Small Businesses Often Choose Not to Grow

One of the things we consistently hear in our interviews with small business owners (male and female) is most don't want to grow their businesses beyond a certain size.  In most cases the size they want to limit their business to is quite small.  

We first explored this topic years ago when we held a series of focus groups to define small business success.  We found small business owners defined success as meeting their personal objectives for the business.  Rarely was high growth or getting big a priority. 

One of the main reasons they don't want to get big is they feel it wouldn't be worth it.  

With this in mind I'm always curious about studies that show certain small business segments aren't growing as much as someone other than the owners thinks they should.  

For example, the Celebrating Women Business Owner's series over at Open Forum talks about women's businesses having growth pain points.  Key quote:

"our study also found that while women are starting and growing new and innovative ventures in droves, many experience growth pains at the 5-to-9 employee and $250,000-to-$499,999 levels. "

This study seems to assume all small businesses want to grow bigger than this size.  We don't think this correct.   

This is not to say that small businesses don't struggle when they get to 5-9 employees.  They do. Getting bigger than this generally means moving beyond the direct span of control of the owner.  Many small business owners (both male and female) don't have the skills and abilities to do this.

But based on our research, many (both male and female) don't want to grow beyond this point. They don't think the added complexity, time and effort associated with running a bigger business are worth it.

I'm all for women (and men) building big businesses, assuming they want to.  

But let's not assume they all want to.

Comments

[Trent Jones]

Why wouldn't you want to grow your business as big as possible. There are sticking points when starting a business, but not anything you can't over come. I've heard that executive business coaching, or a business coach can provide a lot of help growing a business.

[Steve King]

There are lots of reasons why small business owners choose not to grow, but the reason most often cited is lifestyle.

Growing a small business takes a lot of time, effort and energy. Many aren't willing to trade-off family time and work/life balance just to have a bigger business.

For example, I'm not planning to grow my small business (Emergent Research). The reason? I have other things I like doing with my time.

[Phoenix Search Engine Optimization]

I think a lot of people start businesses just to fill some needs and not just because they want to be super successful business men and women. If the business provides what they need, they may be focusing their efforts somewhere else.

[Justin Amendola]

A related point here...

I find it interesting that many small business growth stories arise when the owners never intended to become big companies.

One reason might be that too big a focus on growth at a business' early stages might lead to lapses that prevent the business from ever getting off the ground.

For example, is it more important to have an iron-clad, 5-year business growth plan or to focus on delivering a quality product/customer experience that customers will want?

Perhaps you're seeing a significant segment of small business owners choosing to focus on the latter option early in their businesses' life cycles? I think your point about quality of life is also involved.

I'd argue that the "quality" approach is just as likely to result in huge growth - even if unintended when owners start the business.