5 Signs Your Business is Growing Too Fast

As business owners, we talk a lot about ways to grow our businesses. After all, the goal is to sell more and make more money. So when phones are ringing off the hook and our client lists are growing exponentially, we tend to get pretty excited.

But there is such a thing as a business growing too fast. When that happens, it can be bad news for you as an entrepreneur. You could run out funds to keep supplies in stock. You could run out of manpower to fulfill client requests or orders. And once you hit a major snag, the effects can ripple throughout the rest of your business.

So how can you tell if your business’s growth is getting out of control? Watch for these signs.

You need to borrow just to make ends meet.

When your outgoing cash flow isn’t matched by your incoming cash flow, you’ve got problems. And relying on your business or personal credit to make up the difference is a bad idea. What happens if you need unforeseen electrical repairs at your store and you have no available cash to pay for it? Borrowing money is a sure sign that you’re growing before your business is ready.

Your employees are overworked and unhappy.

Are you asking too much of your staff, forcing them to work overtime or work on projects outside their field? It might be time to take a step back and re-evaluate the products and services you are offering. Focus on providing a few services really well and make sure employees get the down time they need.

Complaints are mounting.

One of the first things that happens when a company gets too big, is they have to cut corners when it comes to customer service. When this happens, complaints will rise. Not only will the volume of customer service issues increase, but word will start to spread about your business’s incompetence. It’s imperative that you nip this problem in the bud before the damage becomes irreversible.

Your profit margins are too tight.

Small profit margins mean less wiggle room when things get tough.  Small errors in accounting or unforeseen expenses can be disastrous. If you notice that your profit margins aren’t leaving you much of a cushion, there’s a good chance you need to scale back on your operation.

You can’t remember the last time you saw daylight.

Everyone needs time to relax, including the boss. If you’re working seven days a week and spending every minute of daylight in the office to keep up with the growing demands of your business, that’s not good. If you’re not burned out already, you will be very soon. When business owners deny themselves much needed R&R it’s usually because they’re spreading the business beyond its reasonable limits based on available manpower.

Growth is good, but it’s important that you’re reasonable about your expectations and your timeline for getting there. To prevent yourself from suffering the consequences of growing too big too quickly, set reasonable goals and develop a plan for responsible growth.