It is not always easy to grow an entrepreneurial business. For the first few years the founder and executive team’s passion drives them. But does the market believe enough to support and grow the business? Is their invention, undertaking, product, or service required? Even when the company is selling products or services it can be a constant struggle to survive. Profit is not always achieved as was hoped, expenses grow ahead of revenue, and cash seldom grows fast enough to fund continual growth.
Many founders and entrepreneurs become tired of the daily fight. Eighty to ninety percent give up.
- Exhausted from fighting the good fight and their idea no longer feels exciting.
- Decide they need to “find a job again” to pay the bills.
- Don’t know how to get cash, or where to turn, to continue operating or growing (they may have been rejected by lenders or investors).
By three to five years most businesses are liquidated or “paused” at least temporarily.
But success IS possible! We CAN change this statistic. We MUST change this statistic.
Successful entrepreneurs, before they reach this stage, find or are advised to speak with a business coach or experienced financial executive who can assist with identifying areas or ways to refocus, streamline or free up cash. The growth and success then recommences.
The solution often lies in four main areas:
1. Narrow focus to a smaller niche
Whether a specific market or customer segment, part of the product or service catalogue previously available, or even a specific price band identified as the area of greatest profit, least tied up cash, maximum uniqueness, etc.
It feels wrong to focus smaller and expect to derive greater success. But by completing the analysis and focusing in the right area it is possible to:
- remove market confusion,
- avoid having profitable products subsidize unprofitable ones,
- increase the focus on the right, profitable, or least resource hungry offering,
- even perfect your sales pitch or templates when you reuse and do not repeatedly recreate.
- Increase profit and optimize the way cash is tied-up in working capital and assets.
2. Solicit expert help and support in the area of greatest need
Often the expert’s fees are far less than the business’ benefit from solving the problem, removing risk or obtaining new ideas. The expert more than pays for themselves. For several companies this expert advice or assistance may be in sales, marketing, finance, or human resources. Many management teams feel these functions in the business are mere costs, overhead, but when a highly skilled or experienced person provides targeted help or advice
- they do it in less time,
- they focus-in on the area of greatest advantage or risk, and
- they address it fast and efficiently.
Other members of the business team no longer struggle, or split their time. They don’t remain oblivious to risk until it is too late. There is less possibility that something remains unknown (the old saying – you just don’t know what you don’t know).
3. Create strategic collaboration
Working with a competitor, supplier, major category of customers, or other large group may deliver an advantage in business returns, growth or even creation of a new market by educating that market about a need the customer did not even realize they had until it was solved. (Think Steve Jobs selling dreams, personal experiences, and status. It created a market for Apple by educating that market about a need the customer did not even realize they had.)
The collaboration may grow sales, profit or efficiency for one or both companies, or in some situations it grows the overall size of the market. They may cross-promote each other’s products, grow awareness, share marketing, learn from each other’s mistakes, write for each other’s blogs, or even directly promote each other where it enhances demand for their own offering.
4. Remove busy work
Create effective efficiency. Get team members focused on the maximum number of tasks they enjoy and thus perform well. Avoid splitting their time to also complete the “have to do” tasks. This removes procrastination, distraction and delayed progress. Often getting one or more part-time people to do several “less liked” tasks is highly effective; the tasks are usually the ones these people love to do. Sometime it is by looking for ways to automate repetitive or routine tasks that busy work is removed. Every person becomes energized when they are doing what they love doing, everyone is supported as all business tasks are done well, and the rewards stream in.
Some of these solutions really do feel counterintuitive.
They go against what entrepreneurial instincts are saying. After all …
- Why would you spend more cash when short of cash?
- Why would you add an overhead expense when the expenses already exceed revenue?
- Why would you want to work with a competitor?
- Why would you narrow your focus or “give work away” when you don’t have enough work?
But these ideas DO work. They attract business and profitability. Give one or more a try!
If you are ready to grow your entrepreneurial business we can help. Here are four ways:
- Subscribe to the Unlocking Business Growth podcast to hear from other companies that have overcome growth hurdles they have experienced. Subscribe in your podcast app or here.
- Get your free copy of the new book The 5 F Strategy – Bottom Line Growth in Any Economy without Additional Sales and Marketing.
- Download a copy of the Financial Growth Scorecard to assess your company’s current success status and what to work on next.
- Work with us to achieve the growth and success your company is truly capable of. To find out if we’re a fit schedule a free call.
