In her first column as the Evening Standard's small business agony aunt, fragrance entrepreneur Jo Malone explains how to go about expanding a business.
Dear Jo,
I run a small advertising agency and am ready to pitch to larger clients than we have traditionally sought. Should I promise a large campaign and then hire extra staff or put the infrastructure in place in the hope we win the business?
I’ve been in this situation. You have big ambitions for your business, which is fantastic, but you’re impatient to step up a couple of divisions. It’s where we were with the first year of Jo Loves, which we started basically with just four of us sitting around the kitchen table.
You want to grow at the speed you feel your business deserves but you don’t have the people, the offices and everything else that requires. Do you run that risk of employing three, four or five more people or try to make do with what you’ve got?
Don’t be in a hurry. Take stepping stones: not a huge leap, especially in an advertising agency, where you can’t afford to make mistakes. Your reputation is absolutely everything. If you overpromise and then can’t deliver, it could be a catastrophe.
Meanwhile, losing sight of the needs of your existing clients — your bread and butter — could kill your business completely. Over-expanding carelessly could easily come around and bite you on the backside.
So hire good people for expansion but only on short-term contracts, rather than take them on permanently and have to say six months down the road: “Sorry, but there’s not enough work.”
Progress carefully. We started our business with four people. Now we have 10 but there’s work enough for 14. And despite the high demand, I only have one shop.
Don’t go jumping into swanky new office space. Use what space you’ve got creatively.
Some of the most successful, creative people I know don’t have offices at all. They practically base themselves in coffee shops. Not that you have to retrench to Starbucks, but you get my drift.
Trust me — you will get to the big league but only if you build cautiously.
