Has your business been experiencing significant yet consistent growth in demand for its products or services? Do you feel that these demands are struggling to meet the current supply? Then this is a telling sign that it may be time to march on the path of expansion. As your company continues to grow, you will inevitably be faced with more complex challenges and tests, which can be quite difficult to navigate even for the most successful CEOs.
Like anything, there is always a need to strike a balance when upscaling a business — growing too quickly can be disastrous if the company has not acquired enough resources to accommodate new work; growing too slowly can cause stagnation and risk competitors supplanting you. Moreover, to have a stable yet continuous growth pathway, it requires you to identify the all-too-varying professional indemnity risks early on so you can meet them in the long run.
Needless to say, scaling is a complex business in and of itself, requiring the right systems, processes, staff, finances and so on. As such, before making the dive, you will first need to do some thorough reflection on whether your business is truly ready for its upward journey.
Check Your Cashflows
Cash flows are the things that make or break any business — they determine whether your business can grow sustainably or if it is pretty much destined to fail. Liquidity is a crucial indicator of whether your business has the space to grow; if a business is lacking in solvency, then any attempt at upscaling will result in potentially disastrous consequences.
Ensuring there is more money coming in than flowing out is the first fundamental step before deciding on any expansion of your business — the process involves inherent risk, whether it is hiring more workers, investing in new technology or equipment, or even opening a new premises such as a warehouse, office, branch or even moving internationally. A good way to check your cash flows is to create a cash flow statement that includes all of the company’s operating activities, investing activities and financing activities.
You Have a Solid, Growth-Driven Team
Finding the right employee is hard, and retaining them in such a highly competitive market today is even more difficult. One important factor to look at if you want to grow is your employees. If they have been actively seeking out growth opportunities, whether through proactive engagement, actively seeking out continuous learning or training programs, reaching out for career conversations, or having increased ambition, then it is clear that they are looking for a role with potential for higher earnings and professional development. But precisely speaking, this individual growth only happens when the company grows.
To sustain this growth-driven mindset, which allows you to have greater certainty and confidence in your blueprint for expansion, you must preserve a healthy work culture as well. Ensure to build a continuous relationship with your employees, whether by chatting to them about both yours and their expectations, ambitions and concerns, as it makes them feel supported, respected and valued; it also gives you the space to enact recommendations and constructive criticisms to improve the company. Acquiring a buy-in from them is crucial before executing any future growth plan.
Customers are Seeking Out
When customers are telling you how much they would love it if your business opened at a certain location, then it is a pretty clear indication that you might need to either ramp up production or open a new branch. But you should not always take customer feedback for granted, as you should prioritise (just as before) great service, transparency and even rewards. The third option can be an excellent opportunity to show customers that you care while incentivising them to keep returning and purchasing your products or services throughout the period you are deciding on upscaling or expansion plans. But ultimately, expansion should only be done when you feel you are ready to do so.
You Are Keeping Up or Even Ahead of Competitors
Another definite sign is when you feel that your business has finally reached its competitors or has even moved ahead of them. Of course, at the same time, you may also be meeting new competition as well. It is vital, before any expansion, that you have solidified a place in the competitive landscape and already have a thorough understanding of your customers’ needs and industry trends. It is only then that you will be better equipped to make the march forward and have an informed decision-making process for your business’s growth.
To keep up with the competition, you will obviously need to have adequate technology and talent that facilitates seizing the opportunities to support growth. But having an in-and-out knowledge of them can also ensure you sustain your differentiation from the rest, and therefore refine your value propositions. Furthermore, beyond just competition, making strategic alliances with other local businesses can allow you to gain more valuable insights and collaboration opportunities. They can expand audiences, enter new markets, reduce costs and cultivate brand reputation, which are all aligned with the growth or upscaling process and your ambition to take on larger contracts.
Demand is Outpacing Supply
Demand does not just refer to customer and production demand — it also includes investment demands, strategic and decision-making demands, talent demands and infrastructure demands. This is different from mere good revenue from sales and whatnot — when demand is sustained and continuously outpacing what you have currently, it means you are entering the territories of building (or needing to further build) a systematic, durable and scalable business. Once these are gradually piling more than your current plate can handle, you should start treating business scaling not as a sprint, because that risks burnout, breakdowns and even business failure — but as a marathon.
Your team must be capable of carrying the baton forward, yet it should be done steadily with stable and structured systems in place. While timing is crucial, strategy is even more so; you will need to be a bit calculative in spreading your inventories and consumers within a market that is thirsty for more, while also giving staff breathing room for consolidating future expansion plans. For things like investment demands, try to make the calls as much as possible, especially if the scale opportunities are there in front of you; while incremental growth and changes are usually focused upon, when such lucrative situations come, they require more audacious actions by you.