There are few better feelings for a budding entrepreneur than to see that all the time, effort, and stress of setting up a business appears to be paying off and has serious potential for expansion. It often takes a little while before start-ups start to generate a profit; the temptation to expand as quickly as possible is an understandable one – but this needs to be approached carefully. There’s no shortage of options in raising finance, extending the company’s profile and enhancing market share – but not all are necessarily relevant or appropriate for all businesses. Take as much care and consideration of the following tips and suggestions as you might have when founding the company.
Use social media to build relationships
Whichever platform(s) seems most appropriate for your business, be sure to interact not just with customers via blogging and such but also try to build relationships with influential voices in the sector. Having a well-regarded commentator post a good review will generate much more interest than you may expect – both for new and existing customers. This is valid whichever sector the company operates within – just try to choose the most relevant of the social media sites (Facebook and Twitter are middle of the road, LinkedIn more professional, Snapchat for younger markets, etc.). It’s the future, and if the company is going to grow, then social media must be embraced.
Of course there’s no point generating a buzz without the capacity to meet demand. On a practical level finance is going to be required to hire more staff, expand premises and purchase/lease new equipment. The good news is that there are plenty of options here away from going begging to the bank. Loans are much more difficult to secure nowadays and if choosing to raise finance through this traditional means, be sure to have comprehensive evidence that the company is an exceedingly viable concern. Alternatives may be:
- Public sector grants are available where expansion will benefit the local economy. This is especially the case in more deprived areas with significant unemployment.
- Local business groups often have a pot of funds to help young businesses expand, especially where the company is performing a cutting edge or socially progressive role.
- Raise finance through asset management companies – they buy equipment and lease it back to you.
- Private investors (think “Shark Tank” or “Dragon’s Den”), just be ready to drive a tough bargain.
- Family and friends might help at a better rate, but of course this comes with added pressure.
How to invest funds in stimulating growth
However the finance is raised, it’s no use unless it’s invested wisely. Sure, you may need to expand premises and hire more staff, but there’s more to it than this alone. A company needs to expand with the following in mind if the venture is going to continue being successful:
- Keep existing customers and contracts on board. Inform them of your success and growing popularity – social media is a great way of portraying this – and even offer reductions if they order more from you as a loyalty bonus. These clients are the foundations of the business and all efforts ought to be taken to retain them.
- Get into new markets and open up new revenue streams. The most obvious of these is to sell products online and make regular updates on social media to promote this. Think big – could the company go international? Is there scope for franchising?
- Get out there and network, be proactive in using new media to advertise for staff and don’t be afraid to approach other businesses to suggest sharing ideas and experience. There’s a wealth of online groups that cover every imaginable sector – get involved and keep raising the company profile. Being a ‘buzz’ company in a sector is likely to make you appealing to the best talent.
Always look for ways to run more efficiently
One of the biggest pitfalls in expanding a small business is losing sight of the internal structure of the business, allowing it to become bloated or confused. It’s extremely important to expand following a clearly planned structure to keep departments organised and as streamlined as possible.
A great way to help a company effectively deal with its human resources is through investing in a comprehensive HR setup that will manage not just recruitment and retention, but also address needs regarding training while monitoring the efficiency of departments. Take some time to learn about HR systems; when used well they can perform a huge range of administrative functions while also presenting KPI and associated data in an accessible manner. Such technology can save many thousands of pounds that would otherwise have been spent on unnecessary payroll or even outsourcing.
So embrace technology and social media – they’re not just going to be essential for your company to flourish in the future – they’re essential now.
Lindsay Edwards is a writer who enjoys writing about finance and HR and is a fanatical money saver. She is an aspiring traveller who enjoys visiting different countries to experience their food and culture. Her core focus is human resource, entrepreneurialism, economics and lifestyle. Follow Lindsay Edwards on Google+.