Knowing When to Grow (continued)
1. Think creatively. Think about your business. How can it grow without significantly increasing costs? Is there room to add new products or find new customers that will increase revenue without increasing overhead? If you do need to expand physically, can it be phased? If so, what would you need to do first, second, third, and so forth? What are the triggers for each, and what is the return on investment for each step?
2. Review your technology. How automated is your company? What digital tools do you use to monitor inventories, orders, payments, staffing, floor operations, sales, etc.? Where can you add artificial intelligence and predictive tools to increase efficiencies, such as reducing excess inventory, decreasing operational costs or improving product development? What off-the-shelf tools can be used to automate or streamline activities and processes, including decision-making.
3. Run a SWOT exercise. As you consider various growth scenarios, do mini SWOT analyses to assess the strengths, weaknesses, opportunities and threats for each. Pay particular attention to weaknesses and threats in this exercise since these may be deal breakers for a specific strategy for growth. Feel free to use our SizeUp tool to help you analyze your market.
4. Reimagine your supply chain. You can make all the plans you want to grow, but all of it will be for naught if you can’t get the raw materials, parts and products you need. As you think about growth, think about alternative ways to build a supply chain that has built-in redundancies so you can scale flexibly without having too much or too little on hand at any one time. Do some research on local or partners who can help you build capacity and redundancy at the same time.