Very few entrepreneurs are more revered than Sir Richard Branson, the owner of over 400 companies around the globe. The chairman of the Virgin Group is known for his adventurous ideas but his opinions on small businesses aren’t as ambitious as you might think. In 2010, Branson bestowed some rather surprising advice to small business owners at a marketing conference in Indianapolis. The advice was largely about expansion and why small business owners should proceed with caution when it comes to increasing revenue.
With so many methods of expansion on the table, it’s understandable for small business owners to have difficulty choosing the investment that will be most beneficial in the long-run. Branson shed some light on this common dilemma by explaining what businesses should keep in mind in order to increase revenue while maintaining the identity that brought the business success early on.
Here are three of Branson’s guidelines for business owners looking to invest in a growth opportunity:
1. DON’T EXPAND IN SIZE TOO QUICKLY
Richard Branson does not view size as a competitive advantage. In fact, he seems to believe that companies that are eager to add property or ramp up productivity with a bigger team risk losing their connection with customers. “Small is beautiful,” Branson said at the conference, where he noted that Virgin Records and Virgin Airlines are far from the largest companies in their industries. The number one priority of any business should be releasing quality products or services, and growing in size too quickly can actually jeopardize customer satisfaction. Certain products or services lose value if they are not developed with the same “style” that attracted customers in the first place.
This strategy can work in your favor because according to the Huffington Post, investments related to product development are the business plans that are most likely to be approved for small business loans. So instead of a second location, consider taking out a working capital loan that will allow you to run your business smoothly while you spend a little more time than usual perfecting your new idea. Alternative business lenders like United Capital Source offer working capital loans that are tailored for short-term investments of this nature.
This program supplies an amount approximately equal to the combined costs of day-to-day operations and regular expenses or more if you qualify. Operations might slow down due to your focus on the project at hand but you don’t have to worry about paying bills or your employees at the end of the month. Funds can also be distributed very quickly, since your project is likely time-sensitive.
2. REMEMBER THE VALUE OF CUSTOMER SERVICE
Richard Branson started Virgin Airlines after having several negative experiences as a passenger on other airlines. Most of these experiences were attributed to one thing, he told the conference: “dreadful service.” To prevent his airline from taking on this flaw, Branson made a conscious effort to look at traveling from the perspective of a customer and converse with customers as much as possible. He discovered what customers wanted out of an airplane experience and implemented features such as the onboard bar, massages, and power outlets at every seat. To this day, Branson makes phone calls to random customers and asks what Virgin Airlines could improve for their next flight.
Branson’s remarks suggest that enhancing customer service is a very wise investment. You could accomplish this by hiring a customer service representative or social engagement specialist who will use customer feedback to shape your company’s image. Working capital loans are ideal for this situation as well because you’ll need at least a few weeks to train your new staff member and/or interview potential candidates. Your loan will also let you devote 100% of your attention toward both efforts, which is highly beneficial considering you’ll probably be doing this in preparation for a particularly busy, chaotic period of the year.
3. HIRE PEOPLE BASED ON ATTITUDE
While other airlines were only hiring the most experienced candidates, Virgin Airlines was looking for candidates who had the best attitudes and the highest capacity to learn. Branson said that when he tried the former route in the past, he realized that these candidates essentially “had learned how to not do their jobs.” Many business owners can see where Branson is coming from because it’s much harder to teach someone how to display a good attitude than it is to teach the basic skills required for the position.
If only it weren’t so difficult to find candidates with desirable personalities. Most, if not all, of the people who apply to job openings do so because of experience, so you’ve got to get the right candidates to come to you. This takes time, and a small business loan can buy you all the time you need to make sure you aren’t wasting your money on a sub-par new employee.
PUT SIR RICHARD’S PLAN INTO ACTION!
In order for a small business to succeed, it must accept that building a great company requires additional business funding. You’d have to wait several months to receive approval and funding for a bank loan but United Capital Source is able to approve most funding applications in under 24 hours and have funds in your business account in a matter of days. Terms are flexible and can be customized based on the unique circumstances of your business. Whether you are trying to take on new hires, enhance your company’s image or optimize product development, UCS will find a funding program that is right for you!