These Small Businesses Grow Sustainably

src=”https://buffer.com/resources/content/images/2022/10/zingermans.png” alt=”How These Small Businesses Are Growing Sustainably”>

How can you decide when to say “yes” to growth opportunities and “no” to things that could lead you down the wrong path? It can be foolish to turn down opportunities to increase your company’s income or hire more people. In a world of billion-dollar valuations it is easy to feel inadequate when you look at your business’ growth. Growth is different for each business. Business owners need to be able to identify when and how to scale without losing their core values.

We present success stories from businesses that have grown sustainably and entrepreneurs who scaled without compromise . Additionally, we provide practical advice for those looking to preserve their identity while building their future.

Define your vision and values

It is important to look at growth holistically. This means to consider all aspects of your business and to reflect on where you are now and where you want it to go. This will help you identify the areas that are most likely to achieve your goals.

Holly Howard is the founder of Ask Holly How, a consulting company. She stresses the importance to understand your vision and to stay true to what you want. Some businesses won’t grow to millions of dollars, and not all business owners desire that. She said, “The reason why we start a company is often for the money. But also, people say for freedom. And what does that mean? The freedom to work the way they want.”

Holly asks these questions to help you focus on your vision.

• What are you looking to do with your day?
• These interactions are what?
• What do you do with your time?

Although it is easy to establish your vision and values, it can be hard to continue putting them into action, especially when it involves making business decisions. Made with Local’s Sheena Russell, a snack food company, knows this.

Sheena had to make big decisions about how she would respond to growing demand and how to scale her business. She shared that you will see the majority of energy bars in grocery stores are made in the exact same manner because they are manufactured at the same facilities and use the same equipment. However, the packaging may be different.

Sheena, however, wanted something more for her business. “We knew right from the beginning that we weren’t going to go that route. I wasn’t interested in making the same product as everyone else. I was not willing to compromise our product or our values. It works for many brands, but it’s not for us.

She refused to conform to convention and instead decided to partner with social enterprise bakeries, even though it would slow down the company’s growth. She insists that she was proud of her decision and believes she did. Sheena stayed true to her original vision and Made with Local remained the business she wanted.

Scaling your business involves more than just how much you can grow it, but also what you can do to sustain it. It’s equally important to consider how much and at what pace you should grow. Joel Gascoigne is the CEO of Buffer. He shares that this topic has been a subject of much thought.

Joel doesn’t believe that hypergrowth is part of his vision for Buffer. He states that the ideal growth rate for Buffer would be between 20-30 percent annually. He says, “That’s our growth rate that allows [it] to be very intentional and allows us to keep experimenting within the culture in the work environment.”

After defining your vision for your business, the next step is often choosing metrics to measure success against. You should be clear about which metrics you use to measure your business’ performance if you have certain values that you do not want to change.

Get away from traditional metrics to escape traditional pressure

It’s much easier to establish the metrics that will measure your business’s performance when you have a clear vision. Even though tried-and-true measures are important, it is crucial that you set and follow your own goals, even if they contradict the established methods.

Huw Thomas, cofounder of Paynter Jacket shared that “When it comes growth, the stereotypical method is to measure it by its revenue or the number of workers. We might just look at it and go okay, but it was a positive measurement of reputation or impact. It’s amazing how interesting we are as brands. We should stop measuring traditional metrics for growth and start looking at other ways to do so.

Paynter Jacket’s founders have avoided traditional growth metrics for their business because the ways they want it to grow is at odds with other ideas of growth such as more products. It is important to choose metrics and goals that will make you stand out in a competitive market such as fashion. We want to be the infuriating voice in our industry. We need to be around for the long-term to make an impact. However, this doesn’t necessarily mean we have to grow or be big. Huw says that this means we have to build our reputation.”

Paynter’s founders are focused on quality and sustainability. This also influences how they measure and decide how, when and where to expand their business. Becky Okell shares the idea that customers form an emotional connection to the brand and product because it takes so much time. Therefore, improving customer experience is a key metric.

Every piece of your business structure, from your vision and values, to the metrics that you use to measure success, has an impact on the others, including your chosen growth strategy. Although you may not have grand goals, most people want to build a successful company. One of the first steps to defining growth for your business is to determine what you should do after that success.

Assess your growth model, or create it if one is not available

Different businesses scale in different ways. The priorities and values of business owners often determine how they want to grow. Sometimes people may view growth as leaving a legacy. Others define growth as how they can set up a structure so they can take six-months off. Holly Howard says that growth can be defined as the acquisition of employees or scaling up to a new model of employee ownership.

Whatever your business model and vision, a growth model can help your company achieve the scale that you desire. Zingerman’s has, for instance, not used the traditional growth model but scaled.

Ari Weinzweig was the co-founder and CEO of Zingerman’s. Instead of opening more units in the same location, he had a different vision of what the business could look like. He says that Zingerman’s business community has grown in a way that is, at least, what we imagined. It’s definitely not the typical growth model. They aren’t necessarily bad, but they don’t work for me.

Ari and Paul, his co-founder, didn’t have a vision for Zingermans when they started, but Ari admits that in hindsight they did. “Essentially, the vision would have stated from the beginning that we wanted something unique and truly special. We want great food, great service and a place that is easy to get along with great people. These were all very clear to us from the beginning. Last but not least, we knew right from the beginning that we wanted only one [business].

Ari and Paul created a growth model to connect businesses, with semi-autonomous parts. Each business would have a managing partner. This was how they envisioned it and wrote it down in their vision.

Ari explains, “So there was an owner at the site who was passionate about the product or service that this business provided. We decided to operate as one synergistic organisation that models that philosophy and that framework still drives everything we do.”

Zingerman’s business family now includes Zingerman’s original deli, a roadhouse restaurant, a creamery and a bakery. There is also a business management consulting.

Prioritize people in search of growth

Periods of growth can also be periods of change. It’s likely that you will need to make compromises when you grow and change. Making the right decisions can be easier if you communicate with others involved in your business.

Ari is well aware of the importance of including the community in decision-making. He said, “Compromise” is something we all do every single day, and that it’s okay. One of the many benefits of the community, Ari says, is the ability to bring together diverse perspectives of like-minded individuals and reach better conclusions. Then, by making conscious collective decisions, we can make compromises that are collective.

Communication breakdowns can cause tension and mistrust, so it is important to prioritize people. Holly stresses the importance of communicating with your team. She points out the consequences of not doing so: When the team isn’t aware of what’s going on, tensions can arise within the group. We might also say that we have culture problems.

Participate in any phase of change. Explain why you are making certain decisions and the goals you have for your business. Give people your big picture context.

“We create that vision or purpose statement and they live in the guide, or on the wall as a poster. They should be living documents that are constantly woven into our conversations. Holly suggests that we check on our goals and our KPIs. We want to keep that context alive.” Holly says.

You should be aware of the unique challenges that other routes to scaling your business can present

Growth can be difficult and require you to make tough choices. To be ready, look within and think about how your decisions today will impact the future you want.

Scaling a business requires that you remain agile in understanding your customer and how they interact with you as you grow. Holly says that understanding our customers should be a continuous process. Holly says that we begin by defining who the customer is. Then, we can start to run with content strategies and social media marketing. But it should always be a conversation. Can we be sure that this person isn’t in this area?

The consequences of a different business model could be a challenge. Made with Local’s production capacity and demand have been growing at an unprecedented rate, but the decision to scale up their business can sometimes lead to capacity crunches.

Sheena says, “It has slowed down our growth because we’ve been using different methods.” We have been proven that this model can be grown, but the market has pulled us out of it faster than we were able to grow at. That has been a challenge.

You might also find yourself in a more competitive market and an industry changing. This could force you to redesign your product and repackage it. Buffer has experienced this challenge. Over the years, it has been difficult to navigate shifts in markets while still adhering to the vision and mission.

Joel shared that “Social networks are changing so quickly has been a difficult place to be in the last five, six year.” There have been times when we saw opportunities to continue our growth. It would have taken away the essence of the company’s DNA, which was to me always about small businesses and remaining committed to them.” This is why it is important to know and understand your vision for your business.

Paynter’s example shows that it is possible to choose an alternative route to growth. They wouldn’t be able to connect with their customers if they went the traditional route of making clothes.

To grow our experience and make it better, we must be firm about staying small and understanding what that means. Think about the limitations and strengths of your business. Huw explains that this often means you are able to do things differently than anyone else.

Do you want to learn more about growing your business? The full episode is available.

This interview features more insights from small business owners about growing their businesses. Season 2, Episode 4, of Small Business Big Lessons podcast.