jones says…
If you’re going to dream, then dream big, because reaching one horizon always reveals another. That’s why VISION and PLANNING exactly how to achieve that vision, are critical success factors in turning big dreams into absolute, veritable reality.
A plan for business growth is vital. You need a vision of what you want to achieve and a plan to get you there.
Daring to dream pays huge dividends!
If you forecast and plan for business growth, as a successful entrepreneur you can scale the business up, without strangling it or running out of cash – AND therein lies the key factor in effective growth management: cash!
Effective business growth always comes back to the amount of cash that you have available. Scalability is about the amount of money that you have in the company to invest in that growth. How, when and in what you invest your profits, are the core drivers of growth. The key to scalability is achieving balance, and this is critical.
For example, a sales-generating business may have periods of exceptional growth. What is vital is how that upsurge in growth is handled. Over-investing is a common mistake made to cover growth. Unfortunately, if a few leaner months follow a period of growth, staff costs may need to be reduced. And what if you’ve taken on bigger premises to cope with the growth that you can no longer afford?
Stable and solid growth comes back to the all-important requirement for forecasting and a couple of key questions should be asked: What are you doing with your cash? and How are you reinvesting it? Think carefully about these questions at all times when it comes to your plan for business growth.
If you want to know how to grow a business it is worth considering two particular scenarios to ascertain whether you are ready to expand. They can be summed up in two questions.
Q: I’m exceeding my sales targets requiring me to double the size of my business?
A: No – not always. If you are looking to increase the size of your business consider doing this in smaller stages, taking smaller short term growth steps rather than one massive increase. Even a large upsurge in business might only necessitate a small growth in business size. Over investing and financially over committing can destroy a growing business.
Q: Christmas has proved exceptionally successful for us in sales so should we on bigger premises?
A: No. You should only consider expansion, whether in more staff, larger premises or increased costs, if you can guarantee forward income. If you win a contract that guarantees a level of income for defined period, you may be able to consider scaling up.
Guaranteed contracted income is vital to secure stability but you still need to bear in mind that profits can be seasonal or temporary, so ensure that you:
- keep your costs to a minimum
- absorb any profit
Reinvesting profit smartly is of crucial when you look to successfully plan for business growth. You need to understand how best to reinvest for success, and only up scale when your profits are sustainable, constant or guaranteed in a contract.[/mk_toggle][vc_custom_heading text=”Create your business plan ” font_container=”tag:h3|font_size:16|text_align:left|color:%23000000″ use_theme_fonts=”yes”][vc_column_text]
If you want your growth to be profitable and effective, you need it to be well planned and a business plan is where you need to start. To help compile your own initially business plan look at the template attached from peak insight and use it as a guide and format for your own
Download our business plan template