How to shrink – BIG!
Tips from start-up survivor Lisa Messenger.
When you’re launching a new business, it’s all about starting out and scaling up. But what happens when bigger is no longer better? What happens when bigger is scary, expensive and dragging you deeper into a hole? We asked someone who’s been there, done that: Aussie entrepreneur, speaker and author and magazine publisher Lisa Messenger, who generously shares with Success her tips on downsizing, fast.
1. Focus on the good.
I would argue that there is only so much chopping you can do. After you’ve downsized anything that obviously isn’t serving you, rather than focusing on the negatives, focus on the positive elements of your business that you know are profitable (or have the potential to be). Then look for ways to make those departments (or projects) more efficient.
2. Know when to stop.
When you’ve slimmed down so much you suddenly realise you don’t have a designer (this happened to us in April 2017), you know it’s time to stop. When you’re slimming, make sure you still have the ‘nutrients’ you need to produce a quality product, or a decentralised team of amazing freelancers you can rely on.
3. See the positives.
And explain these to your team clearly. As I told my staff, a profitable business gives us the chance to make measured decisions about the future, and really focus on what our community and our advertisers want. An unprofitable business doesn’t give us that luxury, so we need to make some changes immediately.
4. Hit the trifecta.
Instead of trying to change everything, focus on three very specific immediate priorities. For us, it was hitting sponsorship targets for our Kick. Start. Smart. Event, increasing sales for our print edition and increasing ticket sales for Masterclasses. By focusing on three targets, we were able to hit them.
5. Remember your customer.
One danger of expanding (or shrinking) too fast is a reduction in customer service. This was brought home to me when we no longer had anyone to answer our reception phone. “But we have an answering machine,” argued one of my team. That’s not cool when we’re a global brand all about communication and interaction.
6. Make the tough call, quickly.
When you decide to scale down, take some action immediately. As an entrepreneurial friend who’d also been in this situation told me: “This downsizing really hurt – a couple of people were let go and a number of longtime employees not happy about having to shift to a new area and they soon quit. Looking back, I wish I’d made this tough call even earlier, but such is life.”
This list is an excerpt from Lisa Messenger’s latest book, Risk & Resilience: Breaking and remaking a brand, available now.