• Businesses must plan for growth in the areas of equipment, revenue, location(s), personnel and other parts of the company that flex as it matures.
• If a business stays true to their plan for growth, new opportunities will naturally fit into the business when the time is right.
• Businesses should also plan for periods of non-growth, to allow for the stabilizing of all pertinent business matters associated with the company.

Growth in a company is not something that should just happen; it should be a planned, measurable expectation. Planned growth can be in the area of equipment, revenue, physical location(s), personnel, or any other part of the company that flexes as it matures.

An incorrect assumption often made by new businesses is that they want all the business they can get, regardless of the associated costs. This train of thought coincides with the adage, “any business is better than no business.” Pursuing this path of unplanned growth can be disastrous if it does not coincide with the original mission and vision for the company.

For example, a new trucking company has started up and they have two trucks and a small handful of satisfied customers. These customers have helped the company realize their vision and the company may feel a certain level of loyalty to them. They are right on schedule based on the action plans that they developed earlier.

One day the company gets a call from a new potential customer. The new customer says, “I want you to haul all my freight and I need to know how soon you can accommodate me.” The company’s immediate thought may be, “what an opportunity!” They may think of all the new revenue they could realize with an immediate increase in their freight volume. They may tell the new customer that they can start next week; all they have to do is figure out how to get more equipment.

Here is where the problems start. The new customer needs to move 10 trailer loads of freight a week, and goes to areas of the country that the company had not previously explored as far as return freight feasibility, associated costs, etc. As a knowledgeable business owner; does this make good business sense? Remember, the company only had two trucks and a few loyal and very satisfied customers. Can they obtain more equipment and drivers immediately? Can they really afford to increase their company’s equipment debt based on an assumed increase in revenue? Will their current customer base experience shipping delays because they are stretched too thin? Will the people that have supported the company thus far feel abandoned and start looking for a new company to haul their freight? If a business doesn’t take care of their customers, they will.

As a business owner, here’s the most important question to ask whenever presented with a situation such as this: “Is this part of my company’s vision and plan for success?” If the answer to this question is no, then a company must turn down the new customer and move on. The lesson to learn is the importance of honoring a company’s plan for growth. Consistent, planned business growth is sustainable and ultimately much more profitable.

These kinds of opportunities will come again and again. If a business stays true to their plan for growth, they will naturally fit into the business when the time is right. Remember the dream and vision for the business. Many companies have tried to be all things to every customer that walks in the door or calls on the phone, only to fail miserably in the attempt. Nowhere in the creation of a business plan and the careful and thought-out development of a company’s vision and values did it state that the company would do everything for everyone. Don’t let outside forces drive a business away from their well-thought-out plans for success.

Planned non-growth

Even though the normal assumption is that a profitable company is always growing, there may be times where a business has planned non-growth. This could be due to the realization of preset benchmarks for equipment, personnel, or capacity. This could also be because of changes in the industry, re-evaluation and changes in the company’s action plans, or changes in management or business structure.

Every business as it is created has a “life cycle.” Coming to the end of this life cycle may be another reason to have planned non-growth. For example, as discussed in the section on succession planning, the valuation of a business needs to be determined when presented with ownership changes due to death, disability, or retirement. This would be an ideal time to have a specific plan for non-growth to allow for the stabilizing of all pertinent business matters associated with the company. This would then allow for a clear picture of the business’s overall structure, and provide a solid footing to make informed decisions, pertaining to the future ownership of the company.

Another approach to non-growth planning in a company may be in one area of the company as it pertains to the company’s overall progress. An example would be if the company was planning a major shift in their business location.