The problems of overnight success – and how to… | tutor2u Business

The problems of overnight success – and how to prepare for growth

I’ve come across a great article and video clip about the problems faced by a company whose business boomed overnight.  A nice problem to have, and an interesting problem too!

The article describes the problems faced by American Giant, a sweatshirt manufacturer who was enjoying "slow but steady growth", before it got the type of positive publicity many companies can only dream off. Orders rocketed, and the firm was sent into emergency mode, suffering 'catastrophic success'!

The company was the victim of a dramatic boom, without the manpower or the materials to meet demand.  This can often be a problem for small businesses that need to grow, but they are overly dependent on one finite resource - for instance, the time and expertise of an entrepreneur starting their own business.  They can satisfy 50, 100, even 500 customers - but as demand increases, it becomes impossible to grow supply. The advice therefore: make your business scalable – which means it has the ability to grow.  Try to remove the bottlenecks that present capacity constraints.

Have a look at the video and see what you think.  There article contains some top tips on how a business can grow successfully:

  • Establish why customers should be turning to you instead of competitors. Then, make that message the core of advertising and marketing campaigns, and use it to dictate which customers you target.
  • Increase conversion rate: Most small firms don't track the conversion rate from prospects to sales, but it can be worth investing in software that does. Once you know the real rate, you can better reach out to those who got away to determine your weaknesses.
  • Increase customer worth: Look to increase sales by offering more or adding value to your services. Don't be afraid to raise prices: even with the economy in its present state, businesses providing wanted services have been able to raise their rates by 10%.

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