But you were successful. You probably managed through some tough times, however you built your business into a comfortable position with loyal customers and enough cash in the bank to pay the bills.
Life is good, but you want to kick on to the next level with your business, so you need to accelerate your sales growth. I recently talked to a business owner who was at this crossroads.
Maybe you want to enter some new markets, take on bigger contracts, diversify your product offering, or even acquire a competitor? These can be good avenues to deliver the growth you desire, but all will have some impact on your cash position. Working capital funding is likely needed to finance sales growth; investment in equipment may be needed to exploit new products or markets; acquiring a competitor will require funding. As a business owner, financing is never far from mind, but big changes like this can seem daunting.
Daunting enough perhaps that you decide to stay where you are, comfortable. But business rarely stays comfortable for long. Competitors are after your market share, new technology renders your products or services obsolete. Before long your margins are eroding, some of your customers are suddenly less loyal and your sales are stagnant or declining. Your comfortable cash position is now under pressure and you need financing, just when your business fundamentals are looking less rosy.
These issues apply to organizations both small and large. Over-extending sales growth has put many businesses under, or so weak that they are subject to predatory buyers. Companies that don’t innovate and adapt regularly fail or get “consolidated” out of existence. Same as when you started, the best path is to balance the need to grow and the cash needed to do it. Make sure you understand the full implications of your growth strategies and prepare a sound financial forecast. Overlay these projections onto your current business and make sure you don’t over-step available financing.
Finding the optimal growth path will be less stressful for all concerned, will put you in a position of strength and substantially enhance the value of your business.
To learn more, or discuss your needs, contact me at firstname.lastname@example.org or call 908-331-2987.