If you are the owner of a startup business, think about this. Your company and all power to you for starting it is one of 5.5 million others in the UK. Collectively, the output of those five million-plus enterprises is a whopping £2tn.
What might both surprise and shock you is that just 36,000 of UK enterprises produce the most significant chunk of revenue within the £2tn figure quoted. So, how can you take your company from being a micro business with revenues to match to an established, fast-growing SME?
Here are three proven methods.
(1) Concentrate on what you know and do best
When you start a business, you know clearly what it is you want to achieve and who you specifically want to help. Imprint that mission on your heart and on the hearts of all those who work with your business in any capacity. Why? Because clarity of purpose is a powerful aid to staying on track and avoiding diversion.
Diversion can come in many forms. Other businesses inviting you to join their mission before you’ve advanced yours to profitability is one. In the US, this is called shiny penny syndrome. Jumping from one bright idea before completing the one you started.
You have to stay on track to ensure that your business not only survives but thrives. Thriving is one of the keys to fast growth. It brings with it the most vital of all startup success ingredients, cash flow. Concentrating on what you do best should also lead you to consider outsourcing tasks or functions that take you and other key members of your team away from the core tasks of the business. Things like bookkeeping and accounts; IT, HR, design, even manufacturing can all be outsourced and handled more efficiently by experts.
(2) Invest in the sales force of your business
Sales are the lifeblood of any business. Without sales, you have no clients and without clients the life expectancy of your business will be short-lived. Many founders are the lead salespeople for their companies, and that can be both a good and a bad thing.
It’s good if the founder is a great salesperson with skills that produce results, but bad if they aren’t. Only you can assess your strengths and weaknesses in this area. If you aren’t as strong on sales as you’d like to be or if the time you can spend on selling is diminishing, bring in skilled help.
It doesn’t matter if the help you source is freelance or an employee of your business but go for the best skills that you can afford and incentivise results as strongly as you can. A robust financial incentive to close as many sales as possible works to your benefit more so than that of the salesperson.
That’s because you, the owner of the business, will enjoy the lifetime value from every new customer your salesperson or team wins. Those initial orders may lead to client relationships lasting many years and collective profits of extremely high value to your business.
Keep that fact in mind when you think about how you incentivise your sales force. You want to ensure that they are highly motivated to chase down every possible client that comes their way.
(3) Use outside funding to keep your business growing
Cash flow already highlighted as the lifeblood of any business is particularly critical for firms that want to grow fast. Money will be needed to fund the plant, equipment or people talent that will keep an ambitious business ahead of its rivals.
One mistake that successful business owners highlighted to us over at Festival of Enterprise when researching the Fast Growth Report was not borrowing money soon enough. That reluctance is understandable, but as they confirmed, it can put the brakes on growth.
Our research highlighted different paths to finding funds for growth. Finance from banks, angel investors, and even a pitch on Dragons Den were all paths used to attract growth funding and external expertise.
Alistair Callender, the founder of GATE8 Luggage, took a different approach. GATE8 makes cabin bags for people who value fast check-ins and exits from airports when they fly. When he started the business, Alistair had a young family; this made him risk-averse and reluctant to take a loan from a bank.
He couldn’t fund his ambitious plans from cashflow so, he found a partner with a proven track record in building a successful international product-based company. For Alistair, giving up part of the equity in his business in exchange for money, mentorship and experience was not an issue for him.
It’s been a very successful arrangement and he’s very happy he took this route.
This article comes courtesy of the Festival of Enterprise, the festival designed to provide the owners of established SMEs and startups with the tools and information they need to achieve fast growth.