Growing Too Fast without Operational Stability

Many business owners become eager to expand when things are going well. It's understandable - Growth equals revenue which equals success. But while growth is exciting, expansion simply for the sake of expansion is one of the most dangerous financial mistakes a business owner can make. Acquiring additional equipment, locations, or businesses, without properly assessing the financial and operational impact on your own business, can be a very high-risk move.

Before making any decisions, explore the following questions: Will this expansion support my long-term business goals? Do I have the resources to make this growth successful? Will this growth improve my financial performance?

Hopefully you already have a financial plan for your business, providing a roadmap for your current and future goals. When exploring a growth opportunity, create a financial plan for the growth and integrate it into your current financial plan. This will allow you to predictably structure your growth, ensure you're prepared and ready to pursue the opportunity, and that it will contribute to the success of your business. If you don't have a financial plan now is the time to create one.

Growth is great, and can certainly lead to higher revenue. But only if you're confident you're financially ready and your operations are stable.