Is Downsizing the Best Way to Grow Your Business?
This might sound counterintuitive during an unsteady economic recovery. But before you jump up and object, please take a moment and listen to McLellan as he makes the case for shrinking your business in 2012. Consider, if you will, the following:
- Finding your sweet spot—and staying there—protects your company's stability during downturns. "Knowing what you do best (in terms both of profitability for you and results for the customer) allows you to hunker down and wait out an economic storm," he notes. But this philosophy will also serve you well as your business expands during an upturn.
- The more you chase dollars to maintain your size, the further you stray from what you do well. Whether your business is on its way up or its way down, taking on customers who aren't necessarily profitable, or whose needs you can't really meet, usually costs you time and money you can't spare. "It takes a savvy businessperson to be disciplined enough to not stray outside of his core competency," argues McLellan. "How can you differentiate yourself, or be seen as an expert, if you do everything?"
A failure to acknowledge these realities probably hurt many companies that might have stood a better chance if they had gone back to basics.
The Po!nt: The best way to grow your business in 2012 might be to shrink your business.
Source: Daily Fix.
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