How big should you grow your company? If you're grappling with this question, consider the pros and cons of staying small.
It may go against the entrepreneurial spirit, but sometimes it's better to stay small and profitable than to force growth. You may choose, as do many women business owners, to keep your business small in order to have more time for your family, or so that you can be directly engaged in the aspect of the business that interests you most.
Staying small is a strategic decision that requires planning, discipline and knowledge about the advantages and disadvantages that accompany this choice. Here's a look at the pros and cons of staying small, and some ideas to make it work for you:
Small can sometimes mean lower risk. With fewer assets at stake, a small company can fail without much consequence. If your business concept doesn't require a large monetary investment, you might be able to financially afford to take a chance on an idea that, if successful, you can build upon in the future. Examine your motives for staying small carefully, however. Fearing risk - including debt - is an emotional rather than strategic decision that can undermine your business.
Small can sometimes mean control. According to studies, a primary reason that many women start their own businesses is for greater work-life balance and to "be their own boss." Unfortunately, staying small also means taking on more (or all) of the day-to-day operations yourself, while the demands of clients and the market can upend even the most carefully planned schedule. Make sure that giving yourself flexibility doesn't put you at a competitive disadvantage. Keep in mind that a larger organization, in which you can delegate more responsibility, might actually offer you greater balance.
Small can sometimes mean that you're focused. Another reason women start businesses is to pursue a passion, and this passion can give you the edge over bigger competitors. Take the time to understand and communicate your company's differentiators from larger rivals. Can you offer more personalized service? Are you an expert or innovator in your field? Remember that being small doesn't shield you from competition and a constantly changing market. You must continue to evolve, even if you don't grow.
When making a decision to remain small, thoughtfully examine your motives. Asking yourself crucial questions about what's most important to you and your business ensures that you're making that decision for the right reasons.
For additional insight on growing (or not growing) your business, read the cover story of the spring/summer edition of the PNC Insights for Women in Business e-magazine.
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