Some small business owners eat, sleep, and dream growth. Others, well, they’re happy to keep things as they are, or are content to slow things down when they need to. Where do you fall on that spectrum? Do you panic when you hear the phrase “slow down”? Do you scratch your head and wonder why any small business owner wouldn’t strive for the same frantic pace as you? If so, it’s worth taking a look at why some entrepreneurs choose not to grow, as well as to think about the times when you might need to take a step back and slow down, so you can decide whether continual growth is actually right for your business (and for you).
The Decision Not to Grow
Small businesses are the backbone of our economy, generating around 50% of GDP in the U.S., as well as creating jobs and sparking innovation. That’s a lot of work for you entrepreneurs to shoulder! There can also be constant pressure to grow, whether it’s right for you and your business at that time or not. But while some business owners decide that they need to continually grow their business to stay competitive, others make a conscious decision to put the brakes on. Why?
- To avoid risky business – As your business grows, so do your financial obligations. For example, you might need to hire more employees (or do some outsourcing), buy new equipment, or find a bigger space, and you might find that you can’t increase your revenue enough to keep up with these increased financial demands. In addition, if you’re selling a product, you’ll have to tie up more of your cash in inventory, and you’ll have to work hard to increase sales numbers to keep up your cash flow. Expanding into new markets or locations, or launching a new product or service, also carries a lot of risk, especially for small businesses that won’t be able to absorb the cost of failed ventures like a larger business would be able to.
- To stay true to their standards – One of the great things about being a small business owner is that you can really focus on what matters: product or service quality and customer service. In fact, that’s often what sets you apart from all the big businesses out there! If you shift your focus to growth and then need to fulfill more orders or deal with more and more customers, your business could end up getting stretched thin, meaning you run the risk of alienating customers who come to you looking for that “small business touch.” The negative reviews you end up with could very well be counterproductive, and all your efforts at growth might go to waste.
- To maintain their lifestyle – Growing your business will not only mean risking your hard-earned assets, but it will also mean changing your lifestyle. You might have to work longer hours and make a bigger commitment to your business – not to mention that you could end up stressed out (and therefore more likely to make decisions on an emotional basis rather than on a well thought out and strategic basis). Before you decide to make big changes toward growth, consider your work//family/life balance and make sure it’s the right time for you.
- To retain control – Every small business owner has a different way of running their business: some are happy to delegate a larger proportion of day-to-day operations to employees, while others really prefer to retain control of most decision making. What are your feelings on handing over the reins to others, at least partially? If you grow your business, you’ll most likely have to give up some control, so if you would prefer to retain control over most aspects of your business or are not interested in becoming a delegator-in-chief, you might want to hold off on any rapid growth.
While these are all valid reasons to keep things as they are, we’re definitely not saying you shouldn’t be shooting for growth, but you should always consider the above before you make any big changes. That being said, there are times when you definitely should stop and take stock before you move forward with any growth plans.
Should You Slow Down?
Well-known entrepreneur and venture capitalist Paul Graham once famously said, “The only essential thing is growth.” Well, we’ve seen now that not everyone agrees – but even if you do, and you don’t think that the above reasons are compelling ones for periods of slower growth, you should still slow down from time to time long enough to set your goals and figure out how to reach them. So, regardless of your long-term growth goals, when should your business actually slow down?
- When you’re hiring employees – If you’re looking to fill a vacant position, especially one that is essential to your daily operations, you might be tempted to speed through the process so you can go back to focusing on your growth goals. Don’t! There’s nothing more counterproductive than hiring too quickly – you run the risk of ending up with a less than ideal employee, and you’ll have lost a lot of time and money in the process.
- When you’re trying to acquire new customers – Growth and acquiring new customers go hand-in-hand, right? Sure, but if you’re not acquiring the right customers, your growth could end up being a bubble that bursts pretty quickly. For example, if you’re just firing out promotions that attract one-time customers, you should slow down and rethink your marketing strategy. You need to come up with ways to attract customers who need your product or services, who will keep coming back for more, and who will tell their friends and family about you.
- When you’re putting out a new product – Do you have a great new product that you just have to get to market before your competitors? We understand the temptation to rush, but this is another time that you should take a step back. If you’ve built a following based on the quality of your products, the last thing you want to do is put out a product that isn’t quite ready and might have problems that you haven’t had a chance to work out yet. Don’t risk your reputation, slow down and get it right the first time!
- When you need a change – If your business is stuck in a rut, but you want to grow, you might need to regroup. You might need to reach out to new markets, come up with new products or services, or pitch new ideas to clients or investors – and that means taking time to learn and experiment. It also means writing up new business plans or growth goals, so you’ll have to refocus your energy on doing that.
- When everyone needs to recharge – Growing your business can be exhausting! For you and for your employees, so remember to slow down and take stock every now and then. Check in with your employees and see how morale is, and make sure you’re recognizing them for the hard work they’re putting in. Make sure also that they’ve still got sight of your business’ mission, and that you do, too. Take this time to slow down and ask yourself things like: Have I reached my old goals? Is it time to set new ones? Recharging your growth battery is never a bad idea!
Launching a growth strategy is never something you should do simply because, well, you think you should be doing it. Make sure you can cover the costs, handle the impact on your lifestyle, and maintain the standards that your small business is known for. But if you’re ready, go for it! Just remember to slow down when you need to, so you can get right back to your growth goals.