Scaling a business to meet demands

6/9/2011

For the first time since the start of the economic recession, many small business owners are finding themselves in an opportune position to expand their operations. However, as American Express OPEN recently suggested, entrepreneurs should consider whether their business can scale well before quickly accepting new jobs.

For example, taking on new clients is more than just lifting sales - a company may have to train new staff, promote managers, balance its finances, expand its location or make any number of changes. It's crucial that business owners ensure their companies can do this before accepting any new work.

"Many businesses make the mistake of scaling their sales without scaling their operations and financing to proportion. Bombarding your existing employees and equipment with a barrage of new orders isn’t scaling - it's a recipe for disaster," explains the source.

Obtaining the appropriate funding is also crucial to success. Right now, many company heads have expressed challenges with acquiring commercial loans, so they should take that into consideration before ramping up production.