Are you a fan of the KISS – keep it simple, stupid – approach to life and business?
I love it when situations, challenges, or problems can be boiled down to the proverbial brass tacks and as I was recently reading an article written by AP and USA Today small business writer, Rhonda Abrams, I think she hit on two principles that are yardsticks for measuring your ability to achieve notable success in your business. Or if you’re a prospective entrepreneur, if you can’t operate within these two principles, you might want to consider a different career path or strategy.
Her article was headlined 7 rules for small biz growth and the two rules I want to highlight are these:
- Take care of your bread-and-butter business first, and
- Don’t bet all your money on one horse.
These two business principles are multifaceted and as you can easily see, they pull you in opposite directions. The first point I want you to consider is your ability to hold two opposing goals in your mind and operate on both of them at the same time.
You might quickly jump to the conclusion that, yes, you can pursue both your core business and expanding into different areas at the same time, but I urge you to think a little more deeply. Will you end up merely going through the motions on one while your heart is fully invested in the other?
I’ve heard a lot of people I respect say something to the effect that you can’t have more than one priority and I also know that our productivity goes way down when we multi-task. Further, experts like Shep Hyken will tell you horror stories about companies that drifted out of their “lane.”
This is all to say that finding and “training” another “horse” to ride – to use Abrams’ language – is not easy: But it’s necessary.
As I’ve wrote elsewhere on these pages, I think we’re in a special economic era right now and the surveys prove it. Small business optimism is at an all-time high. A growing economy combined with tax reform should keep the optimism high for the medium term. This means that the coming months are the ideal time to place a few bets on other horses. These pro-business growth conditions, when they are gone, might not come back for a long time.
Let’s discuss some ways you can find other horses to ride:
Expand your customer list. If you’re overly dependent on a handful of legacy customers, get creative about adding names to your list. Expanding your geographic reach is, of course, one way to do this. If you’re hyper local, go statewide; if you’re statewide, go national; if you’re national, go global; if you’re local, go ecommerce; or if you’re soley ecommerce, devise a brick-and-mortar strategy. Also, some of the following points can expand your customer base.
Acquire a related company. Perhaps the easiest way to expand into a neighboring state is to buy a company there. This acquisition can be a company like yours, a supplier, or a related industry. Amazon’s profits come from its web services, not its retail sales. I believe that as they developed their fantastic ecommerce system they realized that they had created an incredible Internet infrastructure, so why not use that expertise to spin off a web service? In a similar way, Uber expanded to deliver restaurant food.
Integrate vertically. Whether through acquisition or expansion, consider how you can apply the principle of vertical integration to your company. What are you paying to have done that you could do yourself? Also, when you establish this new operation, are there others you could sell the service or product to?
But let me end this by wrapping back around to what is really my central theme: Are you the type of person who can balance these expansion tactics while continuing to provide the right level of care and feeding to your core business?
Many of us lean heavily to one side or the other. Some are wired to doggedly manage the core business, while others love to be pursuing new opportunities. After honestly assessing your position in the balance between those two competing success rules or principles, if you conclude that you’re deficient in one, perhaps it’s time to get help.
You could bring on a partner whose strengths complement yours. A higher-level manager might be a possibility as well, perhaps even a short-term project manager to handle an expansion project. If you feel your strength is in opening new doors for your company, bringing in strong operations managers to keep the core business moving forward could free you up to do what you enjoy most.
What do you say? Do you have what it takes to be successful while balancing these two goals, or do you need to come up with a plan? Don’t wait too long to answer those questions. Opportunity is knocking!