13 June 2016 11:30
To grow or not to grow: the small business dilemma
New research lifts the lid on the motivations of business owners that have decided to grow their business and finds that they are often driven by personal as well as commercial factors.
Avery WePrint surveyed 350 UK small business owners who had taken steps to grow their business and asked them about the growth decisions they had taken over the past two years.
Researchers found that the decision to grow is one of the most difficult that entrepreneurs have to take. Just over a quarter of those surveyed said that growing a business was harder than starting one; and 22% said the two decisions were equally challenging.
Fiona Mills, Marketing Director at Avery WePrint said:
"Questions surrounding growing a business can be something many small business owners agonise over. In some cases, the dilemma can be even harder than deciding to start up in the first place."
The biggest fear for those that planned to grow was failure, followed by worries about losing money. In fact, most respondents said they favoured saving up until they had enough capital to grow the business; and 40% of business owners said they used their own personal savings.
Strategies for growth varied widely but the report found the most common business growth decision was launching a new product, followed by taking on more staff. Other key growth strategies included rebranding and renting or buying new premises.
Researchers also investigated the timing of SME growth plans. The findings show that most small firms take steps towards growth after one or two years of trading; however, a quarter of those surveyed said they waited until they'd been trading for between three and four years.
When asked what made them decide to take a growth step, over half of businesses said they "just felt that the time was right"; and a third said that the timing was right for them personally. Practical factors, such as having a new product ready or finding the right premises, came lower down the list.
And, even though 20% reported that growing their business had cost them time with their families, over 80% of respondents said they had no regrets at all about their decision to grow; and more than a third plan to take on new staff or launch a new product or service in the next two years.