Is your business ready to tackle the challenges that come with growth?
Businesses in the tech, digital and creative space have so much potential for growth – which is exciting, but business growth also comes with a myriad of challenges. It’s important to be aware of these obstacles so you’re prepared to address them head-on when they arise. Here are three common challenges faced by businesses in a growth phase, along with some tips on how to tackle them.
Growth-phase business challenges you’ll need to tackle
#1 – Cash Flow
A key challenge that technology businesses face during growth is managing cash flow. This can be tricky because, as your business expands, you often have more expenses and may not yet have increased revenue to match. This is part and parcel of the expansion process and doesn’t mean you’re being reckless or overspending, but nonetheless, it can put a strain on your finances and cause significant stress.
Here are a few things you can do to manage cash flow during this time:
- Review your expenses to see if there are any areas where you can cut back, even temporarily, in order to free up some cash.
- Take advantage of credit products like lines of credit or business credit cards, which can give you access to funds when you need them.
- Try to negotiate longer payment terms with your suppliers so that you have more time to generate revenue before having to pay them.
- By taking some proactive steps, you can help ease the pressure on your cash flow and keep your business running smoothly, even as you invest heavily in growth.
#2 – Quality Control
Another challenge businesses face during growth is maintaining high levels of quality control. As your business expands, you may need to outsource some work or bring on new team members who are not as familiar with your standards and procedures. This can sometimes lead to a decline in the quality of your product or service.
Here are a few things you can do to combat this:
- Be clear about your standards from the outset. When onboarding new team members or working with new suppliers, make sure they are aware of your expectations and what you consider to be acceptable quality.
- Set up systems and procedures that everyone must follow in order to help ensure consistency.
- Conduct regular audits of your product or service, both internally and externally, to make sure that quality standards are being met.
By taking some measures to proactively manage quality control, you can help ensure that your business continues to produce high-quality products or services, even as it grows.
#3 – Budgeting
When your business is growing, it can be difficult to calculate and keep track of your budget. You may have more (and more complicated) expenses than you did in the past, and your revenue may not yet have increased to match. As a result, it’s important to be diligent about tracking your budget and making adjustments as needed.
Here are a few tips for managing your budget during a growth phase:
- Review your budget regularly and make adjustments as needed.
- Keep track of your actual expenses and compare them to your budgeted amounts.
- Make a forecast for the upcoming months so that you can anticipate any changes in expenses or revenue.
By staying on top of your budget, you can help ensure that your business remains financially healthy as it grows.
Atek’s Support for Your Growing Business
The tech industry is renowned for its fast pace and constant change – and you need to ensure you’re in a strong financial position to keep up. As your business expands, you will likely face a number of new challenges. If you would like support as you address these issues, please give us a call. We have supported hundreds of companies to successfully grow their business – both early-stage and more established firms. We can help with day-to-day administration as well as provide more strategic financial support to help you make smarter decisions. Contact us to get started.
