By Rieva Lesonsky, CEO of GrowBiz Media & SmallBizDaily.com
Do you have big dreams for your small business? Some entrepreneurs are happy with a business that just pays the bills and lets them be their own boss, but most of us have larger goals. While you may not want to be the next Starbucks, your aspirations may include expansion into new markets and territories or simply adding a second location.
If growth is in your future plans, there are some important steps you should take now to prepare your business.
Step 1: Create an employee handbook
You may have already done this — in which case, congratulations. (Technically, you should create an employee handbook before you hire your first employee.) If you haven’t, now is the time. A growing business may need to hire employees at a rapid pace, and an employee handbook ensures they’re all on the same page about expectations, paid time off, overtime, holidays, and other day-to-day concerns, such as how to track time or submit timesheets for payroll.
Your employee handbook is also an important part of your legal protections. It should state your policies regarding things like sexual harassment, nondiscrimination, family and medical leave, and other issues that you’ll need to deal with as an employer.
You can find sample employee handbooks on DIY legal websites such as Nolo.com and RocketLawyer.com, but you should always consult an attorney to finalize your employee handbook and make sure it includes everything you need.
Step 2: Create an operations manual
When you only have a couple of employees, it’s easy to “wing it” or keep things in your head when it comes to your operations. But as your business grows, you’ll need to explain operational activities to new employees, and that’s where your operations manual comes in. An operations manual is a step-by-step guide to your systems and procedures.
For example, you might have a section on the steps your bookkeeper should follow when creating invoices, or what your restaurant employees need to do when closing down for the night. If you use applications such as shift scheduling software, your manual can direct employees to the app’s help section to ensure they know how it works.
Franchise companies like McDonald’s rely on operations manuals to teach their franchisees how to do things in an approved way. However, you don’t need to be as big as McDonald’s to benefit from an operations manual. Even if you’re just planning to open a second location, the systems and processes you set up will ensure your business runs smoothly in both locations.
Step 3: Assemble your leadership team
Do you hate to delegate? That’s a common characteristic among entrepreneurs — and it’s one you’ll need to overcome if you want your business to grow. You may be able to “wear all the hats” when you’re a one- or two-person business, but in order to successfully expand, you will need to step back and focus on the big picture rather than the day-to-day details.
Delegating also helps your employees acquire new skills and confidence so they can rise in your company. If you plan to grow, you will need strong leadership on your team, so start early to build a “bench” of qualified employees. Cross-train employees in aspects of each others’ jobs. Provide continuing training and education to improve their work skills. (If you’re on a budget, you can find free or low-cost training online or through local resources such as community colleges or adult education programs.)
Step 4: Make the most of technology
It’s all too easy for a business to end up with a patchwork of haphazard technology tools. You start out with just you and your computer, add equipment as you go, and adopt new software piecemeal. That may work at the beginning, but if your technology doesn’t work well together, it will hamper your business growth.
Take the time to carefully assess each piece of hardware or software you add. Cloud-based software is a great solution for growing businesses. It updates automatically so you always have the latest version, and it’s easy to add users as needed. Look for software that integrates with tools you already use, such as your accounting and payroll software. Once you’ve got your technology in place, do an annual technology review to make sure everything is still working smoothly.
Step 5: Manage your money
Growing your business takes capital. Create a financial plan for where you want your business to be and how you will get there. Stay on top of your cash flow and review your financial statements on a regular basis to make sure your revenues are growing strong.
If your expansion plans will require additional capital, start putting aside the money you need or get your business in shape to obtain funding from outside sources. Build your business’s credit score and your track record of success, and you’ll be more likely to get lenders or investors on your side.
By taking these five steps, even the smallest business can get on the fast track to expansion.
Rieva Lesonsky is the CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at email@example.com, follow her on Google+ and Twitter, and visit her website, SmallBizDaily.com, to get the scoop on business trends and sign up for free TrendCast reports.