Business Owners are natural risk takers, but that doesn't mean they should be ill-prepared when it comes to the future of their business. This is where growth planning comes in.
Growth planning is about envisioning your business's future and then creating a plan to launch your brand into that future. This means forecasting to see how much cash you'll need to get there and evaluating how much growth is possible given the resources you have on hand—as well as how long it will take your company to grow within those limits.
It's not just about predicting the size of your business in X number of years; or even about setting revenue goals for yourself over the next few quarters. Growth planning also involves thinking through what it will take to get there—how many employees you'll hire, how much inventory you'll need to purchase, what kind of marketing strategy will be most effective, which partnerships will help propel you forward, and so on.
Once you've built a solid plan for scaling up your business without strangling it or running out of cash, you can begin implementing that plan with confidence and peace of mind that you're not just gambling with your livelihood—you're betting on a sure thing!
When you're planning for growth, your business plan will always come back to the amount of cash you have available in the company. Scalability is then about how much money you have to invest in that growth and whether your company can grow without being hampered by its Processes, People or Systems.
How, when and where you invest your profits are the core drivers of growth. With scalability, finding balance is critical. Expanding too quickly can be as detrimental as expanding too slowly. The answer lies somewhere in between, and it depends on a number of factors: what stage your business is at; how much you want to expand; how fast you want to expand; and how far you are prepared to stretch yourself and your finances.
The future is unknown. But you can predict it with a good confidence level.
For all businesses, forecasting the ups and downs of the market is an invaluable tool. A good forecasting model will not only help you plan for the future with confidence, but it can also help you avoid expensive mistakes that may cost your company time and money in the long run.
In order to build a good forecasting model, you need to know what kind of information you need to have on hand. In general, your model should include:
Your model should provide a clear picture of where your business is headed both short- and long-term, allowing you to make informed decisions about how to invest your cash and resources.
Growing your business can be both exciting and challenging. When you're in the business of making more money, you need to make sure that your investment choices are wise—but that can be tough when there's so much pressure to succeed.
Don’t rush yourself into making a big splash or you might miss out on a bigger opportunity that lasts. Focus on making smart, incremental changes that build on one another, starting with profits you can count on.
But taking risks is part of being a business owner, and sometimes it's worth it. You just have to be able to look at yourself and say "I'm confident enough in this risk that I'm about to take."
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