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Monday, May 01 2017
Is Bigger Really Better?

Remember back when you were a child? Looking up to grown-ups, dressing in their clothes and dreaming about being older?  Wishing time would go faster so you could play on the ‘big’ team or wear makeup or have more freedom. Most of us ‘grown-ups’ now wish we could go back and just enjoy the childhood moments for a little longer.

We are conditioned from an early age that bigger is better. That ‘more’ is better than less. What if this was wrong? Maybe more is not always better.

Many business owners have the same dream as our childhood selves – to be bigger and more grown up. What many fail to realize is that bigger companies come at a high cost. Growing pains are real.

  • Larger Companies often have Partners, Shareholders & Financiers. These can diminish your role in the company, limit your actions, flexibility, creative decisions and financial benefits. And splitting the profits across more people does not equate to more money in your pocket.
  • Larger Companies have more Employees. More Employees means higher accountability, payroll, workers compensation, additional training, human resources issues and generally more headaches.
  • Larger Companies have more Clients. That may sound great but more Clients means more work to maintain the Clients, more risk exposure to claims, more deliverables, more vendors, more service issues and more chances some people will not be happy with your product or service.
  • Larger Companies have Larger Gross Revenues.  That might sound good, but it does not mean that they have larger net profits. Studies have shown that the ratio of gross revenue to net profit remains about the same between small to mid sized companies.  The bigger you are, the more you spend to stay big.

Growing your company along a reasonable and steady path can be a good plan. Just know that it may not be all that you think it will be. It may not mean more time off or more money or more happiness.

In fact, it may mean more work for the same or even less money and a lot more stress. Kind of like being a grown up.

If you find yourself contemplating your growth, call me.   I am happy to listen and help you evaluate the pros and cons.

In the meantime, take a lesson from your childhood and enjoy the stage you are at.

Now -  I am off to play hide and seek!

Posted by: Hadley AT 04:56 pm   |  Permalink   |  Email
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