When you start a business, one of your most fervent prayers is for growth to happen. You dream of new clients, bigger numbers, and the sweet feeling of progress. But what nobody will likely tell you is that scaling a business comes with a whole set of problems.
It’s like finally getting your driver’s license, only to realize that you have to drive a five-lane highway during rush hour. But that’s just how the world of business ownership is. The very thing that signals success can become the toughest challenge you’ll face.
So, what exactly are these growth hurdles or challenges, and more importantly, how do you overcome them before they overcome you?
Read on to find out.
Keeping Cash Flow Healthy
Unless you’re really lucky, this is one of the first problems you’ll face as your business grows. In fact, it’s almost unavoidable, seeing as it affects at least 88% of small businesses in the U.S.
Incidentally, it’s also one of the biggest reasons businesses fail — not because the business is not growing, but because not enough money is coming in. Maybe you’re spending more than you’re making, customers are delaying payments, or there’s a problem with your inventory.
Whatever the cause, it’s important that you find ways to deal with it before it overwhelms you. Here’s what works:
- Forget about monthly forecasts. Do weekly forecasts so that you know what’s coming in and what’s going out every week.
- Keep a minimum cash reserve, at least for 30 days.
- Send invoices quickly so that you can speed up your deliverables. Also, follow up on time.
- Negotiate terms with suppliers so that you don’t have too many people to pay at the same time.
Making Smart Reinvestment Choices
When your business starts making money, you don’t want to keep it tied up in the banks. A better idea is to put it back into your business, but where?
When there’s money, every investment opportunity looks like a good one. But is it? Imagine a restaurant owner spending their profits on dining room renovations when what the business needs is kitchen efficiency. That’ll be almost zero ROI.
So, how do you decide?
- Check your current operations to see what’s working: double down on that.
- Test your reinvestment idea on a small scale. If you want to launch a new product, run a pilot first.
- Look for investments that can yield you passive income without doing much. You want to be able to still run your current business.
- Revisit your reinvestment strategy regularly so that you can know what’s working and what isn’t.
Some entrepreneurs are currently branching out of traditional investments. A growing number are even exploring crypto options, in particular, Ethereum staking, where they lock their ETH to help secure the network and earn income in return.
The trick here is to work with a reliable Ethereum treasury company so that you can, to an extent, have peace of mind that your funds are safe.
According to Bit Digital, Ethereum has real-world applications across DeFi, NFTs, gaming, and enterprise, making it more than just speculation. Still approach with caution. Crypto can offer real opportunities, but it also carries risks.
Building the Right Team
You can’t grow without getting to the point where you have to hand off some tasks. But finding great people and keeping them can be a big hassle.
Even big brands that have existed for years and have big budgets struggle with recruiting. In fact, a recent survey by Manpower Group revealed that 74% of employers struggle to find the skilled talent they need for their businesses.
What this means is that you’ll likely be fighting billion-dollar corporations to grow your workforce. The good news is that with a bit of creativity, you’ll be able to deal with this issue. Here’s how:
- Don’t just hire for current skills or roles; hire for potential. Look for people who can learn fast and grow with your company.
- Keep your core team small and tight during early growth. Too many hires too fast can be counterproductive.
- Train and promote from your existing team. They already know your company culture and are more likely to stay loyal.
- Let everyone know what success looks like and what their chances of growth in your company are.
Preserving Brand Values
As your business grows, you’ll likely add new offices, hire more employees, take on investors, and launch into new markets. In the midst of all this progress, it’s easy to forget where you started from.
Your original culture of how you do things and what you stand for can drift away, and then you lose what makes you unique. You might think none of this matters, but it does, and your customers know.
A good example is the Bud Light controversy. In 2023, Bud Light rolled out a social media campaign with trans influencer Dylan Mulvaney. This brought on a huge storm of condemnation from critics who argued that the brand had drifted away from its original values and become woke.
The result? Bud Light and its parent company lost credibility with a big part of its customer base, and shares fell.
Whether you agree with the backlash or not, the takeaway here is that if your brand moves away from what people know it for, the result could be disastrous. In fact, 75% of consumers say they’ll stop doing business with a brand because of a difference in values, according to a report cited by Forbes. That’s a hit no business can afford.
So, what can you do to prevent this from happening?
- Write down your core values. Share them, and let everyone coming in to be a part of your business know them.
- Celebrate employees who showcase your values. This will encourage others to do so, too.
- Before you take on a partner or an investor, ask yourself: Does this relationship reflect our values?
- Revisit your corporate culture as you grow. There may be a way to adjust it without abandoning its essence.
Growing Without Failing
Every business has its own unique growth story, but if you ask its owners, you’ll discover that they all have one thing in common: growth hurdles.
The purpose of this article is not to scare you away from business or make growth sound scary. It’s to prepare you so that you can know what to expect and how to handle them. Hopefully, it’s done its job well.
