My eyes are perpetually bigger than my stomach.
When presented with an array of food options, I go for everything—the burger and the hotdog, the steak and the chicken, the brownies and the cheesecake. Inevitably, I end up feeling miserably full and wishing I’d gone to that nutritious salad place instead of Buffets-R-Us. Running a small business can be a lot like trying to decide if you should go back for a third mini ice-cream cone: you’re awash in opportunity, but it isn’t necessarily prudent to say yes to everything that comes your way.
This can be particularly relevant when seeking funding. Lenders and investors want to see a healthy mix of scaling and projecting, so preparing to meet with either one is going to require deliberately positioning your company as full of potential but not overreaching. A balanced business plan is going to go a lot farther towards securing capital than an unrealistic and overly ambitious one. So what does scaling mean, exactly? In part, it can mean saying no to business deals that are going to require resources disproportionate to the potential gains, no to partnering with businesses that don’t share your company mission and philosophy, and yes, no to potential customers. Here’s a list of some of things your scaling business should say no to.
- Accepting every new customer that comes your way. Saying no to new business seems counterintuitive, particularly when you’re strapped for cash and trying to demonstrate to lenders that you have interested customers. This article from the NY Times Small Business Section features small business owner Katie Finnegan, one of the founders of Hukkster, a company that alerts customers to when their favorite online products go on sale. She notes that she and her business partners are focusing on “tackling no more than three strategic objectives at once,” and that if a potential business opportunity or customer doesn’t help her meet one of those objectives, she doesn’t engage. Over-extending yourself to customers who aren’t serious about buying or who are looking for something different than you can provide isn’t going to help your business grow; it’s going to drain your resources and your team’s energy and morale.
- Making things more complicated for the customer. Though you might not work with every customer who comes your way, your customer base will grow as your business expands. As business operations grow more complex on your end, keep the path between your customer and your product or service clear and defined. Don’t redesign a flashier sale model if it means customers are going to have to jump through more hoops; keep it simple and your customers will keep coming back.
- Adopting a stuffy corporate voice. I’ve written before about the advantages small businesses have when communicating with customers: they can be personal, lively, and engaging in ways that larger corporations may not be able to. As your company grows, recruits more professionals, and becomes more visible, stay true to your company’s original voice. Organic, real communication will demonstrate a commitment to your core values and prove that even though you’re growing and changing, you won’t lose sight of where you came from.
Perhaps the old adage, “everything in moderation” is relevant even in business. Don’t say yes to everything—stick to your objectives. You can leverage a demonstrable commitment to not straying from your company’s goals as a way to garner the trust of a loan officer, opening the door to real potential for growth. Pick the salad, not the entire buffet.
Photo credit: jenster181, Flickr