Business Planning Advice
Planning for Success
Written by Anne Hauser for Gaebler Ventures
Be careful what you wish for. Business success can tank your business if you are not prepared for greatness.
In his book Small Business Management, Michael Ames says one of the main reasons small businesses fail is failure to cope with unexpected growth.
While success is great, overnight success can hurt a business if there isn't the infrastructure, money or management to back it up.
Take Twitter, for example. This web-based social networking company got so popular so fast they their web servers couldn't keep up. For a while, they had a bad rep for system problems, and they may have lost quite a few potential users as a result.
Preparing for Success
Businesses on the verge of a popularity explosion can learn from the example of Bag Borrow or Steal, a small business that planned ahead for its success.
The company allows shoppers to borrow handbags for certain periods of time from one another online.
In a stroke of good luck, their Web site was featured in the hotly anticipated Sex and the City movie. Luckily, they were tipped off to this fact and had a little time to prepare.
Before the movie came out, Bag Borrow or Steal updated their website hosting infrastructure and added employees to be able to handle the increase in site traffic. They also added a Sex and the City link to their site to capitalize on the promotion - brand stealing, as some call it. As a result, they were well prepared for the surge in business and were not victims of their own success.
How to Deal With Success
In some of her writings on small business, entrepreneur Rosalind Resnick has offered these tips on how to handle overnight success like a pro:
- Take a deep breath. Don't do anything rash to celebrate your success-- success could lead to the need for more capital in the near future, so keep a level head and keep working hard.
- Make a strategy. Immediately begin to figure out where this success will take you, how many additional employees or resources you may need, etc. Be sure to learn from your mistakes while mapping out a strategy. Meet with your team and discuss what went well and what could go better next time, and then put those changes in place!
- Get capital. If you have good credit, set up a credit line. Make sure you have capital available because you never know when you may need it.
- Network, network, network. If you need help managing your success, hire independent contractors or freelances because you never know when your success may end, so you may not want to commit to full-time employees. Make partnerships with companies and people that can assist you-- contact trade associations in your field to see who can help you.
- Leverage your success and invest for the future. You never know how long your success may last, so take steps to prolong your brand, without overextending it. Most importantly, carefully plan for the future. Whether or not your success keeps up, you want you and your business to be prepared.
Anne Hauser is a freelance writer who is currently a double major in Magazine Journalism and English at the University of Missouri.
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