The Case for Limited Growth

Today is St. Patricks Day 2008. It is also my 7th wedding aniversary. And the last day of a 7 day vacation with my bride. On trips like this, she gets to drive, I get to look out the window, read, maybe write. This is the arraignment that works for us.

What works for others, may not work for you. And so, I'm going to propose the opposite of what many traditionalists say you should do to be successful.

Say no more often.

The traditional business model says we measure success in getting bigger, expanding, more locations, more employees, more this, more that, more more.

Say no more often.

Because my bride introduced me to the "coffee shop experience" shortly after we met about 8 years ago, I'll use coffee shops as an example in this illustration. Also because I have done a lot of writing on the subject of Starbucks and other coffee shops recently.

For the first time since Starbucks started expanding, last year they had to cut back, shut down some locations, and 3 weeks ago, they shut down over 7,000 Starbucks across the country to retrain their staff.

Meanwhile across my town, and maybe yours too, there are other local coffee shops that are single location businesses. I visit places like the Firefly, Dragons Keep, the Mocha Lounge, Coffee Cafe, all of which are single location shops. We also have a couple of home town chains, Aspen and Higher Grounds that I have visited too. Convenience and location are the predominate reasons I pick one coffee shop over another.

I notice differences in each shops beverages, but my wife, now she really notices and she is picky too. Picky can be good, because when they love you, they tell everyone how great you are, and this leads to more and more positive word of mouth and more new customers. On the other hand, if a picky person does not like your product or service, they are not likely to stick around.

Here's the problem with too much growth: When there is too much growth, quality suffers at the expense of quantity.

So, what do you want to be known for, the mediocre blah shop with lots of locations, or the highly specialized shop with one location?

One Location that is able to make sure that everyone does things according to the standards you have set? Or Multiple locations that sort of follow the same standards, but not really, it all depends on the mood or the moon, or some other random fact of life that has absolutely nothing to do with the customer?

Please if you are going to have more than one location, and you buy into the "bigger is better" way of doing business, then create fool proof criteria for each location to follow and those that bend the rules, get rid of them. (Unless they find a way to make things better for your customer, then implement that at all your locations.)

This is all about marketing. And what about advertising? If you are limiting your growth (by design), do you still need to advertise?

Yup.

Because there will always be customer turn over and unless you are consistently inviting new people to be your customers along with reminding your current customers to come back more often, you will become out of sight, out of mind.

And the out of sight out of mind process can occur very slowly, sort of creep up on you, until one year you notice, that things are not as busy, the cash isn't flowing as much as it was a few years ago, etc.

One last comment about limiting your growth. Even if you have just one location, you can get caught up in expanding beyond your expertise and lose your unique identity. The answer?

Say no more often.

And contact me. I'll help you figure out when to say yes.

Go to WWW.ScLoHo.net and on the left side is a button to click on to send me an email.