Congratulations – you have successfully started your own SME business and survived your first year of trading, sadly 25% of start-ups don’t make it past Year One – the good news is the failure rates decrease with each passing year of successful trading. The reason for this is the continuous building of the customer base, improving the business model and building cash reserves.
So now you are thinking of expansion but the first thing you need to consider is where exactly the expansion is going to come from and in what form. Here are some tips to consider:
- Do you have the right people
The greatest test for any business is the level of expertise within the management team and how prepared and capable they are to take on extra responsibilities. Clearly, if you as the business owner are a true leader and you are prepared to step back from the day to day control while allowing others make the decisions then go for it. It is critical that the right people are in place in the correct roles to bring your business to the next level.
- Have you got your systems in place
The only way to expand a business is to have robust and well documented systems in place allowing for any new hire to reference a training manual which will clearly instruct them on procedures and activities to ensure the smooth running of their particular area or role. This takes time and needs to be flexible to allow for changes in procedures, changes and improvements.
- Do your numbers
Simply put do you have the financial resources to fund an expansion programme? Let’s face it, it is going to take time and substantial investment to expand. What happens if the sales do not materialize or take longer than you had planned? Can you afford to pay the additional staff required while you wait for customers to pay? What about the additional space or resources needed? Have you allowed for training and up skilling? Perhaps now is the time to consider using Invoice Discounting to fund your future expansion plans.
- Is the time right
Choose your timing carefully to expand. Each business has to go through various phases and it is important to recognise what phase your business is currently in. What are market conditions like not only locally but also internationally? Are there any worrying trends which could indicate another slowdown is on the way – if there are would it not be more prudent to continue your business as is and put off any expansion plans until you feel a lot more confident of a positive outcome?
- New market development
For a business to survive it needs to be continuously re-inventing itself and launching new product lines or services to meet market demand and needs. This takes time and careful consideration, a good knowledge of your industry is required supported by research data and information. Consider companies such as Kodak or Polaroid – did they ever envisage that one day photographs would be taken on a phone digitally and viewed on a screen rather than printed on paper?
- Time to write up your Business Plan
Whether you have a small or large business it is important to do the research and to develop a business plan that will be in line with your vision and goals or otherwise how will you know if you are on target and meeting objectives. If you RE overwhelmed by the thought of producing a Business Plan why not engage with an external consultant or coach who can assist you and has the experience of doing similar for other growth orientated companies.
If you are thinking of expanding your business and need funding why not consider Invoice Discounting as an alternative means – our team are available to advise you on the options and what would be right for your business.
Celtic Invoice Discounting are the largest independent financial provider of transactional based invoice discounting in Ireland. We have been doing it for over 20 years – helping clients build bigger and better businesses in Ireland.
Give us a call on 01 230 0866 for a confidential, non-committal conversation.