Does operating your business these days remind you of spinning your tires? Are you generating a lot of activity but not moving forward? Believe it or not, this could be a good sign. It could mean that you are ready to move from one stage of business growth to
next.Experts identify three main stages of business growth. The Startup Phase is time when you get your business up and running, locate customers, make sales and essentially, try to get money coming in. Typically, at this point, you are an Owner/Operator.
The next stage is Early Stage Expansion. In this phase, your business experiences "growing pains" similar to ones I will discuss below.
In third stage, your business moves from Owner Operated into Management. In other words, your function is that of manager.You are no longer involved in day to day operation of running business or of producing product or service.
Experts claim that only a minority of small businesses move into third phase. Therefore, today's article will address ways of managing growth as you move from Startup into Stage Two.
You know its time to look for ways to manage growth if any of following apply:
1.You have steady income and regular sales but you are working too hard. You are investing "sweat equity". You know that if you continue working at that speed, you will burn out, lose productivity or worse -- become ill. It is time to find a way to increase growth while working less.
2.You are running into cash flow problems. Often, cash flow problems are caused by need to invest in inventory or in product development, or to cover payroll. However, while money is being spent on above items, payment for sales is delayed until product is developed, delivered and invoiced. That is, you have capital assets (equipment, inventory), but cash is flowing out faster than it is flowing in. In this situation, you will need to find a way to manage by generating an influx of cash while continuing to develop your products or services.
