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It's been said that
the hardest task in sports is hitting a fast ball. Clearly, the folks
who say this have never tried hitting a golf ball.
Anyway, here’s my
nomination for the most difficult task in small business: Growing
to the next level when you have fewer than 5 employees.
Consider ... if you
have twenty employees and add one, that's only a 5% increase in
headcount and payroll expense. If you have ten and add one, that's a 10%
increase. But, if you only have four employees, adding one is a whopping
25% increase. What if you're the one and only person in your new
company? Bringing your first employee on board is a 100% increase in
headcount and payroll expense.
Most start-up and
very small companies are long on things to do and short on people. The
owner is frequently overwhelmed, is involved in all aspects of the
business, and is in constant "fire fighting" mode. Help is
desperately needed, but there isn't time to figure out how to best use
another person, and there usually isn't enough money for the additional
payroll. (Heck, the owner is usually underpaid at this stage of a
company's growth.)
Sound like your
situation?
As you make your
business plans for yet another year, resolve to avoid disappointment and
finally get on track. Growing beyond this awkward "adolescent"
stage is tough. It's sort of like a NASA rocket building up the speed to
overcome the Earth's gravity. Once in space, it's smooth sailing. But,
an incredible amount of energy is needed to get to that point. And so it
is with growing your small company.
Here are some ideas
for getting up to "escape velocity":
First, Work Your
Tail Off
What? This advice
from the author of a book on having a life outside your company? Yep. I
wish I had better news.
When your business is
in its infancy, there's no shortcut and no substitute for good,
old-fashioned effort. If you want to someday enjoy the fruits of your
labor, there first must be some labor. Make sure that you make
the most of every available minute.
The trap some folks
fall into is letting this approach become a long-term way of life. Work
hard but have a plan for eventually pulling back, so that soon you're
working on the business rather than in the business.
Promote Your
Business Like Crazy
Getting your business
up to "critical mass" takes a major sales and marketing
effort. Here are some things to keep in mind:
- Everybody
sells. One of the main responsibilities for you and for every single
employee is to attract and retain customers.
- Perform
at least one significant sales or marketing task every single day.
There are roughly 250 business days (allowing for holidays) per
year. If you follow this advice, growth will happen. Do more than
one a day and things will happen even faster. Discipline yourself
and set aside the time.
Systemize
Create "comic
book simple" procedures for as many business processes as you can.
Follow them yourself, and lay the groundwork for future employees to use
them also.
While you're at it,
create simple job descriptions for each major role, even if you're
filling all of them.
These two tasks will
make hiring decisions and new employee training immensely easier and
more efficient.
Use Free and
Low-Cost Help
Consider hiring high
school "co-op" students or college interns. Pay an entry-level
wage. Develop a relationship with the faculty and advisors at your
nearby schools, and have them watch for good prospects for you. Chances
are, these will be short-term employees, but you never know. You might
hire some long-term staff members right out of school.
What about family?
Does your spouse have skills and time to spare? How about your kids or
your cousin Elmer? Look close to home before going out on the street for
help.
Use Part-Time Help
Stay-at-home Moms and
retirees are frequently looking for part-time work with flexible hours.
So, be flexible.
You need a full-time
employee? Why not hire two part-timers to share one job? (Hint:
Part-timers usually get limited or no fringe benefits.)
Farm Out Assembly
Work
If some of your work
involves light manufacturing or assembly, can you send it out to a
sheltered workshop? The cost is generally very reasonable, and you'll
feel good about doing it.
Borrow
Money for Hiring
Sometimes, the only
way to afford growth is to fund it with short-term loans. Arrange for a
line of credit with your bank. Don’t think in terms of paying this
sort of loan off over a long timeframe. The balance should go up and
down weekly as you “sweep” money between this account and your
checking account.
Yes, this is a risk.
Even if your company doesn’t grow you still have to repay this money.
So, approach it with a healthy mix of caution and confidence, and
execute a well-thought-out plan.
As you get bigger –
6, 8, 10 employees and beyond – challenges remain, but you’ll have
enough people for delegating and separation of duties for more
efficiency. That’s when the real fun begins, so don’t give up or you’ll miss the best part.
Stay positive. Keep your small business dreams alive by growing in spite
of the challenges.
Bill Collier is
a St. Louis-based business coach, consultant and speaker. He is the
author of the book “How to
Succeed as a Small Business Owner … and Still Have a Life.” His
website is www.collierbiz.com,
and his email is bill@collierbiz.com
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