Pitfalls of Rapid Growth: Scenarios to Avoid on Your Pathway to Success

4. Not Planning Your Cash Flow
As a burgeoning entrepreneur, you may feel that you can ride the wave of success and plan cash flow as you go. But poor cash flow planning is one of the largest pitfalls of growth. Successful entrepreneurs plan ahead and budget for growth cycle. Preparing a budget and cash flow is time consuming but imperative. Plan for what you think MIGHT happen—and even the worst that could happen—so you can best determine when you might need outside financing and how best to use it. Try to match your outgoing cash with incoming cash. It is far better to find out from the budget that April might be a tough cash flow month while you have plenty of time to plan for it than finding out in the middle of April.

5. Balancing Today’s Success With Tomorrow’s Growth
While eternal optimism is a necessity for an entrepreneur, it can also be the downfall of growing a successful business. Your business has taken off, customers are hungry for your product, and you’ve incurred a media frenzy. But many entrepreneurs have found that rapid business growth can lead to rapid ego growth, which can seriously affect your bottom line. Celebrate your success! But stay on top of your receivable collections; maintain good working relationships with your suppliers; maintain quality control standards; and keep your lender informed so that they can support and accelerate your growth. If the business is growing so quickly that you and your core team cannot handle the workload, get the help you need so that you can continue growing. Align yourself with experts, and your business will see continued success.

By Taylor Mallory

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