Growth is often the fruit of hard work; however, when a company grows without a strategy, it can become a pain point for the business. During growth, the company must be flexible and make transitions to keep up with the transformation. Failure to do so could mean the end of the business. Here are a few mistakes that fast-growing companies need to stop making if they want to continue to thrive:
Mistake #1 Borrowing too much money
Just because you can borrow a lot of money, doesn’t mean that you should. Take the time to thoroughly evaluate your entire business. Make sure that there is a equitable purpose for each dollar that you borrow.
Mistake #2 Not having a financial team
Before you make any financial decisions, you should consult a professional. An accounting and finance professional will be able to break down the numbers of your business and provide the proper guidance that you need to make the most informed choices. You might, consider hiring a consultant until you are ready to add a full-time financial expert as part of your regular team.
Mistake #3 Spending too much money
Just because business is good right now, doesn’t mean that will always be the case. Most businesses have lean times, so you should make sure that you’re keeping back enough capital to help you navigate those leaner times. Until you know that your business can handle heavy spending, be money conscious about each and every purchase.
Mistake #4 Hiring “bargains” instead of “experts”
One of the biggest challenges for growing companies is the urgency they feel to hire when demand for their products or services suddenly increases. This urgency can lead to mistakes when stringing together a bigger team quickly. Some hire employees based on their pay grade rather than their expertise, which can cost more in the end. Hiring bargain staff might allow you to get twice as many employees, but if those employees don’t have the skills or motivation required to hit their targets it could cost you more in the long-run. Remember, you get what you pay for.
Fast growth does not guarantee longevity. If your business is starting to grow, don’t stop aggressively nurturing it until it forms solid roots.