What a crazy thought. Who couldn’t handle more money, more visibility, more fame, and a larger share of the market? The writer of this blog must have lost his mind.
It does seem like a foolish thought, but then I look back on various companies I have worked with who were on the brink of tremendous growth. But the results of the opportunity varied. Some soared. Some struggled. And for some, the opportunity became the reason for their demise.
But why? My work has found several reasons such as:
- Overwhelming demand – Companies just aren’t prepared for the onslaught of people, orders, etc. Extra suppliers have not been lined up or even discussed. Production lines are not ready to ramp up. Raw materials are not available soon enough. New employees cannot be found. All of these and more have not been planned for.
- Competition moves in – If it looks like there is money to be made in the long term, you can fully expect other owners to try and capitalize but producing the same or a similar item.
- It’s a fad and not a trend – Yes, it’s a great item today but does it have legs (will it go on)? Being a fad can have two negative impacts on a small business. The first, already discussed, is not being able to move fast enough to capture the market. And the second is that you moved quickly enough but then the fad disappears and you have unused inventory, raw materials, a closed production line, etc. And as a small business owner, you probably have not had the time to come up with the next hot item.
- Failure to protect your advantage – Have you taken the steps to make sure no one else can hone in on your market? This may be a legal safeguard such as a patent or copyright? And have you trademarked the name, your brand, and your logo? You can also tie up certain suppliers and raw materials so that access to them is limited for anyone else.
- You lost sight of your goal – In growing the company, the culture changes. Your business isn’t the great place to work anymore. Or you get so caught up in covering today’s demands that the reason your started your business gets lost in the shuffle.
The bottom line is that while success is great, it comes at a price and it creates new demands. The most common expression from the owners I have met who have experienced tremendous growth has been “I never knew…”
Success takes planning, not only planning to get there but planning on how to stay afloat when you get there. Just as you plan for how you will pay the bills tomorrow, you need to plan for the possibility of your business taking off.
Ask yourself, “Success!! Are your prepared??”
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Glenn Muske is an independent expert on rural small business, working as GM Consulting – Your partner in achieving small business success. He provides consulting, and writes articles for county extension agents and newspapers across North Dakota. Previously, he was the Rural and Agribusiness Enterprise Development Specialist at the North Dakota State University Extension Service – Center for Community Vitality.