If you’re committed to growing your health & wellness company into a major brand, keep these five success factors front and center:
1) Be a leader and manager, not a doer.
Think about it this way: if you’re embroiled in every bit of day-to-day detail, how will you ever have enough mindshare to actually think strategically about expanding your business? And what will happen to those critical tasks if you do shift your attention to the expansion project?
Your existing business needs to be pretty self-sufficient before you expand. If you’re spending most of your time working with clients yourself, or keeping the books, or working the register, you’re probably not ready to expand.
Now, you may be thinking “But wait…I’m the only person in my business.” Naturally you’ll find yourself doing just about everything at first. But if you’re serious about growth, you’ll constantly be looking for opportunities to tap into resources beyond yourself. Remember that as a sole practitioner your time is the most valuable asset you have. You absolutely must find ways to free yourself for bigger-picture thinking and planning if you want to expand your business in the future.
For sole proprietors, this means that you need relationships with trusted outside professionals like bookkeepers, accountants, tax professionals and attorneys. You may also need to add part-time staff or contractors to handle some of your client work. And using outside help for tasks like updating your website and marketing materials often makes sense.
For larger businesses, consider slightly increasing your staff levels or finding outside professionals to handle some of the work you or your top managers are currently doing. For example, if you use lots of independent contractors, adding a part-time administrator to handle their paperwork and payments might free up some badly-needed time for working on expansion plans – say, getting hiring underway for a new location. Maybe you need to add a part-time student who can handle receiving, unpacking and reordering your supplements inventory.
2) Surround yourself with capable staff.
Don’t fall into the “mini-Me” trap. Look for people whose aptitudes and capabilities complement yours. Avoid duplicating your own strengths and experiences.
The #1 way to free yourself to grow your business is to hire capable people and give them responsibility and freedom to act. Encourage an ownership mentality and share the financial and non-financial rewards of business success.
Remember that your front-line people – the person on the phone, the person at the counter – set the tone for your clients and customers. Don’t settle for indifferent part-timers who come and go every few weeks. Pay a little more and approach hiring creatively (for example, stay-at-home moms, retirees, graduate students instead of high-school students) so that you get top-quality people who’ll stick around for awhile.
Otherwise you’ll spend all your time fighting employee turnover fires and the resulting customer dissatisfaction – and that’s time you could have spent getting ready for growth.
3) Document your SOP.
The idea is to figure out your standard operating procedures (“SOP”) for your day-to-day operations in your current location, then clone them to the new location. You’ll probably have to make some tweaks – for example, you’ll probably need some new financial controls since you won’t be on the spot – but it’s much easier than reinventing the wheel and starting from scratch. Plus, you want your existing business to keep running smoothly. That won’t happen without written processes, procedures, checklists and other tools.
Develop and document standard operating procedures – “SOP” – for your existing business before you add another location or add a new line of business at your current location. Make sure you document both key client and customer procedures (for example, the cleaning and disinfecting schedule for equipment and lockerrooms) AND key business procedures – closing out the cash drawer, for example.
We know you’re cringing – but remember, you don’t have to do it all yourself.
For example, you can delegate writing a front-desk checklist to your front desk staff (that’s why you hired good people, remember?). Have the part-timer who reconciles customer credit payments and researches disputes write down the monthly process he goes through. Develop a monthly business calendar with recurring events that need attention – for example, sending quarterly financial information to your accountant. And so on.
Then, use these documents to train new staff on their roles. When something falls through the cracks, get into the habit of immediately updating the written procedure so that problem doesn’t happen again. And if it’s IN the procedure – but your staff didn’t FOLLOW the procedure – address it immediately.
You’ll also want to cross-train existing staff so that things don’t fall apart if someone’s sick or quits suddenly.
4) Keep your customers happy.
As we say here in Texas, “You gotta dance with the one that brung you.” Always remember that it’s the happy and loyal customers you’ve already got who make expansion possible.
Owners and managers often lose focus on their current business in the excitement of planning a new location or other expansion. Suddenly they notice that their existing business has started dropping off, slipping hiring standards have hurt client service – and now they’ve got a fire to fight. Meanwhile, assuming that the existing business will continue to thrive, they’ve already made financial commitments for the expansion.
Carve out time to stay close to your customers and clients. Keep the lines of communication open. In fact, because it’s so easy to deprioritize this when you’re in the middle of a big growth phase, put it at the TOP of your to-do list and pay even more attention to it than you usually do.
For example, if you’ve been teaching half of the classes in your yoga studio, and you’ve brought in someone else to handle that workload for you, continue to teach one class a week.
5) Earmark expansion funds.
You will almost certainly need access to extra cash even if you finance big-ticket items like your build-out or equipment purchases. You probably don’t know yet exactly what you’ll need it for. That’s OK – start building that financial reserve now so it’s there when you need it.
Potential examples of why you need that reserve: you’ll probably need business advice so that your expansion goes smoothly and avoids potential pitfalls, legal advice as you negotiate with new vendors or landlords, updates to your website and marketing materials to reflect the new scope of your business, tax advice from your accountant, and other services that require up-front payment.
We frequently get calls from business owners who want to expand and have exactly zero budget. They want business advice – but can’t pay for it. They need new marketing materials – but can’t pay for them. They desperately need legal help – but can’t pay for it. Sometimes they don’t have a backup plan. Sometimes they just assume they’ll get loans for everything they need.
If you’re in that situation, our advice is that you delay expanding. If your current business is basically operating at breakeven – you don’t have any excess cash after you pay your monthly expenses – we want you to make sure that you’re not just digging a deeper hole before you make more commitments. Consider getting an outside assessment of your current business before you decide to move forward. You may have work to do on your existing business first.
Keep these five success factors front and center and you’ll maximize growth and minimize risk for your business expansion.
