Business growth presents a huge challenge for Food & Beverage (F&B) business owners. Sustainable growth requires careful forethought and preparation; you can’t build a solid house on shaky foundations. It’s easy to get swept up in all the excitement that accompanies business growth, but remember to take the time to prepare and organise your business to ensure that your growth is sustainable. The last thing you want to do is to end up damaging the business you have worked so hard to build. Let’s take a look at how to prepare your business for sustainable growth.
Create the Right Team
As your business grows, the demands upon your team will change significantly. Your team may be working well right now, but you need to consider how much extra support they will need as your business grows.
When hiring, don’t just look for skills and talent. It’s important to take an applicant’s mindset into consideration, too. You can provide training to bring an employee up to scratch, but it’s very difficult to reset a negative attitude.
As your team grows bigger, management will become more complex, too. You will need to consider implementing new systems and standard operating procedures to ensure that your team can continue to function at its best as your business expands.
Update Your Infrastructure
You will need to scale your IT infrastructure in line with your business. Of course, this can be a very expensive process and may require you to hire new staff, which is a big drain on your resources.
Often, however, you can find cloud services to support your essential business functions, such as CRM software, HR management programs and email services. Cloud services are easily scalable and can help you to avoid many infrastructure-related growing pains as your business evolves.
Manage Your Books
Financing planning is a crucial part of planning for business growth, but before you can make a plan you need to get clear on where you are right now. This means updating your books and making sure that all of your records are impeccable – a task which many business owners tend to let slip.
You should always aim to establish a strong payment history with lenders to enable you to borrow more in the future. Cultivating a good relationship now will really pay off further down the line. It’s also important to pay your bills on time and maintain separate business and personal bank accounts to prove to lenders that you are fiscally responsible.
It’s always wisest to borrow when the going is good. You should arrange some credit now so that you can access it as and when you need it, rather than trying to secure funds when you’re in a difficult spot. Building credit before you need it puts you in a better position to shop around with creditors and negotiate better interest rates, too.
A good way to do this is to take out a line of credit, which is a pre-set borrowing limit. It is there for you when you need it, but you won’t pay interest until you actually borrow. You can then pay it back in increments over a set period of time, much like a traditional bank loan.
For more flexible options, consider arranging an overdraft and business credit card to smooth over short-term cash flow issues. However, bear in mind that these credit options are not suitable for long-term borrowing.
When anticipating a period of business growth, it’s important to ensure that your team is primed to handle growth and that your IT infrastructure can support the increased demands that it will incur. You should also ensure that you have access to plenty of credit and that your records are in good order so that you are able to make the right financial decisions at the right time and protect your cash reserves. Business growth certainly comes with its fair share of challenges, but good preparation is the key to profitable and sustainable growth.