Sometimes good things happen in “bunches”.” Business is booming, maybe the economy has turned around; have a lot to do and not enough time to do it. New opportunities are appearing from all sides; have to take advantage of everything.”
First lesson, you can’t be everything to everyone. New opportunities also, in most cases, bring in new cost. Numbers can be made to say whatever you want them say, especially if there is a lot of optimism in the projection.
This is the time to stop and catch your breath. The future looks bright and yes, one has to strike while the iron is hot. There is another factor to consider and that is your “core”. I define your core business as the staple in your income arsenal; it’s what brought you to this point and in a sense is opening new doors for diversification and growth.
Getting excited about a new opportunity that will require an immediate upfront cash infusion and has potential profits arriving at some future date, requires a lot of analysis. The number one question I ask is “can you hold on to your core and continue to grow it while developing the new opportunity?”
It’s at this point in the life of a business that a complete financial “what if” analysis is worth its weight in gold. That includes a realistic look at the cost of obtaining and delivering the new product or service. More important, a needs study of your target market has to be completed. . Just because an idea sound good is not a sufficient enough reason to move forward;. It’s the customers that have to see it as a benefit.
If multiple opportunities are available, select the one that is most affordable and provides the biggest return on the investment of time and money. If money has to be borrowed to take advantage of the opportunity, ask yourself, “is the core business strong enough to pay it back?”
Taking a calculated risk is part of growing a small business but the word “calculated” means that the business owner has done homework in the areas of:
- Finance: how much will it cost and can we afford it?
- Marketing: is there a market for the new product/service and how will it be reached?
- Management: what is needed to deliver the products/service
Anticipate opportunities and plan your business strategy to be ready to take advantage of them
Nick J. Petra CFP The New Business Revolution will provide you with the best tools to excel in your business. Subscribe to this blog to be the first to hear about it. www.strategicduck.com