Scared of growth opportunities?
photo by Alan Cleaver
Business growth can be a scary proposition…obviously it’s better than business failure, but there are a whole set of fears centered around business growth and success that plague a lot of business owners.
When your business starts succeeding beyond where you’ve been for a while, you leave your comfort zone…you head into new territory (which is scary). Maybe it’s a situation you haven’t faced before (also scary). Maybe it will require you to do some things you haven’t had to do before…hire more people, find a new location, spend more money (on people, stuff, rent, etc.). And maybe it will force you, as the business owner, to do things differently…not do as much hands on work and to do more strategic leadership and planning.
All of that can be scary stuff – but I would propose there’s a better way to look at it.
I had a great conversation with a client last week who’s facing some great opportunities, including bringing on a significant new client that could be a 50% jump in revenue if it all played out. It’s all exciting stuff, but there was a real undercurrent of fear and tension as we talked about the need to bring on some additional help.
It boiled down to “How can I possibly afford to bring on that many people?”.
It’s a fair question, but it’s the wrong way to look at things because it will shut you down before you even get started. It sounds silly (especially if it’s not you in the hot seat), but changing your mindset…changing your perspective can make a huge difference, even though none of the underlying facts change.
What if you look at all of the things associated with growth as investment opportunities that have a tangible return on investment as opposed to a cost of doing business?
As an example, the exercise that helped my client turned out to be some simple calculations of how many billable hours her clients would likely need in the next 6 to 12 months that would go to the new company resources. To keep the math easy, let’s say it’s a 1000 hours of new work and the margin on each hour of work could be $20 to $40 an hour (depending on who and what they were doing).
Just using quick math and these assumptions – her margin on these new resources is going to be $20,000 to $40,000 each just in the next year, on the low end!…and almost all of that goes straight to the bottom line without hardly any extra time spent by the business owner.
That’s the beautiful leverage of a successful business.
Clearly there are a lot of things to take care of and watch out for. You have to find the right people, you have to manage the relationships and the overall level of work, you have to have a clear idea of what’s next and how you can continually improve your business. But you ought to be doing all of those things anyway – that’s your job as the business owner.
So the next time you have a chance for growth…make sure you’re approaching it with an investment mindset and not getting wrapped up in the costs and challenges.
Have you ever been scared by growth or success? I’d love to hear your thoughts in the comments below.
Shawn Kinkade Kansas City Business Coach