Column: Is growth always good?


Your small business is booming, and you have a seemingly endless string of product orders or requests for your services. That is good, right?  Well, at first glance, yes, it is. However, there is such a thing as too much success too soon. If you are not ready to handle a sudden ramp-up in business, you may risk short-changing your customers with poor-quality work, poor service and missed deadlines. The added costs of meeting this demand may negatively impact your profits, turning what should be a boom into a bust for your bottom line.

Managing growth in your business means making good decisions and doing the necessary planning to know your limitations. Understanding an upswing in business is the key to being able to grow and prosper, with an accurate picture of where everything stands. Is this a temporary spurt or the start of a sustained uptick in business? Knowing why your business has increased can help you adjust to the additional production requirements or service hours needed to handle the change in your work flow.

What resources are available to help you meet this demand? Are other suppliers, namely your competitors, ready and willing to step in and help you out by covering the increased service requests or products?  Does your company have the kind of relationship with your competitors to be able to count on assistance from them in your time of need? If so, how much will utilizing these suppliers cost? Weigh your options against your cash flow and other resources. Perhaps jobbing out a certain portion of your backlog for customers who can afford to take a later delivery of products or services is a more cost effective strategy.

In any case, give your customers as much lead time as you can regarding your inability to get their products or services to them. Explain to your customers that you are short on manpower or inventory and specify how long they may have to wait before you can fill the order or take on the assignment. Some customers will be more than willing to wait, and others will look elsewhere. Many customers will appreciate your efforts on their behalf and remember you as a problem-solver. Handing off some of your overflow to your competitors in this situation could strengthen your relationship with them, and may cause them to return the favor down the road.

Periodically analyzing your processes and capabilities can save you money, time and effort. It could be the difference between keeping customers and losing them. Always bear in mind that it costs your company far less to keep a customer than to replace a customer. Stay ahead of “getting what you wish for,“ and make it part of your ongoing business management.

For more information about planning for growth and other business management issues or to learn how you can become a Certified SCORE Mentor, contact North Central Florida SCORE  in Gainesville at; or, connect with Doug Crotty, Media Contact for SCORE at [email protected]. To arrange a meeting with a SCORE Volunteer, just call Doug at 352-213-2555.

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