A firm that expands considerably faster than anticipated can generate difficulties and stress at a time when any business owner would rather be celebrating. While some firms easily transition from specialized to mainstream by scaling, others struggle to preserve their identity and high levels of customer service—and, eventually, revenues. With these issues in mind, I’ve detailed some of the risks of rapid development and how you, as a successful business owner, can prevent them.

1. Lack of a business expansion strategy

At the start of a business, the owner is more likely to be concerned with staying afloat than with what to do if the company experiences significant development. You’ll probably have short-term goals and a big-picture desire, but no plan for how to move from one to the next.

Avoid challenges caused by rapid expansion by preparing how it will affect your financial and human-resources needs, as well as the day-to-day operations of the organization. It is critical to assess how what is already in place might be modified to meet future requirements. The adage goes, “fail to plan, plan to fail.”

2. Minimal understanding of the financial impact of rapid growth

Many small businesses believe that the more sales they generate, the more money they will make—and thus, growth is the goal. This is true when the journey has been carefully planned, but it is also critical to comprehend the broader ramifications of progress.

More sales necessitate more manufacturing, which means additional employees, machinery, and overhead expenditures. These demands can frequently outpace working cash, and many businesses struggle when confronted with their first tax bill due to insufficient reserves. To keep track of this, business owners should implement comprehensive financial-monitoring systems that measure all costs involved, including supplies, machinery, staff, marketing and customer acquisition, facility overheads, packaging, and shipping. Only with a good understanding of all these aspects can a business owner get a true picture of the profit and value of the business.

3. Unable to fulfill requests on schedule

Another common issue for businesses experiencing unanticipated quick expansion is a lack of capacity to meet demand. Business owners must address this from the start and take steps to ensure that the company can fulfill orders quickly and provide exceptional customer service.

While the founders of a firm are likely to be intimately familiar with its goods at the outset, it is critical to bring on staff and learn to delegate at an early point of the business lifecycle. Sharing information and responsibilities will be extremely beneficial if the organization grows and new employees must be taught rapidly.

4. Providing too many products to too many clients.

Companies having a vast product portfolio will likely struggle to maintain delivering all of them if the business expands too quickly. Similarly, if the product or service is given contractually to a large number of consumers, it may be impossible to provide each customer with the same quality of service. I’ve seen the original unique selling point that your clients like become a millstone around a company’s neck when what they initially supplied does not scale.

In the event that a firm has developed rapidly, and in order to maintain a good level of service, a company owner may be able to reduce the number of products they supply, or even triage the customers with whom they wish to continue dealing. Determine which of them adds the greatest value to the firm and whether some would be better suited as a thorn in your competitors’ side.

5. Ineffective leadership and staffing

When it comes to managing rapid business growth, your employees are your most powerful asset. Everyone who works at the company should be adaptable and capable of functioning under pressure so that the company can withstand any unexpected moments of growth. This is especially true for senior staff.

Business owners should assess the skills and leadership styles of their current management team, and ensure that everyone in a senior position is capable of driving the company forward. Managers should be able to offer the same high standard of work at all times, as well as take the initiative to think swiftly and respond to changing requirements.

It’s also essential that you thoroughly refine the onboarding process for new employees. When a firm is rapidly expanding, it is critical to hire the right additional employees to ensure the company’s continued success. While you may want a speedy turnaround between advertising and hiring new employees, the onboarding process must be carefully managed to ensure that the best candidates are recruited. According to studies, a successful onboarding program can increase new employee productivity by 70%.

Conclusion

Forewarned is forearmed. Thinking through these five common pitfalls of rapid growth will help you plan ahead and prevent them. It’s critical to implement the methods that will allow your organization to prosper right now. This way, if your firm takes off like a rocket, you’ll have enough fuel to take advantage of the chance.