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Important Considerations to make Before Launching into Another Phase of Business

Every serious entrepreneur desires to grow from their present level to the next. No matter how large the business may have become, there is always potential for growth, either in the market where it is now serving or in some other market that is yet to be exploited. Sometimes, businesses are forced to grow, not out of a desire to make more profits or help more people through their goods and services but because of the pressure from competitors. Amidst it all, we can be sure of one thing, taking a business to another level of its development is not a light matter at all. There are some vital aspects that must be considered before you grow your business to the next level. If certain factors are not properly looked into within your strategic growth plan and prepared for, the cost and responsibilities of growth may end up destroying the business. So here are some vital tips every serious business person and entrepreneur who want to expand his/her business must bear in mind and carefully consider along side their growth strategy.

Considerations on a personal level

As an entrepreneur, the greater burden of responsibilities for each successive stage of a business falls upon your shoulders. The entrepreneur or business man who first considers the cost of expansion from a personal standpoint will be better prepared to soar through the challenges that are definitely going to show up through out the next phase. On a personal level, here are some important issues to consider before taking the step of business expansion.

Time

Before you grow your business to the next level, the time factor is something that should be considered. At the present business level, how much time are you willing to spare? If your schedule is already too crowded to allow for any more commitment, there are two considerations you will have to make. You could either choose to forget about your plans of expansion for the moment or make arrangements to get managers and assistants who can keep some of the burden off your shoulders. There is not enough time in a day to do all the things one will love to do, so figure out how much you can handle and make arrangements to delegate responsibility.

Family Pressures

Family is the base of every successful business man’s endeavors, so never grow your business to the next level at the expense of family. This is one aspect of business that too many people ignore or take lightly. Every successful business man who has a family knows that success in business is closely tied to success in the family. And that means one has to be able to handle family pressures effectively. You need to spend time with your family. It is from a good relationship with family that a person is able to face the pressures and responsibilities of work.

A businessman or entrepreneur who already has problems because of their schedule with the family will find it difficult taking on a more tedious or demanding commitment to his or her job because the pressure will further strain the family relationship, making it difficult for him to succeed in business. One may feel the need to grow a business in order to provide better opportunities and make life more affordable for their family and loved ones, but what these people need more than money or material things is your time and affection. You may not be able to give as much time and attention to family as you would if the business stays at its present stage of growth. If you cannot figure out yet just how you can be committed to an expanded business and still have time for your family, it is better you give it a thought and be clear on that aspect before going on. Considering family should always be part of your strategic growth plan.

Benefits vs sacrifice

One motivating factor to business growth is the benefits that it will bring. But it is going to be a fatal error for one to look only upon those benefits when considering whether or not to expand a business. The benefits should be weighed and considered alongside the sacrifices that have to be made. Sacrifices come in different shapes and forms. There would have to be financial sacrifices, sacrifice of time, leisure and even some relationships. Sacrifice is a big word and it is seldom pleasurable. It entails a great deal of self discipline.

There is no way to grow your business to the next level without making sacrifices, but those sacrifices must bring a greater return. You are not always going to feel like making the sacrifices you may decide to make. For example, sometimes, business growth may require spending some days away from family and friends or spending longer hours than usual working. All these are things that growing a business will necessitate from time to time. There will be times when you would not feel like doing it, but you will have to do it out of commitment. You should be able to ask yourself, is what I am looking forward to gaining from this worth the sacrifices I will have to make? Is it worth the extra work, the potential strain in some of my relationships? If you can sincerely answer yes to that question, then you can move on, but if the answer is negative or you still have some doubts, then it may be better to just hold on and reconsider.

Risks

Risk taking is an integral part of any business, and especially for those that are moving towards expansion. But one cannot simply take risks and expect to succeed in business. Risk has to be calculated in order to properly decide whether or not it should be taken. There are several advantages of taking calculated risk. One of them is, you know what to expect if things work out and what to expect if something goes wrong. That knowledge of how things could turn out prepares you for the result.

Secondly, calculated risk means being able to assess at each level where things are going and to know what changes to make along the way. Going into another phase of a business without carefully considering the risk you are taking may cripple the whole thing altogether.

Skills and abilities

Usually a new phase of business means new skills and abilities have to be used. This has to be part of the business growth strategy. Do you have the skill necessary to grow your business to the next level and sustain it? It is not enough to be motivated. If you don’t have them, you will definitely have to hire them. An entrepreneur who has just one location for his business may need to learn what it means to manage a branch and what skills will be required for it to function properly. Sometimes, business expansion means going into a whole new sector. One cannot assume knowledge based on past experiences or studies. If it is a different phase of business, it will require better skill sets. For those you can learn and apply, you should take some time to learn them. You may have the right motivation, the capital and every other thing necessary for expansion but without the technical knowhow, the whole thing is bound to fail.

On the other hand, hiring skills and abilities means increased costs. So if you have to hire instead of learning those skills, then that should be included in your projected cost of expansion. The last option on the list of choices that have to be made as far as considering skills and abilities is concerned is training those who are already working for the business to give them the required knowledge and skills. Besides the financial cost of this kind of training, it is going to take time before the staff is prepared. That time frame should be included in the business expansion plans in order to see that things go on just fine.

Does it fit into your objectives

Every business has definite objectives and a strategic growth plan that are assessable using a time frame. However, it may happen that an entrepreneur sees some opportunity or possibility for growth and decides to take it without carefully considering whether or not that intended expansion phase is part of the original plan. If it was not part of the original plan, whether long term or short term, then you have take a step back consider how it all fits into your objectives. The objectives for starting a business is in other words the purpose of starting the business. Nothing great exists or works without a purpose. The purpose or objectives must guide every major decision that is made from time to time. Consequently, unless you intend to add to your objectives or change them, you should avoid business expansion plans that are not in line with them. The main reason for this is that plans which do not tie with business objectives become a serious distraction that could keep you from fulfilling your goals and seeing the business grow to the level it was originally intended to.

Is it a well planned move

The expectations may be great, the possibilities outstanding and everything just seems to fit in place, but if there is no definite business expansion plan to drive it all into realization, it is just going into be a waste of time and money. Every successful business move has to be guided by a definite business expansion plan or strategic growth plan. Some business moves are so huge that the entire team will have to plan a great deal before trying to implement them. You may not always have a guarantee that your plans will turn out right but having a plan sure increases your chances of succeeding by about 50%.

I know that sometimes a business could stumble upon opportunities that are difficult to let go of and at the same time demand immediate action, that is, without adequate time for necessary considerations and planning to be done. The more time you have to look at things from different angles and make plans, the more possibilities the whole thing has of succeeding. So before you launch into another major phase of business, make sure it is carefully planned out.

Have you met your goals for the previous level?

You see, one thing aspiring great businesses and those that have succeeded locally and internationally know is the importance of setting goals for a company or business. And those goals could be long term or short term. But goals are not set just for their own sake. They are not an end in themselves but a means to an end. Until that end is met successfully, it is not time to set a whole new set of goals to drive a new phase of the business. Lets look at it in this way, one reason why schooling is divided into classes and grades is to meet certain goal of learning that are attainable and testable at each level. Not just that, but entering into a new phase of pursuit (or in this case, class) is only allowed if there is sufficient proof that the goals of the previous level have been attained.

Supposing a student decides to skip one or two grades and goes into a class ahead, what would you expect to happen? Failure! Not because he or she does not have the potential to grow into that level but because previous levels and their goals have not been met, the student is not prepared for the next. Now back to business. Goals at each level of a business are supposed to prepare the team for the next level. Summarily, if those goals are not met, it is an indication that the business is not ready for the next phase. A business team which does not have what it takes to succeed at phase two would definitely not succeed at phase three. It is not even wise to try. The whole endeavor will be a waste of time, effort and other resources. So make real time assessments, based on the business strategic growth plan on how well your goals for the previous level have been attained and use that to decide whether or not to go ahead.

Be sure it is not emotional

I am sure you must have figured this out already, but let us consider the matter more closely. Business decisions should never be made from an emotional level. Whatever decisions are included in the business growth strategy out of emotions may not last very long. Your heart will usually be involved in what you are doing but you cannot let your heart take business decisions, especially if your head is not actively involved. By the way, I am sure you know that emotions rise and fade, sometimes they are so strong, other times they seem to fade so much so that there is nothing you can lean on. However the thing that will not fade is a decision made after careful considerations and conviction. So when you begin thinking about the next level of business, you should take some time to figure out what’s motivating that decision.

Is the right team available?

Nothing is going to replace a great team. As a matter of fact great entrepreneurs are only as good and successful as their team. So before moving to the next level, you must go beyond considering just your own level of readiness. The team too has to be looked into. It is important to assess how prepared everyone is. Sometimes though, the next business venture or level may require a whole new team altogether or at least a good number of new employees. It is great to keep those you have been working with, but that is not always possible. Other times, some other people will have to come in and others may have to leave. But the bottom line is, the business must have the right team in order to move to the next level successfully, without that team, things are going to be difficult. So the team that made it happen for the previous level may not necessarily be qualifies for the next level. Look into your team, make upgrades where necessary.

Are there better investment options

Jumping at a business opportunity is great but at the same you must consider other (probably better options). This is important for every business man because most times, taking one opportunity means others have to be forgotten. But what are you letting go of and what are you holding on to. Which of your options could be better maximized? Obviously holding on to something good keeps you from seeing something better, much less reaching out for it. Could you invest somewhere else at less cost? Is there a possibility of getting more profits if the business expands in another direction than the one you have originally intended? Making this assessment also opens you up to opportunities you may not take at the moment but include in your plans for the future.

Transition challenges

There are certain challenges associated with transitions from one phase of business to the next. No matter what growth strategy you choose to use, there are going to be some challenges that must be dealt with. Those challenges have to be prepared for in order to make a successful transition. They include some of those things we have mentioned here amongst others. Longer work time, more challenging demands, day to day pressures and financial issues. Sometimes, and especially if care is not taken, these transition challenges may pose so much problems that the entire team may just cave in under the pressure. Remember it is not just about you. The pressures of transitions will weigh on every single team member. Everyone would have to consider the sacrifices they will have to make and how it is going to affect their lives and families.

Market Capacity and demand

When drafting a business growth strategy, one of the most important things to consider is the market capacity of the business. Usually, business expansion means supplying more goods and services. But if the market where you intend to sell these goods and services does not have the necessary level of demand, then taking the business to the next level will not be profitable at all. There must be a certain level of market demand or capacity to match the intended expansion. Remember, the fact that a business is successful at meeting the needs of its customers profitably does not mean that business is ready to expand.

 Can you face competition in the expansion market?

At each level of business, there are others to compete with. You may be the leading business at your present level but it does not guarantee success at the next level. For example a business that operates in a city may intend to go national. Though it may not have problems facing its competitors at that level, there may be serious challenges facing competitors at the national level.

This should be part of the planning face, to carefully consider the level of competition at your next level and how to beat that competition. The business needs a plan that can guide it through facing its competition successfully.

Financial capacity

One last thing you have to consider is the financial capacity of the business to handle the next level. Going to the next level of business should not weigh on the business financially. Truth is, engaging in the next level of a business is best done when it is considered as a separate business that is about to start.

Every genuine business has potential for expansion and the business expansion plan should be able to guide you through it. However, those points mentioned here are specific areas that mean a lot to every business and should be taken seriously.

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