The small business scene is booming right now and it can be an exciting one to venture into. This is because it usually involves people doing things that they are truly passionate about. When you care about what you are doing it is as if you aren’t even working. Of course, this won’t be the case because even doing something you love every day can get trite. Whatever the situation is, you have to know and understand that a lot of small businesses simply don’t make it after a mere couple of months. While there are a number of reasons for these failures, some of them can be attributed to the fact that the owners just didn’t understand the growth cycle of a small business. Luckily that is exactly what you are about to learn so you can avoid making the same mistakes.
Stage One: Existence
This is without a doubt one of the most challenging stages. And, it is because you will be handling most of the workload. One of the biggest hurdles during the existence stage is trying to stay in existence. This is why it is called existence. You are out there scrambling trying to obtain customers and deliver on the products and services that you are promising. If you want to remain alive and move on to the next stage, you’ll have to add new customers to your repertoire.
Stage Two: Survival
At this stage, you will likely have already established some kind of customer base. The biggest hurdle here is to ensure that you are making a profit and that it remains. Therefore, you’ll not only need to be looking for new customers again, but you’ll need to be motivating the ones that you already have to come back. Simply put, staying open isn’t enough anymore. You must establish systems and processes to ensure a return on investment.
Stage Three: Success
Once you have reached this stage, you’ll be where Blackjack Genie currently is. This means that you’ll be established with consistent profits. The question will now become, whether you want to expand or simply try to maintain the success that you’ve already earned.
Stage Four: The Take-Off
This is when the business really starts to flourish, even if you haven’t pushed it. You’ll now likely require an increase in capital in order to accommodate the volumes of customers that you have come in. This means that you are going to need to take on more staff, get more equipment and materials, and establish more effective processes and systems. At this point, you really have the option of going from a small business to a larger company. Just keep in mind that there is still room for failure, so you are bo no means out of the woods yet.
Stage Five: Resource Maturity
You’ll know once you’ve reached maturity because you’ll now be ready for diversification. Simply put, you are going to be bigger and running at a much slower pace. This does not mean that you won’t be able to react to market changes though. In fact, this is the reason for diversification and finding other related markets or products that you can potentially tap in to.
By: John Pearson
John is a serial entrepreneur and writer who is passionate about helping small businesses launch and grow. His work has been featured in Huffington Post, Entrepreneur, and Forbes.